The MRCA does not see the emergence of the online shopping as a threat towards their brick and mortar businesses. Although the trend is catching up, retailers who have no online presence have nothing to worry about.
The MRCA does not see the emergence of the online shopping as a threat towards their brick and mortar businesses. Although the trend is catching up, retailers who have no online presence have nothing to worry about.He has also advised MRCA members to slowly move into the online space as they are handling brands which are known to the public.
|Members of MRCA (source)|
MRCA is the largest retailer association in Malaysia (as seen in the world map above) with many of its members are big retailers, major brands here.
We have seen a number of big guns launching their e-commerce business lately, notably Parkson and Tesco. It will be interesting to explore how many big merchants in Malaysia are already selling online, whether via their own online store, or joining other online marketplaces.
Let's find out from the table below, arguably the market leaders in each category:
|Category||No||Retailer||Own Online Store||Join Online Marketplace|
|Department Stores||1||AEON||Gift only||-|
|Electronics & Appliance||1||Senheng||Yes||Rakuten|
|Health & Beauty||1||Guardian||Yes||-|
|4||Eu Yan Sang||Yes||-|
|5||Sa Sa||Yes (International)||-|
|Home & Garden||1||Courts||Yes||Lelong (Megatex)|
|Jewellers & Watch||1||Poh Kong||-||Rakuten|
|Books & Media||1||Popular||-||-|
|Pet Shops||1||Qian Hu The Pet Family||-||-|
|3||Pet Lovers Centre||-||-|
|Sports||1||Al Ikhsan Sports||Yes||-|
|2||Royal Sporting House||-||-|
|Toys & Games,
Baby & Kids
|1||Toys "R" Us||-||Rakuten|
From the sampling above, 22 out of 40 major retailers in Malaysia are already selling online and looks like the big guns are not treating e-commerce lightly.
It is also interesting to note that 16 of them are setting up their own online store while only 7 of them join local online marketplace. With 5 out of 7 sell on Rakuten, it seems that big merchants prefer B2B2C model more than B2C or C2C.
A closer look at Tesco Online Shopping setup & fulfillment service
The online venture of CARiNG Pharmacy with Rakuten
Why even the big retailers need to sell online?
According to the Euromonitor research, only 0.8% of the retail market in Malaysia is being done online in 2011, and it is expected to be 1.4% in 2016.
In this case, the MRCA president might be right as he does not see the emergence of online shopping as a threat towards their brick and mortar businesses.
However, there must be reasons why even the big guns are doing e-commerce already despite being just 1% share of their existing business.
- E-commerce being one of the next growth areas of retail.
- Being the first movers to position the retailer being a young, forward thinking company.
- Reach out to younger customers who spend more time on digital (vs traditional media).
- Reach out to potential customers in areas without physical outlets.
- Enable and encourage repeat purchases, increase customer loyalty.
- Execute and test marketing ideas, online campaigns that are not doable offline.
- Use data gathered online to understand customers more.
Ultimately, it is all about acquire new customers and increase customer loyalty.