Final report topic comparision of business between lazada and shopee

In addition to the big development in the e-commerce platform, business onthe mobile platform is also an aspect worth considering: according to a survey bythe E-commerce Association 2020

MINISTRY OF EDUCATION AND TRAINING

MINISTRY OF EDUCATION AND TRAINING

HOA SEN UNIVERSITY FACULTY OF LOGISTICS-INTERNATIONAL

TRADE

FINAL REPORT

BETWEEN LAZADA AND SHOPEE

HOA SEN UNIVERSITY FACULTY OF LOGISTICS-INTERNATIONAL TRADE

Ho Chi Minh City, 7/2022

2 22005773 Tran Ngoc Bao Han

1.4 What is B2C?

3.1 Shopee ACKNOWLEGEMENT

100%

3 2192575 Nguyen Ngoc Khanh

1.3 What is Business Strategy?

2.1 Shopee

100%

4 2195558 Nguyen Thanh Nguyen

1.1 What is an commerce business?

e-3.2 Lazada CONCLUSION

100%

5 2190132 Nguyen Minh Quan 1.5 What is C2C

HONOR PLEDGE

“I have read and understood the behaviours of academic integrity violation

I affirm that I have not given or received any unauthorised help on this

assignment, and that this work is my own”

Date: ……./……./2022

(Name and signature)

The report "Comparison of business strategies of two e-commerce platforms(Shopee and Lazada)" is a report contributed and completed by many individuals.First of all, our team would like to thank Ms Tra Ngo - Lecturer at Hoa SenUniversity for enthusiastically helping and editing so that the article can becompleted in the best way

Besides, the contribution of the authors of articles and documents is also animportant part to help our report add more knowledge and more accurateinformation

We do have many shortcomings, but we hope that our report will provideyou with the most accurate and informative information

Thank you very much!

Ho Chi Minh City, July 2022

TEACHER RATING

Ho Chi Minh City, June 2022

ASSESSOR

TABLE OF CONTENTS

TABLE OF CONTRIBUTIONS i

HONOR PLEDGE ii

ABSTRACT iii

ACKNOWLEDGEMENT iv

TEACHER RATING v

TABLE OF CONTENTS vi

LIST OF IMAGES viii

Chapter 1 INTRODUCTION TO E-COMMERCE BUSINESS STRATEGIES 1

1.1 What is an e-commerce business? 1

1.1.1 What is an e-commerce business? 1

1.1.2 E-commerce business conditions 1

1.2 What is ecommerce marketing? 1

1.3 What is Business Strategies? 3

1.4 What is B2C? 3

1.4.1 B2C concept 3

1.4.2 Features of B2C 4

1.4.3 Activities of B2C 4

1.4.4 The development potential of B2C 5

1.5 What is C2C? 6

1.5.1 C2C concept 6

1.5.2 Features of C2C 6

1.5.3 Activities of C2C 7

1.5.4 The development potential of C2C 7

Chapter 2 INTRODUCTION ABOUT SHOPEE AND LAZADA 9

2.1 Shopee 9

2.1.1 Overview of shopee 9

2.1.2 Achievement 11

2.1.3 SWOT analysis of shopee 16

2.2 Lazada 21

2.2.1 Overview of lazada 21

2.2.2 Achievement 22

2.2.3 SWOT analysis of lazada 24

Chapter 3 BUSINESS STRATEGY OF TWO E-COMMERCE PLATFORMS (SHOPEE AND LAZADA) 26

3.1 Shopee 26

3.1.1 Shopee’s business philosophy 26

3.1.2 Shopee’s business strategy goals 26

3.1.3 Shopee’s competitive advantage 26

3.1.4 Shopee’s business strategy model 27

3.1.5 Shopee's business strategy activities 27

3.2 Lazada 31

3.2.1 Lazada’s business philosophy 31

3.2.2 Lazada’s competitive advantage 31

3.2.3 Lazada’s business strategy model 32

3.2.4 Lazada's business strategy activities 33

Chapter 4 COMPARISON BUSINESS STRATEGIES OF TWO E-COMMERCE PLATFORM (SHOPEE AND LAZADA) 41

4.1 Similar 41

4.1.1 Shopee and Lazada policies for users 41

4.1.2 Quality of goods 41

4.1.3 Promotions/sales 41

4.2 Different 42

4.2.1 Lazada 42

4.2.2 Shopee 44

CONCLUSION 46 REFERENCE 47

LIST OF IMAGES

Picture 1.1: B2C business model 4

Picture 1.2: C2C business model 6

Picture 2.1: In 2015, Shopee was launched in 7 markets across the region 9

Picture 2.2: Shopee’s headquarter in Singapore Science Park 9

Picture 2.3: Shopee’s Office from now (2022) 10

Picture 2.4: The top 10 mosst visited e-commerce websites in Southeast Asia in 2020 10

