Asia Business Channel

Online shopping picks up momentum in Myanmar

Shop.com.mm (Shop), the Myanmar arm of China’s largest e-commerce company, Alibaba Group, generated sales of over US$90,000 (K143 million) in the first hour of its first-ever ‘Singles Day’ online sale on November 11. The occasion, also known as 11.11, is the biggest shopping event in China.

Shop, which is the largest online shopping platform in Myanmar, received more than 1,500 orders in the first hour of the day, most of which were placed via mobile phones, the company said in a statement.

Over 150,000 shoppers accessed its app on the day after Shop offered discounts on some 50,000 items, including mobile phones from Samsung, Xiaomi, Huawei, make-up and cosmetics and sports gear from Nike and Adidas.

Alibaba Group, which hit a record US$1billion in 11.11 sales in 85 seconds and almost $US10 billion in the first hour of the 24-hour spree, placed its bets on the Myanmar e-commerce market when it acquired Shop from Daraz Group in May.

The strong response to Shop’s 11.11 online sale, its first such project under Alibaba, underscores the rising demand and potential for e-commerce in Myanmar.

Daw Win Win Tint, chair of the Myanmar Retailers Association, told The Myanmar Times in a recent interview that: “Myanmar has mostly leapfrogged the era of shopping malls and other modern trade platforms into the digital age. In Myanmar, the modern retail trade will expand according to GDP but e-commerce will grow exponentially.”

According to Telenor, the Norwegian multinational telecommunications company, Myanmar has a mobile penetration rate of 105%, and 80% of people are accessing the Internet via smart phones.

Because of the boom in e-commerce, Myanmar authorities are now racing to develop legislation to govern the realm of e-commerce as more online users emerge.

Myanmar’s e-commerce market could develop even faster if the forthcoming legislation is aligned with the ASEAN e-commerce agreement signed in Singapore on November 12. The agreement, which was finalized after nine rounds of negotiations that began last June, aims to facilitate cross-border e-commerce transactions and foster greater regional growth.

Myanmar’s e-commerce market has great potential, but has to improve to build a thriving e-commerce marketplace. Customer feedback to Shop’s 11.11 promotion included comments that: “We welcome online sales fairs like 11.11. But Shop has some weaknesses like delays in arrival of orders or incorrect orders. If they can fix these weaknesses and provide the best service for customers, e-commerce can become even more attractive in Myanmar.”

In order to expand Myanmar’s e-commerce sector, experts say the following areas should be improved:

1. New laws on e-commerce should include regulations that raise trust in online transactions and consumers should have the right to return merchandize and receive refunds without the system being difficult

2. The government should reform the national postal address system so that it will be easier for businesses to deliver products door-to-door

3. The Myanmar Payment Union should also work on strengthening its card payment offerings. Local banks should extend its ATM services deeper into the rural areas.

U Mike Than Tun Win, CEO of online travel site Flymya, expects that over the next two years, around 20-30 million people in Myanmar will become digitally savvy, paving the way for substantial opportunities in the e-commerce space.

According to Win: “Myanmar people are very interested in online shopping as Myanmar was the last to digitize in the region, so Internet speed is better than in Cambodia and Thailand and people want to purchase online because it just takes a few minutes and is easy and efficient.”

Read 79