Shopee leads region's e-commerce user activity in Q2: iPrice

Singapore

A BOOST in marketing and entertainment efforts appears to be paying off for Shopee in its battle for regional e-commerce dominance.

The Sea Group unit had the most monthly active app users and heaviest web traffic in South-east Asia for Q2 2019, according to product comparison website iPrice. It places the company ahead of its largest rival Lazada, though Alibaba-backed Lazada still leads in four out of six markets in the region in terms of monthly active users on its app.

Shopee also took the crown for apps with the highest number of total downloads for Q2, followed by Lazada and Indonesian firms Tokopedia and Bukalapak. According to web analytics service SimilarWeb, Shopee's average monthly web visits was 200.2 million. Coming in second was Lazada, with 174.4 million visits.

The iPrice report attributed Shopee's growth to an increase in user interaction on its app.

"For example, Shopee created events directly on its app to entertain and encourage users to buy and sell on its platform. This was done in a myriad of ways from various entertainment shows such as music and sports, to programmes featuring pop culture figures," the report said.

But the firm's app lagged behind Lazada's in a majority of the markets surveyed, according to the report, which cited data from app analytics group App Annie.

Lazada led the pack for monthly active users in Malaysia, the Philippines, Thailand and Singapore. The Singapore-based group has similarly been ramping up efforts to boost seller and brand growth through a series of initiatives such as in-app live streaming and curated campaigns.

A higher number of monthly active users in Indonesia - the region's largest market - might explain Shopee's overall regional lead, even as the market remains dominated by local heavyweight Tokopedia. New York-listed Sea revealed in its recent Q2 results filing that in Indonesia, Shopee recorded a quarter-on- quarter growth in orders from 83.5 million to over 110 million.

Overall, Sea's adjusted revenue for e-commerce tripled to US$177.4 million from a year ago. It was boosted mainly by marketplace revenue, comprising transaction-based fees, advertising income and revenue generated from other value-added services. Gross merchandise value, which measures total sales transaction on the platform, increased 72.3 per cent to US$3.8 billion.

But with more aggressive initiatives to capture users, Shopee recorded higher sales and marketing expenses of US$163.7 million, an increase of 18.6 per cent. Despite a strong showing of revenue, the e-commerce player sank deeper into the red, chalking up an adjusted Ebitda (earnings before interest, taxes, depreciation, and amortisation) loss of US$248.3 million compared with a loss of US$188.3 million a year ago.