Kinnevik Rocket Capital Markets day 2014 - Lazada presentation

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22 May 2014 Kinnevik Rocket Capital Markets Day

Transcript of Kinnevik Rocket Capital Markets day 2014 - Lazada presentation

Page 1: Kinnevik Rocket Capital Markets day 2014 - Lazada presentation

22 May 2014

Kinnevik Rocket Capital Markets Day

Page 2: Kinnevik Rocket Capital Markets day 2014 - Lazada presentation

Disclaimer

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The information contained in this presentation is public information only, but it does not necessarily represent all information related tothe issues discussed or presented herein, or all views of the company. The information has been researched by the company with due careand all and any evaluations or assessments stated herein represent the company’s opinions. We advise you that some of the availableinformation has been independently verified and may be based on statements by third persons, but no representation or warranty,expressed or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of thisinformation or opinions contained herein. Certain statements contained herein may be statements of future expectations and otherforward-looking statements that are based on our current personal views and assumptions and involve known and unknown risks anduncertainties that may cause actual results, performance or events to differ materially from those expressed or implied in suchstatements. None of our team shall assume any liability whatsoever (in negligence or otherwise) for any loss or unrealized profitwhatsoever arising from any use of this presentation or the statements contained herein as regards unverified third person statements,any statements of future expectations and other forward-looking statements, or the fairness, accuracy, completeness or correctness ofstatements contained in the presentation, or otherwise made in connection with this presentation.

This presentation does not constitute an offer or invitation to purchase or subscribe for any investment and neither this presentation norany part of it shall form the basis of or be relied upon in connection with the entering into any commitment or contract whatsoever, and issolely intended to communicate information regarding the company, its business track-records and team members. No one should basetheir investment decisions on this presentation but should form their personal opinions on the basis of further available information andevaluations and assumptions. In addition, any prospective investor should consult its own attorney and business advisor as to the legal,business, and tax and related matters concerning any investment decision.

Page 3: Kinnevik Rocket Capital Markets day 2014 - Lazada presentation

Marketplace

C2C

Payment

B2C

Lazada Group is aiming to control the Southeast Asian eCommerce ecosystem as Alibaba does in China

Operating Model Similar Players

Fulfilment

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Launched Benefits

Spring 2013

Control supply chain

Build strong customer satisfaction, reputation and trust

May 2013

Expand assortment and reduce inventory risk

Improve economics

August 2013

Bring smaller sellers online

Seller split between MP / C2C

Sell refurbished and second-hand products

Spring 2014

Offer customers trustworthy and reliable payment options

Reduce costs for sellers

Spring 2014

Offer marketplace / C2C merchants and 3rd

parties eCommerce logistic services

Further drive operational efficiency

Page 4: Kinnevik Rocket Capital Markets day 2014 - Lazada presentation

Adaption of online department store model (Amazon and Tmall) in Southeast Asia

Project launch in February 2012 with all sites live during March

Targeting more than 500m consumers across 5 fast growing economies

HQ in Singapore with independently operating country offices

Singapore operations ready to be launched in May 2014

More than 1,700 FTEs across the region

Backed by leading sector specialists and investors:

Lazada was launched early 2012 to target >500m consumers…

Lazada Thailand

Bangkok

Pop: 68m

March 28, 2012

Lazada PhilippinesManilaPop: 108mMarch 31, 2012

Lazada Indonesia

Jakarta

Pop: 254m

March 26, 2012

Lazada Malaysia

Kuala Lumpur

Pop: 30m

March 27, 2012

Lazada Vietnam

HCMC

Pop: 93m

March 28, 2012

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Lazada Singapore

Singapore

Pop: 6m

Launching soon

Source: CIA World Factbook, July 2014 estimates

HK/Shenzhen

Sourcing hub

Jan 1, 2013

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…aiming at monetizing several converging mega trends

▪ Strong GDP growth with ASEAN-10 GDP expected to grow at ~5% p.a. in the coming 4 years

▪ Over 145m people expected to achieve a disposable income greater than 3k USD by 2015

▪ Young and growing population – 60% of the world’s ‘youth population’ in Asia Pacific

▪ eCommerce sales currently at ~1% of total retail sales but will rapidly catch up with China, were online shopping represented 7.9% of total consumption in 2013

▪ Internet savvy population with over 145m Facebook users

▪ Rapid adoption of low-cost mobile phones and tablets is accelerating shift to online

▪ Mobile as online access point is driving faster adoption of mCommerce where ‘always connected’ customers typically are more loyal and valuable

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Booming macro environment

Mobile to leapfroginfrastructure barriers

Rising adoption of online shopping

Lack of offline alternatives outside big cities

▪ Lack of shopping malls in rural areas and tier 3/4 cities positions online as the only real alternative

▪ Studies on China demonstrate how the average online shopper outside big cities has a higher share of wallet directed to online spending

Souce: Industry research, Lazada Group estimates

Page 6: Kinnevik Rocket Capital Markets day 2014 - Lazada presentation

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79

Q1 '13 Q1 '14

1 2

Already the #1 eCommerce player in all 5 markets…

0.50.71.01.3

1.8

2.63.3

3.84.1

4.64.84.95.15.45.65.86.06.76.9

Oct-12 Jan-13 Apr-13 Jul-13 Oct-13 Jan-14 Apr-14

3.8%

0.5%

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Wide reach with rapid growth in visits (m)

Brand popularity1 outgrowing competition Highly engaged2 interactions with targeted customers

Growth in Facebook fans (m) a testament of popularity

Source: Company Data, Facebook, Google Trends; Note: All numbers exclude Lamido1 Volume of Google brand searches in Indonesia, indexed; 2 Facebook engagement ratio in Apr. 2014 = Number of engagements / Number of fans

