Shoppee and Lazada - Southeast Asia's E-Commerce Grapple

Iconic neon orange logo and highlights, a myriad of ad-jingles, and constant huge sales, the iconic e-commerce platform of Southeast Asia– wait. Are we talking about Shopee or Lazada? Maybe both? These two e-commerce platforms dominate the Southeast Asian market - Shoppee at a whopping 66% of the global market, and Lazada behind at 18% as of 2023. In almost every SEA market, from Singapore to Thailand, Shopee is number one, with Lazada in second or third - in some places, these two platforms form a duopoly. These companies often engage in public rivalry, with ads seemingly "targeting" each others' prices. So what's behind this rivalry, and what does it mean for consumers in Southeast Asia and the world?

Well, the market began with Lazada, which is currently owned by Alibaba - China's largest e-commerce manufacturer. With significant investment from its Chinese parent, Lazada held majority share in almost every Southeast Asian market, even with regional competitors like Tokopedia in Indonesia. Lazada's platform, backed by Alibaba, focused on a seamless desktop interface. In 2015, Shopee came in and launched simultaneously in 7 markets, with a robust mobile app and localization to each SEA country - Singapore, Malaysia, Indonesia, Thailand, Taiwan, Vietnam and the Philippines. Shopee's mobile strategy won over Lazada, becoming the majority in all of these markets. Yet, Lazada remained with significant market share and developed a strong presence in Shopee's markets, remaining a major competitor.

Rivalries aside, Lazada and Shopee are perhaps one of the best-maintained duopolies, and a prime example of how companies driven by competition can actually change customer behavior - their competition drove the development of sophisticated mobile shopping and is partially responsible for the significant shift of retail from physical to digital. In fact, Lazmall launched by Lazada is now a digital mall with 28000 options. If you're in SEA, chances are that one of these companies have transformed the way you buy!

Being aware of how market forces can impact our behavior as consumers is important. Learn more about consumer responsibility here: https://readmomentum.co/episode-3-how-do-i-buy-responsibly/