Charles Debonneuil is the Group CEO of Intrepid Group Asia. Intrepid Group Asia is a 3-year-old company that manages the eCommerce presence of international brands on major eCommerce platforms like Lazada/Shopee across South East Asia.
Prior to this, Charles is also the co-founder and Chief Marketing Officer at Lazada Group, which he had been with since its early inception days as co-founder of Lazada Vietnam, Charles eventually took on the Chief Marketing Officer role of Lazada Group - and is taking care of marketing activities across South East Asia until August 2018.
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Kyler Tan: 0:00
and welcome to leaders in tech and e commerce law office. I'm your host Kinder from Alcohol Globo. Exactly. Such our mission is to connect with fashion is in attack and AECOM mystical system in Asia. By bringing forward some of the most interesting starts from the leaders in the industry. I'm happy to have the river shall receive. You know the Group C off interviewed group Asia Interview Group Asia Is a Tree is a company that majors e commerce presence for international prince on mutually Hamas platforms such as Lozada shopping a car service Asian record. These charges those to the co founder and chief marketing officer Lazada Group, which she had been with us since the inception. This as a court order off. Get now just eventually took on the chief marketing officer. Ruined proof, and it's taking care of the smuggling activities across service Asia. Until August 2000 and 18. Charles is going to have to get must dream my letter. Great. So maybe against everybody introduction off ourselves with our audience and get to know us both.
Charles Debonneuil: 1:02
Sure, sure. So, Charles, um I'm originally from France, been in the region in Southeast Asia for the last eight years. Now, I first came into the region. You have Vietnam, then lived in Thailand analyses before and pretty much the last eight years until Corona his That was, uh, on the plane every week between all of the office Asian country. I, uh, came to the region to be part of the tonic you move without also have been lucky to have witnessed the amazing evolution of the e commerce market in Southeast Asia. And to be part of the big mouthful on which was the entry of Alibaba into the region to the 16. When about 1/4 Levada. And the first year, year and 1/2 after on uba quarrel is that ah, uh, fortunate to go toe China every month or every other month and meet with the many executives about that really opened their books and showed us how, um, e commerce was run in China and I was major eye opener. Um, and, uh, this is, uh, uh What? Let me to my current role, which is, uh, you of, ah, intrepid group, uh, where we helped company to manage their e commerce presence across the major e commerce platforms like with Marshall pH try in Southeast Asia. And what a company does is very much inspired by what they call the TT model, which was created in China. What it means in practice is we help Global Brown's run their storefront and own the commerce platforms. We offer a digital marketing services these services tailored to e commerce. Ah, and we managed the full name of the orders. Uh, our third party partners. Um, so we have operations. Uh, we started getting I'm actually, but now have operations in Indonesia, Malaysia, Philippines, Singapore, Thailand, and Vietnam. Uh, so, uh, across the main, the larger Southeast Asian markets.
Kyler Tan: 3:10
Great. So maybe it is standing podcast by discussing a little bit about the marketplace. Since so many people haddock usually unconscionable in marketplaces profitably. Yes, but I saw a customer acquisition strategy. So as a senior leader, Baradei's within the marketplace of space right now. How do you see this school?
Charles Debonneuil: 3:28
Uh, sure. Um I think the lot of people say from investor decide that e commerce is an industry where companies burning on money. Um, but I think it's actually an industry where you have a very proven path to profitability. you have very profitable models in China without global, um, and in the U S or Europe with Amazon on. And I think one of the, um I mentioned that they often not, um, understood Well are taken into account. Um, is high monetization avenue of your digital marketing because the commerce platforms can make money together transactions that happened on their platform. But they can also become a very attractive place for advertisers to promote their product. And, uh, they can capture a significant share of the overall digital marketing Outspent. So that's something that, um, is, ah, uh, about pioneered on. And China represented a big chunk of the overall digital outspent, um, market and I'm a zone has been accelerating. And that's in the front over the last three years. So now it's, ah tender tender in dollar revenue for programmable. So from the, um, for the commerce platforms, Yes, it is a scale game. But once they acquire the scale, and so they need to spend money to attract users and prove their service excess, Robert wants their car the scale. Um, there's a clear path to profitability.
