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[ 15-04-2014 ]
Online shopping starts to gain more traction in Malaysia
Rakuten Malaysia's office is located in Mid Valley.

Rakuten Malaysia's office is located in Mid Valley.

IF YOU are a shopaholic and hate going to busy malls, then online shopping would be an ideal choice. With so many virtual shopping portals in the e-commerce space, there are endless choices these days.

In fact, you no longer have to brave the traffic jams to shop because you can do it in the comfort of your home or office.

One of the more popular online marketplaces here is the Japanese-owned Rakuten Shopping because of the reasonable prices and wide selection it offers.

“There are more than 90,000 products from over 300 merchants with diverse selections ranging from electronics gadgets, computers and IT to healthcare, fashion apparel, jewellery and accessories,” said Masaya Ueno, the president and chief executive officer of Rakuten Online Shopping Malaysia.

Among the merchants under the Rakuten banner are Toys “R” Us, Caring Pharmacy, Poh Kong, SKII, Sony, Canon, Olympus and All IT Hypermarket.

Ueno said the popularity of online shopping is picking up in Malaysia.
Ueno says the popularity of online shopping is picking up in Malaysia.

With its extensive range of products, Rakuten Shopping is almost like an online mall, which allows vendors to set up their own stores and sell items.

“We only provide the platform for vendors to sell their products. It is more than just an online platform or shop. With the unique business-to-business and business-to-consumer (B2B2C) marketplace, merchants can build online storefronts on Rakuten and sell directly to consumers.

“Vendors can access the e-commerce platform, tools and run successful online businesses while providing consumers with a new and interactive online shopping experience,” said Ueno, who has been heading Rakuten Malaysia since 2012.

Based in the Rakuten Tower in Tokyo, Rakuten is Japan’s largest e-commerce firm and Internet company. Its B2B2C e-commerce platform, Rakuten Ichiba, is the largest e-commerce site in Japan and among the world’s largest in terms of sales.

Chairman and CEO Hiroshi Mikitani founded the company in 1997 as MDM Inc. In 2012, the company’s revenue totalled US$4.6bil (RM15.1bil), with operating profit of about US$244 mil. Its market capitalisation stood at US$17.9bil as of July 31 last year.

Rakuten, which means “positive spirit”, was founded in 1997. It was listed on the Japan Stock Exchange in April 2000 and on the Tokyo Stock Exchange in December 2013. The company has more than 10,000 employees worldwide.

Rakuten headquarters in Tokyo. The company reported revenue of  US$4.6bil in 2012. - AFP PHOTO
Rakuten headquarters in Tokyo. The company reported revenue of US$4.6bil in 2012. - AFP Photo

Last February, Rakuten bought over messaging app Viber and paid US$900mil for the mobile application, which offers free calls and text messages from a mobile phone.

Ueno said the online shopping trend has just picked up in Malaysia.

“It is not only about convenient shopping, but also about entertainment and discovery. Be it online or offline, it is important for consumers to make smart decisions by evaluating the credibility and reliability of vendors.

“Shoppers should know how to choose legitimate, reputable and secure online shopping sites and understand the products before they proceed with the purchase,” said Ueno who joined Rakuten in 2009 and has more than 10 years of experience in business development and corporate planning in the retail sector, including in luxury goods.

He was formerly the general manager in the CEO’s office of Japan-based Mint Asia Pacific, a leading footwear repair and repair retail service chain with operations throughout the region.

Despite the potential, a survey by Rakuten Smart Shopping revealed that Malaysian online shoppers tend to regret their online purchases.

Up to 71% claimed to have regretted their purchases in the last 12 months — often due to mismatched expectations. Some 48% attributed the key reason for their dissatisfaction being the products looking different from what they had been led to believe and 29% said it was due to poor product quality.

“The survey also revealed that online consumers in Malaysia could be more satisfied by learning to shop smarter online and making the right choices.

“Most prefer to do research before purchasing and 30% of Malaysian shoppers failed to complete their online purchases, as they prefer to research the products further and decide later. The survey gave us better insights on the experiences and priorities of online shoppers,” said the 42-year-old who holds a degree in International Economics from Sophia University in Japan.

Another set of findings showed that 76% of Malaysian respondents never or rarely interact with vendors during the online shopping process and those who do, prefer to do so via email instead of by telephone or live chat. By comparison, in Indonesia, 42% of the respondents frequently communicate with vendors. Taiwan, on the other hand, showed the least interaction with only 10% of the respondents communicating with vendors.

“Don’t be afraid to ask vendors about the products you want to purchase. Most consumers are spending time online and purchasing products without asking questions. They should expect the same experience they enjoy from normal shopping, which means talking to the experts and communicating with the vendors about the products.

“Online shoppers should also look for sites that offer different options for communicating directly and easily with online vendors so that you can ask questions about products up front. It is common for a customer to ask a member of the sales staff for advice on product specifications or simply to get an opinion on whether the product they intend to buy is right for them,” said Ueno, who feels that e-commerce in Malaysia is still in its infancy.

Online shoppers should also maximise their research time, he said.

“Many prefer to research products first and delay the purchase decisions. Digital pinboards, like Pinterest, are a great way to organise the products you’re researching and share them with friends to seek their opinons before committing to your purchase,” he said.

Today, Rakuten Group ranks as one of the world’s leading Internet service companies with a variety of consumer and business-focused services including e-commerce, e-books and e-reading, travel, banking, securities, credit card, e-money and professional sports.

The company has expanded its e-commerce business to 13 countries including Japan, while expanding its presence to 25 countries.

In 2012, Forbes placed Rakuten in the top 10 of its list of the World’s Most Innovative Companies. Expanding their global logistics portfolio, Rakuten acquired Webgistix, a US-based logistics specialist last June, following the earlier acquisition of Alpha Direct Services in France.

Ueno said Rakuten Malaysia is looking into many areas to improve online shopping.

“The three main areas that we have identified are good Internet penetration, mode of payment and delivery. Most Malaysians prefer to pay via credit and debit cards.

“Other factors that shoppers are looking out for in online shopping are a secure website, easy transactions, price differences between merchants, quality products and detailed photos. These seem to be the main priority,” said Ueno who operates from Rakuten Malaysia’s office in the Mid Valley mall in Kuala Lumpur.

He also shared a few tips on how to indulge in online shopping.

“Look out for product reviews and ratings, both positive and negative. Reviews by other buyers are the best way to gauge the reliability of the product and the online store before you purchase.

“There’s also a site on social shopping tools where they offer options to ‘shop together’ with your friends and ask their opinions while viewing the same product. Another thing to look out for is the best delivery options, from low-cost or free shipping options to cash-on-delivery and a pricing scale depending on how quickly you need the product,” said Ueno.

He was confident that Rakuten will soon make its way into more Malaysian homes.

“Rakuten offers an additional layer of support by providing e-commerce consultants and experts to advise merchants on their online business strategy, implementation, sales and marketing as well as lead and revenue generation,” he said.

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