Picture 2.5: In 2015, Shopee was launched in 7 markets across the region 11

Picture 2.6: Organize the first Shopee University course 12

Picture 2.7: Introducing Shopee Mall across the region 12

Picture 2.8: Achieve GMV more than 10 billion US dollars 13

Picture 2.9: Super Brand Day 13

Picture 2.10: Brand Ambassador for the whole region in 2018 14

Picture 2.11: Brand Ambassador for the whole region in 2019 14

Picture 2.12: Shopee 12.12 - Super Sale Birthday 15

Picture 2.13: Shopee Live and In-App Games 15

Picture 2.14: Shopee x Blackpink 17

Picture 2.15: Shopee x Son Tung MTP 17

Picture 2.16: Alibaba headquarters 22

Picture 2.17: Lazada image has been launched in 6 markets in Southeast Asia .22 Picture 2.18: Lazada and Alibaba Group 23

Picture 2.19: Picture E-commerce platforms with traffic in Southeast Asia in 2018 23

Picture 2.20: Picture Lazada website visits in 2019 24

Picture 3.1: Automated product classification system of Lazada Vietnam 35

Picture 3.2: LEAP Program và Forward Youth are Lazada's two programs on training and recruiting talents 36

Picture 3.3: Lazada protects employees' health 37

Picture 3.4: James Dong - CEO of Lazada Vietnam freely interacts with associates 38

Picture 3.5: The Learning Festival program brings a lot of useful knowledge on a variety of topics for employees 39Picture 4.1: Lazada Website UI 42Picture 4.2: Mr Vu Duc Thinh, Director of LEL Express Company introduced the automatic goods classification system 43Picture 4.3: Lazada website on computer 43Picture 4.4: Shopee Website UI 44Picture 4.5: Shopee cooperated and used the image of singer Bao Anh in the promotional clip for the huge sale campaign at the end of the year 45Picture 4.6: Shopee on mobile app 45

Chapter 1 INTRODUCTION TO E-COMMERCE

BUSINESS STRATEGIES

1.1 What is an e-commerce business?

1.1.1 What is an e-commerce business?

In Vietnam, according to Decree 52/2013 / ND-CP dated May 16, 2013, commerce business is through electronic devices with an internet connection tocarry out commercial activities Specifically, an e-commerce organization doesbusiness for the following purposes:

e- Purchase

 Provide related services such as Exchanges; Auction;Advertisement;

 Provide other commercial information

1.1.2 E-commerce business conditions

Currently, e-commerce business is an industry that needs to be regulated bylaw Although there is no law on e-commerce business, Vietnamese law also hasspecific regulations for this business Below we summarize some regulations onbusiness conditions for a number of e-commerce activities and e-commercebusiness registration as prescribed in Decree 52/2013/ND-CP and Circular No.Circular No 47/2014 / TT-BCT as follows:

 Traders and organizations with "business tax code"

 Own a domain name in compliance with the law

 Have an "e-commerce business registration license"

1.2 What is ecommerce marketing?

In business, marketing activities are always indispensable to increase thereach of products and businesses to customers E-commerce marketing plays amore decisive role in the success of this online business in the current 4.0economic era

“Marketing is the overall system of organizational activities designed toplan, price, promote, and distribute products, services, and ideas to meet theneeds of target markets and achieve them organizational goals.”