Kyler Tan: 5:02
He's actually a very interesting point for any audience that is not so familiar with Ali Baba. Right there is, Ah, advertising. I'm off Alibaba. It's called Ali Mama and I remember reading article some years ago that mentioned Al Imam actually caused part of our last number off Alibaba bus traveling chancellor. Do think this is possible for service. Asia's platform is ball Or given that demographic so different from China,
Charles Debonneuil: 5:28
well, it's, Ah, it's a difference Environmental together here in visual marketing, your Facebook and Google out strong foothold. Um but, uh, e commerce remained, and we'll know very attractive channel for advertisers to advertise a product. That's where you have the best audiences because you know exactly what people buy or what their brows. Um, you have the best context you can advertise while people have the mindset. Goodbye on. You have full visibility on the performance. What happened? What? Who clicks from what? Which means that, um, by definition, it's a really attractive place to ah to advertise. Hence, I think there will be a similar, um, past than we've seen in China or the US and Europe. Um, well, maybe not as rapid as in trainer, but, um, similar transected.
Kyler Tan: 6:20
Good for him. so talking about transcend given effect that e commerce industry is estimated to reach $100 billion by 25. And good thing for us is that we're seated here within the fastest growing region in the world. Right? What are the key trends that you're seeing here and what can be expected in the near vertical?
Charles Debonneuil: 6:38
Sure First, the the projection for 2025 e commerce industry have actually been revised recently by the Google Temasek Dane study. They revived it from 100,000,000,250 billion. Uh, going one year, they increased their projection volatile percent. Um, so it is. It is, I would say, uh, yeah, the, uh the hockey stick moment for the industry. If you want to say, uh I think there's, ah, a few ah, through dimensions. I would look at the first on the platform side, so you know, we more more platforms. Um, growing sense of 15 16. Before, when I started with LeBron that I was the main platform across the region. And, uh uh, in 2016 17 18 you started to have more and more players growing faster. You hade Tocopilla, local Apax and the tea. And, um I think, uh, at some point. And now you also have social commerce. That's been, ah, going force with Facebook and instagram. Um, I think that we're going towards, um, some form of consultation over the next Ah, 3 to 5 years. Um, again, looking at it from the consumers
Kyler Tan: 8:00
Charles Debonneuil: 8:00
I think they will have a handful of half of their on their phones. So probably, um, there will be a lot of our copy, maybe another local players when getting on. For example, there's, um, thin doing Kiki are supposed to, ah, to merge, uh, somehow. And, uh, yeah, maybe he's looking instagram. So I think that's a first round, which is conservation for the platform. And they're they're adopting the China's learning on getting more and more tools for others of brands to interact with Consumers Year. Their challenge is not to go too far and to make sure that the Browns are following
Charles Debonneuil: 8:45
and leveraging all the tools
Charles Debonneuil: 8:46
at their disposal. Um, but that's a very exciting development. Then for the sellers or the brands in particular, there's still a lot to go after was still in very early innings um, if you if you look at how brands of an approaching did you comers, platforms, um, in before to the 16 very few brown there to, ah, to go to e commerce. So pretty recent in 2016 17 you started to have some mass brands. Um and, um, things have been changing rapidly again. So, um, since last year and even more this year, we start to have more and more premium brands or in each brands that are coming on board. Um, you know, uh, the I think within the No. 23 years, probably all of the browns. You see, uh, here you're you know, or will be on the forms, then the You've seen that the early adopters have really increase their investments on the platforms on again. It goes to these topic of reaching psychological threshold the 5 10 20% of your world. Then they invest more and more resources onto the then if you look more on the other side. I'm not the brand sides of the seller side. You have ah long tail of others that are not really educated about e commerce. You don't really know how to our original the different tools yet, but I really eager to turn their hobbies, their hobbies, into actual businesses. So you see more and more success stories of, uh, people that started in their garage and selling products that they imported from China, where parts were produced locally next, their home and started telling on the button. And then, um, you know, trial and error trial and error, and then start to hire 1 to 5 50 people. Uh, please do me a lot more of these, and I think that's gonna continue to Ah, uh, explained I think in China you have a lot of these. Uh, how about millionaires that started from nothing and turned into a regards businesses? I think another that I mentioned to look at it through the trends s. So I think I talked about conservation of platforms and the how the platform is becoming increasing complex increasingly, uh, engaging for consumers and brown. Second is the adoption from Brown and Sellers. Um, the 3rd 1 I think we should be a destructive force on this is cross border e commerce. And so you have, um, a lot of brands or sellers, especially Chinese brands. that have a really strong know how on how to sell in all nine and have a very strong confidence in the model based on their experience in my home. And so they're coming in with very aggressive investment, and they know that it pays off to pay to invest heavily ahead of the curve. Um and so we see that these brands actually going faster than a lot of other global Brunt's on. I think that's very interesting because they basically have. Ah ah, what 10 plus years of learning in China and they're coming in much more aggressive than the local or global brands, and I think that could be a very interesting destructive force to see. So the question is, will global brands adapt and compete with, um um or will these brands, um, completely outpaced global? Uh, but the interesting development. We're still again in the early innings of that, because the conditions for cross border to really compete, um, are still being, I would say are still working. Progress, especially the shipping time of cross border orders, is still behind, significantly behind local fulfillment. Local the only time when you buy locally, but it's improved its improved tremendously in the last 23 years. Um, so again, within a year or two will be close enough that it will make such a difference for consumers to buy from local suppliers or from, ah, broad.
