Trends in retail and e commerce analytics by Sheji Ho, aCommerce Group CMO

1. Trends in Retail and E-Commerce Analytics October 2014

2. Singapore | Thailand | Indonesia | Philippines 2 Why I’m here today • Building data-driven products & acquiring users at Gilt.com, Moda Operandi, LivingSocial & Groupon • Took a data science class during my MBA • Undergrad in Industrial Engineering (math, stats, operations research)

3. Singapore | Thailand | Indonesia | Philippines 3 WhyYOU are here today

4. Singapore | Thailand | Indonesia | Philippines 4

5. Singapore | Thailand | Indonesia | Philippines 5 The REAL reason why you’re here today

6. aCommerce Creating the fabric for e- commerce in Southeast Asia

7. Singapore | Thailand | Indonesia | Philippines 7 Our company Our Vision Powering Ecommerce in Southeast Asia aCommerce means commerce anytime, anywhere, anything Our Mission Build Ecommerce technologies and services that help companies build brand value, acquire customers, drive sales, and scale their business

8. Singapore | Thailand | Indonesia | Philippines 8 Paul Srivorakul Group CEO Experience: CEO & Co-Founder Ensogo Group (acquired by LivingSocial), Admax, DMS Group, NewMedia Peter Kopitz Group COO Experience: Co-Founder & MD - Zalora, Rocket Internet VP, Head of Execution - ACL Bank Piers Bennett Group CFO Experience: CFO - Ensogo (acquired by LivingSocial) - DMS Group - ValuE-commerce John Srivorakul Group CTO Experience: CTO & Co-Founder - Ensogo (acquired by LivingSocial), Admax, NewMedia Tom Srivorakul CEO (Thailand) Experience: Co-Founder & MD - Ensogo(acquired by LivingSocial), DMS Group, NewMedia Adrian Suherman Co-CEO (Indonesia) Experience: VP of Digital - Telekomsel CEO (Indonesia) LivingSocial/DealKeren Hadi Wenas Co-CEO (Indonesia) Experience: Co-Founder & MD - Zalora, Rocket Internet Engagement Manager - McKinsey & Co Ray Alimurung CEO (Philippines) Experience: VP of Business Dev. - Lazada, Rocket Int. Sr. Product Manager - Amazon.com (USA) Our team Sabina Chang CEO (Singapore) Experience: Category Manager & Head Merchandiser - Apple, Amazon, Walmart.com Sheji Ho Group CMO Experience: Sr. Product Manager - Moda Operandi Head of Customer Acq. - LivingSocial, Gilt Groupe

9. Singapore | Thailand | Indonesia | Philippines 9 Our clients Retailers / Marketplaces Brands

10. Singapore | Thailand | Indonesia | Philippines 10 Backed by some of the biggest in the game

11. Singapore | Thailand | Indonesia | Philippines 11 Our presence across Southeast Asia Thailand Singapore Indonesia Philippines • 3000 sqm • 100+ staffs • 3600 sqm • 130+ staffs • 200 sqm • 20+ staffs • 500 sqm • Manila Metro • 20+ staffs Malaysia, Vietnam Coming soon

12. Singapore | Thailand | Indonesia | Philippines 12 Thailand fulfillment center: 3,600 sqm

13. Singapore | Thailand | Indonesia | Philippines 13 Brand Site Our E-commerce channels Popshop Storefront (Social Networks, Apps, Emails) Marketplaces & E-tailers (e.g. Rakuten, Qoo10, Elevenia, Lazada, iBuy Group, LINE)

14. E-Commerce in Thailand and Southeast Asia

15. Singapore | Thailand | Indonesia | Philippines 15 By 2020, over 60% of Southeast Asians will be online 24M 31M 18M 4M 55M 34M 194m New Internet users 360m Internet users Source: We are Social, Accenture, 2012 2010 2020 62% Estimated Internet penetration 25% 2010 Internet penetration

16. Singapore | Thailand | Indonesia | Philippines 16 Big room for growth for e-commerce in SEA Online shopping makes up just 1% of total retail sales in SEA. This compares with 8% in China and over 10% in the U.S. and U.K. 15.1 9.5 11 12.8 21.8 11.3 102.4 57.1 68.4 82.5 168.5 70.5 Indonesia Malaysia Singapore Thailand Vietnam USA Forecast Sales in Internet Retailing (% Value Growth) 2013-18 CAGR 2013/18 Total Source: Centre for Retail Research 2014, Euromonitor 2014

17. Singapore | Thailand | Indonesia | Philippines 17 E-commerce market in SEA is highly fragmented, unlike US 6.32 2.35 2.2 1.97 1.79 Vatgia.com Lazada sites 5Giay.vn Enbac.com Thegioididong.com 1.44 1.35 1.26 0.78 0.7 Avg.com Amazon Sites Lazada sites Indonetwork.co.id Apple.com 1.5 1.05 0.94 0.84 0.64 Amazon Sites Avg.com Alibaba.com Apple.com Groupon.my 1.73 1.34 1.15 1.09 1.03 Weloveshopping.com Rakuten Inc. Avg.com Lazada sites Apple.com 1.09 0.73 0.69 0.63 0.52 Amazon sites Apple.com Avg.com Lazada sites Multiply.com 0.68 0.53 0.44 0.33 0.26 Amazon sites Apple.com Giosis Group Alibaba.com Avg.com Monthly Unique Visitors (millions) of top 5 online retailers Vietnam Indonesia Malaysia Thailand Philippines Singapore In contrast, in the US, Amazon and eBay are the top two online retailers, with more than 250 million monthly unique visitors