E-commerce is much different and superior to traditional commerce, so is commerce marketing Effective marketing activities must be based on the mainliving habits of people to plan for implementation Today, people mainly live,work and buy products based on the internet and electronic media Therefore, e-commerce marketing plays an indispensable role in helping businesses dobusiness smarter and more efficiently

e-There are many ways of e-commerce marketing, but to achieve visibleeffects, optimize resources and costs, each business must have its own e-commerce marketing strategy suitable for its specific characteristics of thebusiness field, industry and product of the enterprise

Here are some effective forms of e-commerce marketing you can refer toProfessional website design, eye-catching and flexible interface

A shopping website (e-commerce website) is the face of a business, anonline home for internet users to visit whenever they want to learn about aproduct or business

A professional website with the best user experience will bring a lot ofsympathy, help keep customers stay longer until deciding to learn and buy.Therefore, investing in website design and maintenance for businesses is also anextremely important form of promotion and marketing

Personalize user experience, segment appropriate customer segments

According to research, up to 40% of customers feel overwhelmed and leavethe website when there are too many products that do not match their purchasingneeds To reduce this rate, your website must be able to segment the rightcustomers and personalize the user experience so that customers can easily findwhat they are looking for through the following tools: Demographics, past

purchase behavior, purchase frequency, psychological behavior, averageshopping cart value, etc.

Optimizing the website's blog for SEO

SEO optimization means optimizing content and product descriptions onyour website and blog on general search engines such as: Google, Bing, etc Thatmeans, your articles and products will reach the top get high rankings, on thefirst page when users type search keywords on these engines This also meansincreasing the chances of natural visitors to your website

Promote advertising

E-commerce marketing is the activity of promoting, marketing and providinginformation on social media platforms such as Facebook, Instagram, Youtube,Tiktok including paid advertising and unpaid posts Expanding e-commercemarketing and omnichannel selling is a combined strategy to help your businessattract more customers

1.3 What is Business Strategies?

A “business strategy” outlines “the plan of action to achieve the vision; setobjectives of an organization and guides the decision-making processes” to

“improve the company’s financial stability in a competing market” (Martin H.,2021)

1.4 What is B2C?

1.4.1  B2C concept

B2B stands for the term Business To Business - an e-commerce businessmodel in which transactions occur directly between businesses Transactionsbetween companies are usually initiated from electronic communications,including communication through electronic exchanges

Picture 1.1: B2C business model 1.4.2 Features of B2C

The core feature of the B2C e-commerce business model is that: the maincustomers of the model are individual users

They are people who have a clear need to go online to search and buyproducts to serve their "use" needs, without incurring further purchasetransactions

Their buying behavior is done on the e-commerce website, from finding outinformation (product description, price, policy, delivery ) to online purchase,payment All are updated directly on the sales website

1.4.3 Activities of B2C

Direct seller model: This is the most popular B2C model in Vietnam In fact,this model has been around for a long time, the main starting point is theexchange and transaction activities between buyers and sellers Today, B2C inthis form is understood as online retailers Vendors here can be small businesses,micro businesses or simply online versions of grocery stores

B2C mediated through online channels: intermediaries through onlinechannels have flourished in the past 5 years and officially exploded during thecomplicated development of the covid epidemic We say that it is completelygrounded Look how Shopee, Lazada and Tiki make huge profits It can be saidthat, compared to the traditional B2C form, the intermediary B2C is gradually

becoming more dominant and will most likely replace the direct seller model inthe future.

Business to Customer relies on advertising: using advertising to attractcustomers to your sales website is typical of this model Model of using SEOtools to increase search rankings in Google and attract more free visits

Community-based B2C business model: social networking communities arebuilt around the interests of a group of potential customers Based on this factor,businesses can reach consumers, use advertising and marketing forms suitable fortheir goals Some of the social platforms with the most number of users areFacebook, Instagram…

Charge-based B2C model: this model is built on product payment Inaddition, consumers can also experience part of the service for free However, touse the services fully and more advanced, customers need to pay a fee to theprovider Netflix is a famous website that follows this model

1.4.4 The development potential of B2C

Vietnam is one of the 20 countries with the highest Internet usage rate in theworld (Source: Vietnam Digital Report 2020) along with the fact that almostevery citizen uses a smartphone, making it difficult to access e-commerceplatforms Easier than ever to die Consumers enjoy the convenience of shoppingonline from the comfort of their homes, while businesses thrive on low costs.With a virtual storefront, businesses do not need to rent or own a spaciousstorefront or stock too many goods This is ideal for small, low-capital businesseslike clothing and accessories stores In addition, dropshipping and shippingcenters have also grown in sync, allowing for a multi-layered B2C approach.According to the Vietnam E-commerce Association, during the period ofeconomic turmoil amidst the peak of the Covid-19 pandemic (from February tothe end of April 2020), online sales through B2C e-commerce sites Somebusinesses still bring 20-30% of revenue, especially with essential items such asmedical equipment, masks, hand sanitizer, food