Kyler Tan: 12:57
Thanks for sharing so that you know of the stopping off brand adoption. And there's always been a debate off. Brenda converts Marketplace Channel, right? What is something on this topic? And what advice do you have? Friends that are still in the process off urinal.
Charles Debonneuil: 13:11
Well, um, I think this is evolving in quite rapidly, I think. More, more. Brand he, um but, uh, uh, these e commerce platform present such a bigger opportunity that they really cannot miss. And she looked at the consumer behavior in Southeast Asia, most of it to the transactions. Probably 90% under transactions. Any commerce happened. Yeah, so no individual finds, but if you think about it, consumers will not have on their phone the individual app for every single brand. Um, it's more likely that they have a handful of after the regularly go back to, um So, uh, in that regard, I think very few branch, um, can have Ah, very successful. Uh, Brendel, Come, um, if it's well executed, and it uh uh goes well with the strong brand presence ready. Um, and you have a specific value proposition for your brand dot com. Um, it can be Ah, very interesting. Uh, complementary channel. Um, for most brands, the pie on the e commerce platform. This is so much bigger. And I also has to do with, you know, the, um the, uh, 78 years that the the newcomer stop forms have been investing in, um, acquiring, uh, large base of users. Uh, e very efficient logistics. Uh, footprint, uh, payments. Ah, solutions. Which is very hard to replicate for individual brun, especially uh, on their platforms, whereby the, um uh, which are basically run by algorithms. And the more data signals you give the algorithms the higher rank on these platforms. So the earlier you go in and earlier, you build a customer base, the happy customer base, then the better your chances are two to have a long term possible business. I think there is a new element of, um, investment which will pay off a long term. And I think it's very easy to convince such bad because you have living examples in China. And so that's pretty, um, simple to make the argument. I think you look at the share of the retail that comes from, uh, e commerce in China. For a lot of brands, it's 50% 30%. 70%. Um, here in the region, it's much were much earlier, but in the last two years, things have been able he really fast. In last year's, it's hard to have brands that are heating 5% 7% 10 person, some even 20%. Um, So once you start to hit these psychological threshold, then brands really start to, ah, double down on their best. Any newcomers
Kyler Tan: 16:15
things were sharing. So at this point, where more brands investing online and expanding online, it's fall so they will result in a very comparative stays online right now. And as a marketing expert yourself, what advice we have all of these inner city?
Charles Debonneuil: 16:30
Yes. So I think we get the very beginning of a tectonic shift in the digital marketing landscaping substation so historically most of dependent on Facebook and Google. And um, I think the advertising on the economy platforms will become a much larger Share the news today, Uh, so here, same thing. There's an early mover advantage. There will be, ah ah, opportunities to buy cheap CPC the beginning and then, as competition intensifies, will let be the case. So here again, the topic of being an early adopter of these tools. And here I think, one of the challenges for bronze and in orphans parents he does also Why we were going to that place is a lot of the traditional agencies are not really equipped to service them well in that space. So reason why we cannot a lot of value is Well, we know how the, um, how the top ones work. And we can integrate your commercial strategy on the commerce platforms together, where your digital marketing and, uh, everything we do is optimized for our life. So again, on the e commerce platforms, you have the best targeting options. You have the best context. You have the best measure ability. And of course, you're the best performance because you're the lowest in the funnel. Um, so these are for advertisers these air channel, that just just make sense.
Charles Debonneuil: 18:04
Charles Debonneuil: 18:05
pretty obvious places to two other times I was finding again the right partner toe, uh, use these, general the best way possible again with an early mover advantage. So that's why we've set up Ah, stronger digital marketing capabilities heavy on tech toe. Be ableto automate a lot of the bidding optimization targeting optimization reporting to have full transparency for our clients.
Kyler Tan: 18:32
Thank you for sharing your bus. So feeling awful off saying that there be a shooting in the digital landscape off service Asian and we all know that how to stop it can tell right now. Isco Vered Night in, right. Could you share? That's what impact on this crisis have you noticed so far in the industry?
