The e-commerce industry in Asia is heating up real fast on the back of rising disposable incomes and expanding internet penetration. E-commerce players in the region are constantly upping the ante, by expanding and diversifying their product line-ups and enhancing their customer service.

For the uninitiated consumers however, the e-commerce jungle can be somewhat overwhelming. Amidst the too many e-commerce portals offering as many deals, it can be a tedious task scouting for the best deals. Since price remains a major factor driving online purchasing decisions, online price comparison websites have sprouted up in recent years to help buyers find the best deals amidst plethora of online products available at dozens of e-commerce websites.

But how successful are these websites in actually driving traffic or conversions at e-commerce players’ websites? A recent MarkPlus Insight survey shows that Indonesian consumers actively compare prices online, before buying fashion products such as clothes, shoes and bags – which are also the most popular product categories for ecommerce. As per a Kataanda survey conducted in August 2015, up to 66% of the respondents used internet for comparing prices, before shopping for fashion products.compare prices_online

Source: MarkPlus Insight Kataanda Survey, n=229

The online bargain hunting behaviour stems partly from price sensitivity as well as a general consumer trait of the ‘feel-good’ factor associated with grabbing a discount and promotion. This is also part the reason why ecommerce players dealing in premium fashion brands have not taken off as such; just last week, such a startup shut down owing to market immaturity and difficult funding environment. Indonesian’s price sensitivity and a knack for grabbing promo offers, not to forget the concerns around security of transactions and fear of counterfeit – all point to their tendency of limited spending on online shopping.

Meanwhile, price comparison websites can be expected to thrive in Indonesia, akin to other e-commerce hotspots in South East Asia. Priceza, Thailand’s top price comparison website has already expanded in Indonesia, Malaysia, Philippines, Singapore, and Vietnam. E-commerce firms, while admitting that these price comparison websites don’t drive revenue as much, but the key is in driving traffic to the merchant sites, because the rate of immediate conversion to sale is anyway lower. PriceArea, one of the Indonesian pioneers in this space, said to have received 12 million visits across the year in 2013. The start-up was acquired by Korea-based Yello Mobile, in an attempt to enter the Indonesian ecommerce space.

 

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