In addition to the big development in the e-commerce platform, business onthe mobile platform is also an aspect worth considering: according to a survey bythe E-commerce Association (2020), in 2019 there were about 17% The companysaid that it has a mobile version of its website, but this rate has been less volatile

in recent years

Because this is also a new form of business, the legal framework is stillbeing reviewed and improved by the State In addition, with the delivery serviceand logistics infrastructure developed with e-commerce, the distribution andexport processes of goods are increasingly smooth, saving costs, time andimproving competitiveness for goods and for Vietnamese businesses

1.5 What is C2C?

1.5.1 C2C concept

C2C is a business model that is transacted by customers with customers, itstands for Consumer To Consumer If you want to make a transaction betweentwo customers, it is imperative that a third party stands out to ensure that thetransaction is safe, does not cheat and verify the price of that item

Picture 1.2: C2C business model 1.5.2 Features of C2C

Competition on products and business items: The C2C model in the aboveconcept can understand the transaction of circulating products made bycustomers with each other, they are not large corporations that produce items, soproducts will be limited and those facets circulate will rarely be seen in the

market Those reasons make loss of revenue to others But the C2C model is stillbeing watched by customers.

Higher margins for merchants: Products created and transacted in the C2Cmodel are not items produced by businesses or factories Therefore, the profit forthe seller is higher

Lack of control in quality and payment: Because trading activities areproducts created by individuals and not related to businesses, it is difficult forthose products to be properly tested to ensure a reasonable price And when thetransaction may incur some unexpected fees

1.5.3 Activities of C2C

Auction: This activity is a form of individuals selling or posting theirproducts on an e-commerce platform and if buyers are interested in that product,they will offer a suitable and highest price That person will be in possession ofthe product A typical example of this activity is the global auction site eBay.Exchange transaction: An exchange activity in the form of items for itemsbetween users Of course, the exchange items have the same price

Support services: Because transactions in the C2C model are betweenstrangers, may not be reputable, so support services are born to solve problems ofquality and safety Can include Paypal service to support payments, for example.Selling virtual property: Is the product or property of the characters in thegame They will bring their products in games and trade with each other

1.5.4 The development potential of C2C

Currently, it can be seen that the C2C model has been developing very wellbecause many products are researched and used by individuals in accordancewith the goals of consumers In particular, products are increasingly beingoffered for sale, so third parties will increasingly reduce costs to attractindividuals to use their exchange Along with that, the popularity of onlinechannels makes the C2C model an indispensable business channel for retailers.You can look at eBay and Amazon to see the growth of C2C These are the top

two prominent C2C providers today eBay as mentioned above is an auction site,where you can put up products for customers to bid on.

Chapter 2 INTRODUCTION ABOUT SHOPEE AND

Picture 2.3: In 2015, Shopee was launched in 7 markets across the region.

Source: Careers Shopee

Picture 2.4: Shopee’s headquarter in Singapore Science Park.

Picture 2.5: Shopee’s Office from now (2022)

Source: Career Shopee

In 2020, Shopee is the most popular e-commerce platfrom in Southeast Asiawith a total average of 281,385,626 milion visitors

Picture 2.6: The top 10 mosst visited e-commerce websites in Southeast Asia

in 2020 Source: Similar Web 2020

Shopee commerce platform is built to provide users with an easy, safe andfast experience when shopping online through a strong operating and paymentsupport system

When its operation started in Vietnam, Shopee operated under the C2C(Consumer To Consumer) model - being an intermediary in the buying and

selling process between consumers However, at present, Shopee Vietnamoperates under a hybrid model, including B2C (Business To Consumer) - anintermediary in the buying and selling activities of businesses with consumers.

In Vietnam, at first Shopee operated under the C2C model

At present Shopee Vietnam operates under a hybrid model, including B2C.According to the Business Overview Report of the e-commerce floor in thefirst half of 2022 of the data research company Metric.vn, Shopee accounts for72% of the market share in the Vietnamese market with sales up to VND 43,118billion since November 2021 to May 2022

2.1.2 Achievement

From 2015 – 2022, Shopee gained a lot of achievement, such as:

In 2015, Shopee was launched in Singapore, Indonesia, Malaysia, Thailand,Taiwan, Vietnam and the Philippines

Picture 2.7: In 2015, Shopee was launched in 7 markets across the region.

Source: Shopee Career

In December 2015, Shopee University held its first training course inTaiwan Currently, there are about 70,000 sellers in all markets who havebenefited greatly from these courses

Picture 2.8: Organize the first Shopee University course.