Charles Debonneuil: 18:50
Sure. So it's been very interesting that this difference with the, uh, conflicting um impact, which in the end produces a, um, very different types for different categories of products. So, of course, you have categories like groceries or essentials or work from home related categories that I've been skyrocketing then, um, they have been some other trends that have impacted negatively. So, for example, because of the economic uncertainty, there's a reduction in the discretionary expenses. Also, there's been a lot of supply Cheney shoes on. A lot of the sellers in the region get their supplies from China, so they've had difficulty to bring in the products. Then you have some countries that also adopted some very restrictive measures, also free commerce. So Libyans, for example, they restricted e commerce to only essential categories, so there was no delivery made for anything that's not groceries or directly essential potential category. So they have been kind of the two, uh, types of forces. Now you take a step back. It's a gigantic boost for the for the industry. Overall, if you look at it from Minter perspective, why the one of the big and costly challenge for the e commerce platforms is to get more and more users to not only come on their platform not only by but also by we keep the lead to the sort of home habit. And because Cove it has been such a widespread had such a widespread impact and such a long impact for several weeks in a rope. You have a lot of people that have never bought online that not only about one, but but repeatedly and so within a couple of months on the platforms I've been able to acquire a lot of new users and a lot of you engaged users. So this is, um this is going to be a massive boost, Long term for the industry. Eso So I think ironically or cynically, it's actually, uh, I think, Ah, strong propellant for the food industry,
Kyler Tan: 21:14
right? I think what was gonna agree that on this current situation, GIF Arlene actually really a big brochure in following when exporters will stc off in tribute book Asia. I'm sure receiving many requests from Brent. Orders are given huge hit on the offline retail Separate. So can you share? But what on some brands doing to come pick cocoa prices this fall?
Charles Debonneuil: 21:37
Yeah. I mean, I think for um, the main thing that comes to mind for me has been ah, wake wake up call for the brands and retailers that were not yet digitized or no yet leveraging you don't mind channel to their full potential. I think they realize that I mean, there are flying cells have been ah, obviously have the hit. Also, uh, there's this apprehension that it could happen again and they need to ah, rapid the full potential of these online channels. Uh, so I think that's been the main thing. So a lot of the question is How can the transition path? And I think we know that e commerce is going to become a larger and larger share of, ah overall retail. We have examples around the world, and there is no fundamental condition or parameter in the region that would go against that. I think it's just a week of call, an acceleration from from the brand tie to invest into e commerce.
Kyler Tan: 22:38
Right there is talk about the actual personal drove. Your transformation is actually
Charles Debonneuil: 22:43
Kobe night in Iraq. One
Kyler Tan: 22:46
very funny one. Yes, this is so mobile and advice, Charles like, extending the advice they can give us for this situation.
Charles Debonneuil: 22:55
I don't know what kind of It's a very broad question. I don't know what kind of advice I can give in general to be boring and what I'm qualified to do to do that. Ah, but maybe one thing I could say is, uh, for three doors that have a are impacted by this crisis and have lower business of the movement. Obviously, it's, uh, where you need to Ah, focus on your core and focus on improving quality of your products and services. Uh, about when the brighter days come, you can hit harder. I think it's a rare opportunity in a way to, ah, take the time to work on the things that we never have time to work on. And we know we should work on, um and, uh, yeah, and first time branded also means so I don't want to always repeat the same thing, but for some brand, it also means that if they haven't spent enough time, their e commerce strategy, it's also the time to, ah, to rethink. And he how does this compliment? There There were pro business and what needs to be done not just to be present, but to, um, be among the best in their category because it is, uh, you know, a competitive and an increasingly competitive marketplace in a way. And, um and so, uh, being present is not enough that it's about being present in the best way possible. Showcase her brand the best way possible. Find the right way it strange drunk with consumers to attract them to re engage them. Um, to have ah happy and engaging and engage story cultural bait
Kyler Tan: 24:28
actually agree on That is for actually and s dimension institution Give us the opportunity to do things differently and shopping, shopping, knife for better times to come. Very so jumps Thanks for sharing and it's really a pleasure to have. You must be sure. No, I think thank you for the opportunity again, I've been I'm fascinated by the commerce industry in general. Lucky to be at the heart of it for six years. And now Teoh help Global Brands Teoh. He's a full potential in this industry, and it's changing at a very rapid pace. Uh, we're really eager to Ah, a company, uh, companies that want to jump on the bandwagon and really stand out in the commerce marketplaces. Thank you for listening. Go vodkas for on the show notes and information discussed in this episode, please follow alka provo dot com slash pockets. Also, if it's interesting, it's obstructed about cousin iTunes. Spotify. What's teacher or one off the podcast Left way are looking forward to your feedback.
Charles Debonneuil: 25:41