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Philippine Business Magnate Sets Sights on E-commerce as Alibaba Increases Southeast Asia Reach

For the most part, the Philippines has relied on the more traditional means of trade

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BY Jared Carl Millan - 28 Sep 2017

Philippine Business Magnate Sets Sights on E-commerce as Alibaba Increases Southeast Asia Reach

PHOTO CREDIT: Getty Images

Although Southeast Asian e-commerce is relatively new, there is no question that it is increasingly becoming an intense battleground for companies aiming to capture a share of the region’s 600-million strong market.

Just last June, in an effort to increase its stake in Singapore-based e-commerce Lazada, Alibaba invested an additional $1 billion to the company, increasing its stake to 83%. And in July, U.S. e-commerce giant Amazon launched its Prime service in Singapore.

More recently, Alibaba has started to expand its reach even further. In a South China Morning Post report, Bien Perez says that the Lazada Group is extending its campaign to introduce a select range of Taobao merchandise in the region to Indonesia, the Philippines, and Thailand.

Now the Philippines is starting to catch up in the game of e-commerce as one of its most powerful business magnates — John Gokongwei of the Robinsons Retail Holdings empire — hastens his efforts to explore the opportunity that lies in the digital marketplace. For the most part, the Philippines has relied on the more traditional means of trade, through shopping malls and physical stores.

It is only recently that the Gokongweis have dedicated a more concentrated effort toward strengthening its e-commerce presence.

“Robinsons Retail Holdings Inc., one of three giants that dominate retail in the Philippines, has begun moving more of its $2.7 billion empire online,” reports a Bloomberg Technology story. The company plans to triple the number of supermarkets that ship web orders by 2018 according to Robina Gokongwei-Pe, the tycoon’s daughter and company president. It was also reported that other parts of the conglomerate, including department stores, will eventually follow.

Furthermore, Gokongwei-Pe also says in the report that they are seeing an “exponential growth in online retail,” and that shift toward e-commerce is the right move, given that the younger market is more drawn toward online shopping. She also considers the unpleasant traffic situation in the capital as another reason.

According to a report by Euromonitor International, the Philippines’ “Internet retailing continued to enjoy double-digit growth in 2016 in current value terms, driven by the strong domestic economy, a large base of Internet and mobile users, and strategic partnerships with store-based retailers and telecommunications companies.”

Furthermore, the Internet and Mobile Marketing Association of the Philippines (IMMAP) says that there has been, in the country, a 35 million Internet users in mid-2014 — a number that is only expected to grow to 70 million by 2018, according to the Euromonitor report.

In the same Bloomberg report, AP Securities Inc.’s analyst Grace Aller is quoted as saying, “Online retail isn’t going to explode anytime soon, but it’s good that Robinsons is making a push now while no one among the traditional retailers is leading in this space.”