Source: Shopee Career

In June 2017, Shopee Mall was launched in Taiwan Currently they haveover 11,000 sellers in our 7 markets

Picture 2.9: Introducing Shopee Mall across the region.

Source: Shopee Career

In 2018, our Gross Merchandise Value (GMV) reached US$10 billion withover 600 million transactions on the platform

Picture 2.10: Achieve GMV more than 10 billion US dollars

Source: Shopee Career

In May 2018, Shopee kicked off the first Super Brand Day in Indonesia withP&G as Shopee's partner Since then, Shopee has organized 70 Super Brand Daysacross the region

Picture 2.11: Super Brand Day Source: Shopee Career

In 2018, Shopee announced BLACKPINK as Shopee's Regional BrandAmbassador ahead of the Shopee 12.12 event - Super Sale Birthday

Picture 2.12: Brand Ambassador for the whole region in 2018.

Source: Shopee Career

In 2019, Shopee announced Cristiano Ronaldo as their Brand Ambassadorahead of the 9.9 event - Shopee Super Shopping Day

Picture 2.13: Brand Ambassador for the whole region in 2019

Source: Shopee Career

In December 2019, Shopee sold 80 million items in a single day 12.12 Birthday Super Sale

-Picture 2.14: Shopee 12.12 - Super Sale Birthday

Source: Shopee Career

In 2019, Shopee had a total of 500 million views on Shopee Live and morethan 1 billion participation in games on Shopee's app

Picture 2.15: Shopee Live and In-App Games

Source: Shopee Career

2.1.3 SWOT analysis of shopee

Strengths

 Strong financial resources

Shopee's parent company - Sea Group - Southeast Asia's leading "TechUnicorn" with abundant money coming from the Garena game business Only inthe first half of 2021, Garena brought Sea Group a profit of $1.5 billion.Therefore, in the race to invest in the e-commerce market, Sea Group can stillhave enough capital to invest to maintain operation for Shopee

In 2016, Shopee Vietnam was invested 50 million USD by the parentcompany for the initial charter capital By the first half of 2018, this e-commerceplatform received more than VND 1,200 billion in charter capital from SeaGroup and this number is constantly increasing each year with nearly VND 2,500billion by 2021

 Strong communication

Despite appearing late, Shopee still made a strong impression on the publicnot only in Vietnam but also internationally with aggressive advertisingcampaigns Shopee's advertising images appear popular on major socialnetworking platforms such as Facebook, Google, etc

Not only that, this e-commerce platform is not afraid to spend money toinvite influential celebrities to represent the brand in promotional campaigns such

as Blackpink, NCT, Son Tung MTP, etc

Picture 2.16: Shopee x Blackpink Source: Manilaconcertjunkies 2019

Picture 2.17: Shopee x Son Tung MTP

Source: Shopee

Shopee is also one of the first e-commerce platforms to promote AffiliateMarketing to help marketing partners earn more commissions from successfulreferrals and indirectly help Shopee save marketing costs

 High market share

In 2020, Shopee is the E-commerce platform with the highest number ofdownloads and usage in Vietnam and the number one website in Vietnam withmore than 50 million visits per month

With the advantage of product source, partnership, logistics, sales person,marketing, customer service and business model combining B2C - C2C etc.Shopee becomes the leading e-commerce platform in Vietnam

 Good service quality

Flexible for 2 versions of mobile app and online website, pioneering thetrend of e-commerce on mobile platforms (M-Commerce & Mobile Commerce)Provide a variety of payment methods: COD, Card, E-wallet (Shopee Pay,Momo etc.)

Return policy helps protect the interests and create favorable conditions forbuyers

The buyer and seller protection policy is well appreciated

Many attractive promotions

Allows buyers to bid on products with sellers via Chat

Allow payment with Shopee Coins

Weaknesses

 Technology has not met the majority of users

This e-commerce platform (Shopee) has not yet met the needs of a largenumber of users at the same time Especially during super sales, Shopee userswill encounter many interruptions because the system is overloaded Therebyreducing satisfaction in the shopping process

On the other hand, the browsing and deletion of Shopee's products are alldone by machines, leading to the situation that many products or accounts aredeleted without reason due to inadvertent violations of some minor errors thatwill disadvantage sellers and buyers

 Difficult to control product quality and seller's reputation