FB Pixel no scriptVirtual megastores lure brands with new digital marketing services | KrASIA

Virtual megastores lure brands with new digital marketing services

Written by Shannen Tan Published on   4 mins read

Shopee merchants gain new visibility with Google Ads functionality.

The race is tight in Southeast Asia’s e-commerce sector. To keep major consumer brands active on their platforms, marketplaces like Shopee and LazMall that have come to define the region’s online shopping habits have deployed novel services to draw as many eyeballs as possible to products listed on their platforms.

In July, Shopee, one of Southeast Asia’s largest e-commerce players, announced that it had teamed up with Google to launch Google Ads with Shopee. Through this integration, brands on Shopee will gain access to specialized marketing tools to boost their online presence, create deeper engagement with customers, and manage and measure their marketing campaigns flexibly.

“The e-commerce industry in Southeast Asia has experienced massive growth in recent years and is forecasted to exceed USD 150 billion by 2025,” said Samuele Saini, sector lead for apps, e-commerce, and entertainment at Google. “This has been further accelerated by the pandemic, with more consumers shopping online, as well as both big brands and smaller sellers quickly pivoting to further build their e-commerce presence.”

The goal of Shopee’s latest partnership with Google is to help brands drive sales for their official stores on Shopee Mall, which is an in-app portal reserved for brand owners and authorized distributors. Launched in 2017, there are 15,000 official stores on Shopee Mall across Southeast Asia and Taiwan. The company takes a 2% commission fee on sales of electronic devices and a 5% fee on everything else, according to Shopee’s FAQ page.

Before their announcement, Shopee conducted a pilot for Google Ads with Shopee, tapping leading brands in the region, such as Asus, Oppo, Unilever, and L’Oréal. According to Peggy Zhu, head of brand and growth marketing at Shopee, the pilot was successful and generated a robust return on ad spend for the brands that were involved. A L’Oréal spokesperson shared that their pilot in Shopee Thailand had demonstrated a strong start, with the new partnership helping to strengthen their market outreach in the region.

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Google Ads with Shopee primarily offers three key solutions—a brand-managed solution, a Shopee-managed solution, and the Shopee Brands Suite.

These give clients options to exert different degrees of control over their ad campaigns. For brands that require finer management of their e-commerce marketing, Google Ads with Shopee allows them to create, manage, and monitor Google Ads campaigns through the Shopee Brands Suite or their own Google accounts. On the other hand, for brands that are less familiar with Google Ads, they can make arrangements with Shopee so that their ad campaigns are created, managed, and monitored on their behalf.

These solutions also give brands access to product data from Shopee, generating insights about product views, sales, and ad click conversions. According to Shopee, these solutions are intended to offer greater convenience and efficiency for brands, especially for those that want to interlace their online marketing efforts with existing campaigns on the Shopee app.

“These proposed new solutions from Shopee help various aspects. On the consumer side, it facilitates their search-and-purchase funnel. The consumer stages of awareness, search, evaluation, and purchase are optimized by linking search ad results on Google to product listings on Shopee directly,” said Goh Khim Yong, associate professor of information systems at National University of Singapore’s School of Computing. “On the merchant’s side, this increases the visibility of the merchant’s brand on Google itself and they are then able to collect and analyze more data on consumer search interest, purchase intentions, and conversion statistics. For Shopee, they can derive more revenue through managing digital marketing campaigns for merchants, especially for Shopee-managed solutions and Shopee Brands Suite.”

Goh added that the marketing tool seems to be modeled after Alimama, the marketing analytics and management solution arm of Alibaba, which backs Shopee rival Lazada. Alibaba has developed or has stakes in many consumer applications across the e-commerce and retail sectors. Alimama traverses these applications to track user data across these various domains and usage contexts, in turn generating insights to target consumers with specific products or advertisements. The main difference is that Alimama is an internal solution of Alibaba, while Shopee’s Google partnership is an outward-facing solution.

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Before forming its partnership with Google, Shopee had only offered sellers in-app advertising solutions such as keyword ads and targeted ads, which increase awareness and sales of specific products, as well as shop ads that boost traffic and brand awareness. Sellers on average pull in SGD 8 in turnover for every ad dollar spent, and experience a 37% bump in views as well as a 30% increase in orders for products that appear in ads, according to the Shopee Ads microsite.

Lazada also unveiled marketing solutions meant to resolve pain points for brands listed on LazMall, a Tmall spin-off, in March last year. It offered brands and sellers a marketing solutions package and business advisor dashboard, which together arms them with near real-time product information to help sell more effectively and efficiently. Additionally, they had formalized partnerships with 12 companies to tap into Lazada’s tech and logistics infrastructure and e-commerce expertise to strengthen their online retail presence. These companies include Huawei, Unilever, and L’Oreal, which also maintain a presence in Shopee Mall.

In the tug-of-war between Shopee and Lazada, consumer brands will emerge as the ultimate winners. Merchants stand to gain the most by maximizing exposure on both platforms, especially those that rely solely on Shopee and Lazada to sell and market their products. E-commerce platforms across Asia have seen explosive sales growth as pandemic lockdown measures have fueled an e-commerce boom. For the first quarter of 2020, Shopee’s gross merchandise value jumped 74.3% to reach USD 6.2 billion. In the same quarter, the total number of orders on Shopee reached 429.8 million. This is an increase of 111.2% in volume from the same period last year.


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