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Online retailers get smart

Published on Friday, 26 Apr 2013
Photo: iStockphoto

E-commerce ultimately relies on applications for facilitating online transactions. In the near future, these applications will turn our smartphones into mobile wallets, replacing cash, cheques and credit cards.

Google, through Google Wallet, is one of the major forces pushing this system. “Android devices will definitely build in Google Wallet in the near future. It will definitely pick up pace,” says Alan Lim, CEO of E-Services Group, a Hong Kong-based consumer electronics e-tailer.

Apple already has a digital wallet application called Passbook. It is also rumoured that the next iteration of its iOS mobile operating system will include a mobile wallet.

Online selling using social media platforms is another trend that, while having been much slower to take off, has the potential to become a goldmine for e-businesses. A number of firms have already developed sales apps that can reach out to Facebook’s millions of users (“F-commerce”) – though these have had mixed results.

Last January, one of the more popular exponents of F-commerce, Payvment, closed down and handed over its 200,000 merchants to a competitor, Ecwid, which reported 267 per cent sales growth in the fourth quarter of 2012.

Meanwhile, other start-ups, such as Soldsie and Chirpify, have recently announced the successful raising of fresh funds for their social-commerce platforms.

Facebook itself earns money from e-commerce through its Credits and Gifts apps, though the amount is miniscule compared with what it receives in advertising revenue.

Groupon HK, meanwhile, has a very active social media presence that it uses to engage its more than 500,000 Facebook fans. “We have one of the most-viewed business Facebook pages [in Hong Kong],” says Danny Yeung, CEO of Groupon HK. “It’s a way for us to be one step closer to customers by having them reach out to us. We also put out our deal offers on Facebook and if there’s anything people like, then they can go directly to our web page to make the purchase.”

Yeung adds that the company is also looking into a way for people to buy products on a Facebook page.

Groupon HK opened a brick-and-mortar concept store in Causeway Bay in November last year to further enhance customer experience by bridging the gap between the online and offline worlds.

“Since [the store’s] launch, not only has it become more convenient for our customers to pick up their products, it has also elevated their confidence [in the brand]. They feel that it’s really good that, even though we’re an online company, they’re able to meet face-to-face with our customer-service staff and see our store and logo. It separates us from the competition as well,” Yeung says.

“We have a lot of technology improvements ongoing right now, which we plan to roll out in the next few months. We just recently launched a merchant app, the Groupon Merchant Center, to enhance merchants’ relationship not only with us, but with their customers as well. There’s going to be a lot of innovation in terms of technology to further improve our platform,” he adds.

The company is also pursuing the concept of deal personalisation, which has already been deployed in the US.

“We’re looking at many areas to make us smarter, to personalise our deals, and for subscribers to see relevant deals. For example, you shouldn’t be seeing a hair removal deal if you’re a guy. Customers need to be targeted more specifically,” Yeung says.

Local consumers, however, may have to wait a few more months before they can enjoy the personalised experience.

“I don’t have the exact time frame, but it’s something that we plan to implement locally in the next few quarters,” Yeung says.

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