How does lazada work and make money?


Southeast Asia’s online economy hit $100 billion for the first time this year according to lớn Google and Temasek. By 2025, it is projected khổng lồ triple that.

One of itsmajor players is Singapore based Lazada. This article will cover how thecompany operates, its founding history and the various ways it makes money.

How Lazada Works and Operates

Lazada is aB2B2C marketplace mã sản phẩm in which so-called merchants sell goods on theirplatform. The company offers products in some of the following categories:

ElectronicsHealth& Beauty Groceries& PetsHome& Living Women’s& Men’s FashionAutomotive& Motorcycle

In order toprovide a seamless transaction for their customers, Lazada makes sure to lớn handlethe accompanying processes such as shipping, payment, or reclamations. Merchantstherefore only have khổng lồ focus on providing the relevant goods khổng lồ the most appropriatecustomer demographic.

Consumerscan choose to shop either on Lazada’s desktop trang web or any of the mobileapplications. Additionally, their LazMall siêu thị provides products, which havebeen authenticated for their legitimacy (as consumers in Asia often suffer fromfake and/or poor products).

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How Lazada Started: A Short History

If youthought Lazada was created by a local group of online entrepreneurs who justhappen khổng lồ have a knack for good branding, you’re wrong.

Lazada was founded in 2012 by German mạng internet investment và venture building company Rocket Internet. Rocket is most notably known for its copycat business model. It thereby replicates (mostly US based) companies and starts similar firms in parts of the world where that very same business mã sản phẩm does not exist yet.

Its operating mã sản phẩm is characterized by picking high performers (from firms such as McKinsey or Goldman Sachs) & arming them with capital and expertise. One of their most famous investments is European e-commerce giant Zalando, a direct replica of US-based Zappos. However, back to lớn Lazada!

The Lazada website launched in March of 2012. Its initial business model was to sell consumer goods such as clothing or electronics directly lớn potential customers (B2C). The company initially launched in Indonesia, Malaysia, the Philippines, xứ sở của những nụ cười thân thiện and Vietnam.

In 2013, the company added the current marketplace model (B2B2C). This allowed third-party sellers lớn offer goods on their platform. By 2014, that part of the business accounted for over 70 percent of all spending on the platform. Additionally, Lazada launched in Singapore during the same year.

Own Illustration

Othercompetitors in the space notably include Carouselland Bukalapak. We the latter, Lazada is said khổng lồ be in talks regardinga potential merger. The joint company would instantly become Indonesia’smarket leader.

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Does Lazada Ship và Operate Internationally?

Apart fromtheir trang chủ markets in Southeast Asia, Lazada recently started to enable merchantsto ship goods worldwide. The service is called LazadaGlobal Shipping (LGS). Lazada hereby takes care of fulfillment, rangingfrom packaging to lớn transportation.

Key Takeaways

Lazadawas founded by German tech venture builder Rocket InternetDueto a high cash burn, the company had khổng lồ be sold khổng lồ Alibaba for $4 billionWhilethe build-up certainly has been costly, Lazada seems khổng lồ be leading the pack inthe race for Southeast Asian commerce supremacy Itstarted to lớn implement a full shopping experience, both for merchants andconsumers Throughthe launch of more services và partnerships, Lazada will try lớn follow thelikes of grab and Go-Jek in becoming one of the region’s “super apps”