Headline Nov. 04/ ''' AMAZON'S -ASIA- ALIBABA'S '''

''' AMAZON'S -ASIA- ALIBABA'S '''

*AMAZON & ALIBABA* TWO MIGHTY E-COMMERCE GIANTS, just so, set themselves up for a clash in Asia.

Increasingly, the companies are competing against each other on neutral grounds. And in Asia,  modern Singapore is an ideal place for a battle.

But retailing  online    is a very sensitive and a tricky challenge  :  Imagine satisfying customers who can't sit on cushions. For example :

This year, Boston-based  Wayfair  will sell around  $4 billion  worth of ceiling fans, dog beds, espresso machines, hot tubs,  and artificial Christmas trees [around  55,000  sold in the last  12  months]  online.

That's nearly double what it sold two years ago and just a little less than the home furnishings giant  Williams-Sooma,  which owns pottery Barn and West Elm.

It's a growth story that has proved  irresistible to Wall Street; Wayfair's stock price more than doubled this year to $71. But the big question hovering over Wayfair is whether the company can  ever make money  by delivering bulk furniture virtually free of charges.

ASIA,...... In Asia,  where Alibaba and Amazon are all set to compete......

BUT Southeast Asia is  Southeast Asia.  A diffuse area of  600 million people , the region is divided by politics,  language and culture. 

Some places are modern, like Singapore. Other places lack the roads and other infrastructure to get people what they need.

'It's a mix of urban,  semi-urban and rural areas, separated  by large distances and -in the Philippines and Indonesia -by water,'' said Mike Booker, a partner at the Southeast Asia arm of Bain.

''Cash on delivery is still prevalent, and other local prayers are in the fray.''

The challenges have forced Lazada, Alibaba's biggest Southeast Asian operation, to get creative.

In Vietnam local post offices take customers returns and give cash refunds. In Malaysia, customers can collect merchandise from lockers at 7-Eleven stores.

And in the Philippines, Lazada uses  gas stations as places where merchandise can drop off their goods and for delivery personnel to pick up.

''We're in the super, super, super early days,'' said Inanc Balci, who oversees Lazada operations in the Philippines.

Alibaba's international arm has seen its latest quarterly sales more than double in a year, in part from Lazada's contribution. Still, Lazada and its RedMart subsidiary remain a tiny, and unprofitable part of Alibaba's empire.

Max Bittner, Lazada's chief executive, said its Chinese parents has been willing to spend money to build a delivery capabilities and draw more customers.

''E-COMMERCE is an economy of scale game,'' Mr. Bittner said. ''I don't feel constrained in any way. I can go after this opportunity with the amount of firepower I need.''    

Amazon so far counts Singapore as its only  Southeast Asian Market, though industry experts  widely expect  it  will expand into other countries.

An Amazon spokeswoman declined to comment.

Until recently, direct competition between Alibaba and Amazon has been rare. Amazon has a modest presence in China. 

Alibaba sells goods in the    United States    through its  AliExpress platform but has backed away from further expansion efforts.

Southeast Asia could offer a test their vastly different business models in neutral turf.

Amazon owns more of the inventory it sells. By contrast, most of the Lazada's sales come from outside the vendors who use its platform as a digital middleman to reach customers.

That approach, which keeps costs low, is similar to what Alibaba does in China.  But in China, the company's Taobao platform has been accused of offering counterfeit goods. Alibaba says it is working to fight fakes.

Alibaba has a long lead over Amazon and is building up its infrastructure across  Southeast Asia.

In Indonesia, for example, it took a minority stake in August in another online marketplace, Tokopedia. 

Experts say Amazon could fight back by offering online Western movies and television programs as it does in the United States, which could increase its appeal with younger customers.

Amazon stumbled in Singapore initially when the service proved too popular, forcing it to turn away customers. But since the two companies have amped up their efforts to deliver more quickly to a growing group of customers.

As the RedMart warehouse on a recent visit, workers packed cartons- sometimes nine at a time -from bins holding piles of cereal boxes and canned fruits. 

For those who offer ways to improve the process, merit awards include movie tickets, vouchers and cash of up to $1,000.

Competing in the market is likely to be expensive, thanks to customer price cuts and rebates in addition to expansion costs.

''It's fabulous.'' said Uma Parameswar a Singaporean who works in fine arts management. Over two and a half years of using RedMart, she said, only once did she receive fruit that was less than fresh.

The enticements make her even more inclined to shop online. 

She says RedMart gives her a 5% discount on grocery bills plus discounts on using Uber's  ride-hailing and other services.

''It's saved me probably $200 in the last three or four months,'' she said. ''It's a fair bit.''     

With respectful dedication to these Two Great   E-COMMERCE Giants : Amazon and Alibaba, then Leaders,  Students, Professors and Teachers of the world :

See Ya all on !WOW! -the World Students Society and Twitter-!E-WOW! -the Ecosystem 2011:

''' Morning Star '''

Good Night and God Bless

SAM Daily Times - the Voice of the Voiceless