+41%

Apr-12 Aug-12 Dec-12 Apr-13 Aug-13 Dec-13 Apr-14

lazadabliblibhinnekarakutentokopedia

Page 7: Kinnevik Rocket Capital Markets day 2014 - Lazada presentation

252

387

527

723

967

121 144176

246

333

Q1'13 Q2'13 Q3'13 Q4'13 Q1'14

Active Customers (k) New Customers (k)

…with a rapidly growing base of active customers

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Rapidly growing new and active1 customers

Growing unique visitors base (m) Expanding share of mobile traffic2

Accelerating growth in orders delivered (m)

Source: Company Data; Note: All numbers exclude Lamido1 Number of customers placing at least one transaction (pre-return) within 12 months before period end; 2 Includes visits from Mobile, Mobile Apps and Tablets

11%14%

22%

27%

35%

Q1'13 Q2'13 Q3'13 Q4'13 Q1'14

26

3330

3741

Q1'13 Q2'13 Q3'13 Q4'13 Q1'14

0.20.3

0.3

0.5

0.7

Q1'13 Q2'13 Q3'13 Q4'13 Q1'14

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89% 86%78%

73%65%

57%50%

6%6%

6%6%

7%

7%

9%

3%4%

8%

11%14%

5% 8% 13%16% 20% 24% 27%

Q1 '13 Q2 '13 Q3 '13 Q4 '13 Q1 '14 Apr-14 Apr-14WE

Desktop Tablet App Mobile

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Evolution of traffic mix

Market leading mobile platform a key driver of growth

Source: Company Data; Note: All numbers exclude Lamido

Overview

▪ Android app with >1m downloads launched in June 2013

- Ranked among Top4 shopping applications in Google Play across all markets

▪ iOS app with >1/2m downloads launched in January 2014

- Featured as “Best New App” by Apple

▪ Dedicated mobile site for optimized user experience

▪ Official eCommerce partner with key mobile players such as LINE, WeChat, etc.

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Marketplace is ~40% of NMV

Marketplace reaching more than 40% of NMV

Source: Company Data for 1-20 May 2014; Note: All numbers exclude Lamido

Overview

More than 2,000 active sellers driving strong assortment growth and enabling multi-source price competition

Launch of cross-border marketplace out of Hong Kong

- Expansion of global market place model to China, Japan, Korea and RoW

Shop-in-shop for major brands across all categories

Multiple additional revenue streams

- Payments, delivery, warehousing, etc.

- Onsite advertising and other marketing services

- BI and analytics

Marketplace~40%

Retail ~60%

Page 10: Kinnevik Rocket Capital Markets day 2014 - Lazada presentation

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Non-electronics already representing >60% of sales

Overview Share of items sold by category

Electronics38%

Lifestyle39%

Health & Beauty

14%

Fashion7%

Other2%

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2

3 4

Source: Company Data as of April 2014; Note: All numbers exclude Lamido1 Includes Cameras, Computers & Laptops, Consumer Electronics, and Mobiles & Tablets; 2 Includes Home Appliances, Home & Living, Toys, Kids & Babies, Sports & Outdoors, and Travel & Luggage; 3 Includes Fashion and Watches; 4 Includes Automotive & Gadgets and Media, Games & Music

Lifestyle outgrowing other categories driven by assortment growth, partnerships and merchandising

Continued growth of Electronics fuelled by price competitiveness and brand partnerships

- Leveraging dynamics of marketplace to achieve price leadership without harming economics

Fashion share expected to grow rapidly in Q3 2014 following official launch

- Development of private label “LZD” and central purchasing of fast fashion brands

Strong Health & Beauty footprint thanks to assortment expansion and close partnership with key brands

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Thailand

11Main WH Fleet hub 2014Fleet hub today

Vietnam

Indonesia

Philippines

5k sqm 2nd generation WH in Bangkok

~100% COD coverage5k sqm 2nd generation WH in Jakarta

~70% COD coverage

Share of customers

~55%Rural

~45%Urban

Wide reach supporting a large and diversified group of loyal customers especially in rural areas

Malaysia

Source: Company Data as of April 2014

8k sqm 2nd generation WH in Manila

Inhouse fleet covers full Metro Manila today

~95% COD coverage

5k sqm 2nd generation WH in Klang Valley

Inhouse fleet covers KlangValley, Johor Bahru,

Penang today

~80% COD coverage

3k sqm 2nd generation WHin HCMC

Inhouse fleet covers Hanoi, Danang & HCMC today

~90% COD coverage

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Highly diverse and experienced management team

Maximilian Bittner

Group CEO

Responsible for Buying

Sohil GilaniCPO

Responsible for Product and Onsite Experience

Tim RathCMP

Responsible for Marketplace

Stein Jakob Oeie

CMO & CFO

Responsible for Marketing, Finance and BI/Data Management

Name Title Previous Experience

▪ Consulting▪ Private Equity▪ Investment Banking▪ MBA

▪ Consulting▪ Corporate Law

▪ Investment Banking▪ Online Marketing▪ MSc

▪ Internet Veteran ▪ eCommerce ▪ Usability

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Eugene ChistyakovCTO

Responsible for Web Services and Infrastructure

▪ Web development▪ eCommerce

Igor PezzilliHead of Business Development

Responsible for Malaysia, Lamido and Payments

▪ PE▪ Consumer, retail, luxury goods

Pierre Poignant

COO

Responsible for Operations ▪ Consulting▪ MSc

Platform/Ecosystem

Operational excellence

World-class IT

Page 13: Kinnevik Rocket Capital Markets day 2014 - Lazada presentation

THANK YOU

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