18. Singapore | Thailand | Indonesia | Philippines 18 Mobile leapfrogging: Thailand vs China Thailand requires 1.5 vs 3 years to reach the same online penetration level as China’s post 3G 0% 10% 20% 30% 40% 50% 60% 2003 2005 2007 2009 2011 2013 2015 2017 Internet Penetration Internet penetration in China Internet penetration in Thailand 0% 10% 20% 30% 40% 50% 60% 2008 2009 2010 2011 2012 2013 2014 Smartphone penetration Smartphone penetration in China Smartphone penetration in Thailand Source: CNNIC, UBS estimates

19. Singapore | Thailand | Indonesia | Philippines 19 LINE Messenger Thailand only From unknown to dominant in 18 months 26+ million users in Thailand alone Single largest channel to consumers > Facebook > Print + TV + radio eCommerce engine Ensogo took 2 years and $4M to get to 4M members Line flash sales did it in 72 hours That is truly disruptive

20. Singapore | Thailand | Indonesia | Philippines 20 Online advertising is totally out of line In Southeast Asia, people spend 44% of their media time online, but only 2% of advertising spending is devoted to online advertisement; however, e-commerce is changing this Source: Euromonitor, Nielsen 51% 34% 5% 2% 32% 9% 15% 44% 0% 10% 20% 30% 40% 50% 60% TV Print Radio Online % of Total Ad Spend vs % of Total Time Spent on Media % Ad Spend % Time Spent out of line

21. Singapore | Thailand | Indonesia | Philippines 21 Key takeaways • BIG – bigger than US (2x), bigger than EU • Social – everyone is on social media (Facebook, LINE) • Mobile – well over 100% penetration in most markets • Internet focused – more time spent on the internet than on TV • Large gaps – absolute disconnect between time and money spent online vs TV • Growing fast – eCommerce CAGR 2008-2013 is 18.73% • Young – much younger population than US and EU • Less competition – not (yet) dominated by global players

22. E-Commerce Analytics: Trends and Predictions

23. Singapore | Thailand | Indonesia | Philippines 23 Trends and Predictions • Content is blending with commerce resulting in new business models leveraging bigger data sets • E-commerce will slowly take over advertising as primary monetization model, driven by disconnect between time and money spent online vs TV • Data will re-invent how e-commerce and advertising is done

24. Singapore | Thailand | Indonesia | Philippines 24 New business models are emerging Content Commerce

25. Singapore | Thailand | Indonesia | Philippines

29. Singapore | Thailand | Indonesia | Philippines 29 “The company has a Pinterest-like interface, and uses algorithms and machine- learning technology to adapt to a user’s tastes in order to show them products they like.” “While Pinterest began exploring how a user’s likes and interests can be programmed into a more personalized experience earlier this year and doesn’t really emphasize commerce, Wish is all about the art of the algorithmically enhanced sale.”

31. Singapore | Thailand | Indonesia | Philippines “Jet will distinguish itself from Amazon, eBay and others by pricing products based in part on their proximity to the buyer. That way, customers could potentially get their merchandise quicker and at lower cost.” “What are the hidden costs in e-commerce? Are there aspects of e-commerce that don’t make sense? And most importantly, how do we expose these inefficiencies and empower customers to eliminate them?”

32. Singapore | Thailand | Indonesia | Philippines 32 Marketing Interactive: Shitty Clicks or 5 Reasons You Should Fire Your Digital Agency http://www.marketing-interactive.com/5-reasons-fire-agency

33. Wrap-up

34. Singapore | Thailand | Indonesia | Philippines 34 Recap • E-commerce is BOOMING in Thailand • New business models are appearing, leveraging more and more data • MOBILE adds more complexity to data but cannot be ignored anymore • Big data and technology will change e- commerce, retail, and advertising

35. Singapore | Thailand | Indonesia | Philippines 35 4 P’s of Big Data aCommerce’s big data framework for e-commerce 1.Platform 2.Processes 3.People 4.Politics

36. Singapore | Thailand | Indonesia | Philippines 36 Keep in touch! • sheji@acommerce.asia • Skype: sheji_ho • LINE: shejiho • Mobile: 09 2265 1700

37. Thailand Office 946 Dusit Thani Building, 4th fl., Rama IV Rd. Bangrak, Bangkok, Thailand 10500 Indonesia Office Jalan Wijaya Timur II No. 13 RT 015 RW 002, Kelurahan Petogogan, Kecamatan Mampang Prapatan Jakarta Thailand Distribution Center 951/1 Soi Preeyanon, Sathupradit Road, Bangpongpang, Yannawa Bangkok 10120, Thailand Singapore Office #05-01, Block 71 Ayer Rajah Crescent Singapore 139951 Singapore | Thailand | Indonesia | Philippines 37 Thank you! Sheji Ho Group CMO, aCommerce E: sheji@acommerce.asia M: +66 (0)92-265-1700 Skype: sheji_ho Address: 946 Dusit Thani Building, 4th fl., Rama IV Rd. Bangrak, Bangkok,10500 Thailand

Trends in retail and e commerce analytics by Sheji Ho, aCommerce Group CMO

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Trends in retail and e commerce analytics by Sheji Ho, aCommerce Group CMO