Firm foundation
The size of Myanmar’s e-commerce market is approximately USD 6 million. However, it is expected to see strong growth in 2019 and expand rapidly within the next 5 years.
Current foundations in place to spur future growth in Myanmar’s e-commerce sector include a growing young and tech-savvy population, increasingly innovative door-to-door logistics solutions that has been adapted to meet local needs, and a vibrant start-up scene, with more of the young entrepreneural generation looking to develop new business solutions.
Steps in the right direction
On November 12, all Finance Ministers of the 10-member Association of Southeast Asian Nations Monday signed in Singapore the bloc's first agreement to facilitate e-commerce transactions in the region. The aim of the agreement is to foster speed and cooperation between businesses and governments, generating more efficient transactions. This has significant implications for the future of regional e-commerce. Meanwhile, at home, the Myanmar government also has eyes on developing its own legislation to foster the growth and strength of domestic e-commerce.
Growth is of course set to begin in Yangon and Mandalay, the two largest economic cities. And sectors set to benefit from the growth of e-commerce are retail, healthcare and tourism.
Bottlenecks still exist. The government needs to improve its legislative and regulatory framework to effectively govern the industry and take care of concerns regarding consumer protection, information privacy, security of financial transactions and cybercrimes, as well as a need for better logistic infrastructure and higher online payment penetration.
Players on the move
Despite this, a number of recent developments point toward positive prospects for the country.
SHOP.com.mm, the local arm of Chinese e-commerce giant Alibaba Group, sold over USD90,000 worth of goods in the first hour of its first online sale on November 11. The Myanmar version of Alibaba’s global “11.11” online sale was launched by Myanmar’s biggest online shopping platform, SHOP.com.mm. According to representatives of the company, over 1,500 orders were placed in the first hour, most purchases being made through mobile phones. To drive sales, the company offered discounts on over 50,000 items, and its shopping app was accessed by over 150,000 users.
SHOP.com is owned by Daraz Group, which was acquired by Alibaba in May this year. The SHOP.com website and its apps have been upgraded to include personalization features and data privacy protection according to the same standards and technology as Alibaba websites. The 11.11 sale was SHOP.com’s first mega sales project since its acquisition by Alibaba.
Another e-commerce operator, Barlolo.com, which launched in mid-2017 as a classifieds website for goods, had transformed into an e-commerce platform and now wishes to expand its operations nation-wide. The website displays goods from over 1,000 merchants. Barlolo aims to be the No.1 online marketplace that allows merchants to manage and showcase their products, along with ready logistics and payment solutions. The firm is currently hoping to expand its delivery nation-wide by collaborating with MPT and Myanmar Post and offer more payment solutions such as Visa and MasterCard.
Riding the trend in e-commerce, City Mart Holding Company Ltd launched its City Rewards mobile payment application which can be used at more than 200 of its shops and stores including City Mart, Ocean, and Seasons. The City Rewards application allows users to make payments and transfer money between users up to 100,000 Ks for free. According to CEO Daw Win Win Tint, the application is currently available for use with only retail stores under City Mart Holding Group. In future, however, it could be used at others retail stores as well, and users will be also be able to make payments for meter bills, phone bills and bus fares.
Bright prospects
All this points toward a bright future for e-commerce in the long run as supporting factors and various infrastructures are put in place. Myanmar’s retail market is expected to leapfrog past the shopping mall age into the digital age, and those looking to sell products in Myanmar should not overlook e-commerce as one potential channel.
