More e-commerce sites may follow Ensogo’s demise
THE downfall of Ensogo, Southeast Asia’s top daily-deal and flash-sales website, is rocking Thailand’s e-commerce ecosystem, but more victims could emerge as giant multinational players are parading to the business scene, observers say.
Pawoot Pongvitayapanu, president of the Thai E-Commerce Association, said the Thai e-commerce industry was now the game of giant players. China’s Alibaba and US-based Amazon are cited as the big players that are venturing into the local market.
The association is now working to find ways to help local e-commerce businesses survive the fiercer competition, he said.
It is also looking for better oversight by regulators.
“The regulators should monitor whether any player is dominating the market. They should also come up with a policy or measures to prevent monopolies,” Pawoot said.
Alibaba Group Holding has built a presence in this region through the acquisition of Lazada. Its financial arm, Ant Financial Services Group, this month also announced a plan to acquire a 20-per-cent stake in Ascend Money, an online payment service provider in Thailand.
China’s Commerce Ministry said on its website on Monday that as a part of Ant Financial Services, Alipay Hong Kong Corp had the right to raise the share to 30 per cent in the future. Ant, providing services such as online payment, is valued at close to US$60 billion (Bt2.1 trillion).
Meanwhile, Amazon has announced a plan to invest hundreds of millions of dollars in Indonesia.
“It’s clear that Alibaba is using Lazada as the channel to ship Chinese products to the region. That will not only put pressure on e-commerce businesses in Thailand but also all SMEs in Thailand,” Pawoot said.
Tiwa York, chief executive officer of Kaidee.com, said that though e-commerce marketing in Thailand was still in an early stage, it was necessary that all local players improve their services and ensure that their sites offer the right variety to fight big players.
Local e-commerce businesses have to identify what their position is and where their target market is. They should be niche players and focus on segmented e-commerce, he suggested.
His Kaidee.com focuses on customer-to-customer deals. It is positioned as a platform for consumers who want to sell and buy used products.
Regarding Ensogo’s sudden death, he said a daily-deal business model tended to grow slowly, as those deals are in fact a price war.
