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Social commerce: what approach marketers should take in APAC

By Alexander Oakden, Board advisor

August 19, 2019 | 6 min read

In 2019, eMarketer predicts the Asia Pacific will account for 64.9% of global e-commerce spending with six of the top 10 growing e-commerce markets hailing from the region. It is safe to say that e-commerce is a household name here in Asia, and we have found ourselves in a world where global companies are often playing catch up with their Chinese counterparts.


From a consumer perspective, the need of shorter, more convenient shopping experiences has not slowed.

This explosive e-commerce growth coupled with evolving shopping preferences has challenged technology platforms to redefine the consumer shopping experience – one way being within social media.

Coined by Yahoo in 2005, social commerce first emerged as a tool to support online product sales through shopping communities but has quickly evolved from ‘Buy Now’ buttons to become a stand-alone sales channel for brands.

Again, we see China leading the way with the recent rise of social commerce apps like Little Red Book and Pinduoduo. As well as WeChat continually driving innovation through its recent launch of Good Product Circle, which looks to promote the sharing of products between friends.

So why did it take so long for the global players to wake up to the opportunity?

For many years social media was often sold as an opportunity to drive reach and efficiency, leading to budgets being utilized by larger, brand marketing campaigns.

As greater measurement was introduced through third-party verification partners, the value of brand advertising was questioned and we saw the likes of Facebook and Twitter develop focused, in-depth performance capabilities to stay competitive within the purses of big marketers and bring them closer to the point of sale.

From a consumer perspective, the need for shorter, more convenient shopping experiences has not slowed, with increased mobile usage across the world being the catalyst for this change. Other enhancers of convenience include the evolution of influencer strategies, the ability to share shopping experiences through hotspots and the wider availability of brands through social stores and look books (which is expertly summarized by the research of Global Web Index**).

Competition has also evolved and although the Chinese brands are pioneers in product development, their scale internationally is yet to really hit the global players hard.

A more pressing challenge for social media channels is the rise of online marketplaces. E-commerce partners such as Amazon, Flipkart, Tmall/Taobao, and Lazada, who offer end-to-end marketing services and have the ability to target you and your competitors’ customers when they are most engaged in their purchasing cycle.

This unique advantage has resulted in a shift in focus and ultimately spend towards these platforms from marketers, so it is unsurprising that the large tech players are fighting back with social commerce solutions.

What does this mean for brands and marketers?

With social commerce still in its infancy, it is difficult to predict exactly how impactful the developments of global social networks will be and with any progressive channel, we anticipate adding another layer of complexity will create more decisional headaches for commerce and marketing leads.

To help simplify the landscape, I feel there are two core domains which brands should consider when approaching social commerce in APAC:

- Social store optimization to drive a consistent and relevant point of sale across social media channels.

- Conversational commerce to engage with customers through messenger functionalities of each channel.

These areas open the door to three really exciting opportunities for brands

Core sales channel

As technology and customer behavior changes, brands must now consider the balance of their point of sale strategy. On one hand, you have your D2C channels which, although do not incur fees, can be incredibly cost-prohibitive. The process of building a website, implementing efficient logistics and fulfillment operations and setting up a customer service platform prevent brands from moving down this path, particularly when looking to enter a new market.

Comparatively, marketplaces offer great and immediate reach; however, in the long term, sales fees may have lasting effects on overall profitability.

This brings us to social commerce. For new brands entering the market, social channels provide a solution which is both flexible and cost-efficient. Long-term we may see this change, but for now social stores seem to be a light at the end of the tunnel for brands who are in a tug-of-war between high operating costs and loss of revenue.

Improved performance

Having the ability to sell directly within the same channel in which you are advertising offers many benefits. Firstly, shortening your customer journey can improve campaign performance significantly as your key customers have less opportunity to drop out of your purchase cycle.

Secondly, connecting with a customer within one ecosystem improves the marketer’s ability to capture insights and, most importantly, visualize the complete consumer journey without relying on the almighty pixel (doesn’t that sound like heaven?).

Capitalizing on impulse

One of the biggest questions I have been asked throughout my career is how can brands can capitalize on large influencer spends through media investment? Community management was always an intelligent answer; however, customers now expect an efficient and personalized experience in every interaction.

This has opened the door for a new wave of companies such as who enable brands to proactively seek conversations with customers who have shown an interest in their brand, products or services through progressive AI chatbots.

Although in its early stages of development, solutions like this have the potential to change the game of both influencer marketing and community management as we know it. It will be an exciting space to watch.

Alexander Oakden is the board advisor in APAC at Mallory Ventures

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