How the Industry is Evolving and What the Future Holds The E-commerce Revolution

Roger Egan, Co-founder & CEO of RedMart

Tangible Products Digital Products & Services

Agenda

Tipping Point

Evolution

Future

“We’re in the midst of a profound structural shift from physical to digital retail.”

- Jeff Jordan

The Tipping Point

Tipping Point: Profound Shift from Physical to Online Retail Due to Many Advantages of E-commerce

US Census Bureau

What matters to the customers?

Price Product Range Experience

E-commerce

Brick & Mortar

Advantages of E-com and how they relate to Price, Range, Experience

Experience

VS

Product Range

VS

Price

VS

Stores require a minimum footfall to cover their fixed overhead!

1!

As more people shop online, it creates a Vicious Cycle

Stores require a minimum footfall to cover their fixed overhead!

As traffic is diverted from store to online (RedMart or competitors), the store becomes more and more expensive to operate

1! 2!

As more people shop online, it creates a Vicious Cycle

Stores require a minimum footfall to cover their fixed overhead!

As traffic is diverted from store to online (RedMart or competitors), the store becomes more and more expensive to operate

The store’s offering and service becomes weaker and less efficient

1! 2!

3!

As more people shop online, it creates a Vicious Cycle

Stores require a minimum footfall to cover their fixed overhead!

As traffic is diverted from store to online (RedMart or competitors), the store becomes more and more expensive to operate

The store’s offering and service becomes weaker and less efficient

Causing more people to move online

Vicious Cycle!

1! 2!

4! 3!

As more people shop online, it creates a Vicious Cycle

SE ASIA ~$330 B Marketbut <1% online

Trend evident in VC Investment in E-commerce in SE Asia

Southeast Asia startup investments 2013, Tech In Asia

E-commerce

Brick-and-mortar

More people shopping online = less people shopping in stores

How the landscape is evolving

Platforms / Business Models and TrendsPlatform Players

B2C

Traditional Marketplace

"Asset Light", Instant Delivery Marketplace

Subscription

C2C

Platforms / Business Models and TrendsPlatform Players

B2C

Traditional Marketplace

"Asset Light", Instant Delivery Marketplace

Subscription

C2C

Platforms / Business Models and TrendsPlatform Players

B2C

Traditional Marketplace

"Asset Light", Instant Delivery Marketplace

Subscription

C2C

Platforms / Business Models and TrendsPlatform Players

B2C

Traditional Marketplace

"Asset Light", Instant Delivery Marketplace

Subscription

C2C

Platforms / Business Models and TrendsPlatform Players

B2C

Traditional Marketplace

"Asset Light", Instant Delivery Marketplace

Subscription

C2C

Platforms / Business Models and TrendsPlatform Players

Private Label and Value Added Services

Daily Deal / Flash Deals

Price Comparison and Social Shopping

Fulfillment / Delivery

E-commerce Software Platforms

+

Platforms / Business Models and TrendsPlatform Players

Private Label and Value Added Services

Daily Deal / Flash Deals

Price Comparison and Social Shopping

Fulfillment / Delivery

E-commerce Software Platforms

+

Platforms / Business Models and TrendsPlatform Players

Private Label and Value Added Services

Daily Deal / Flash Deals

Price Comparison and Social Shopping

Fulfillment / Delivery

E-commerce Software Platforms

+

Platforms / Business Models and TrendsPlatform Players

Private Label and Value Added Services

Daily Deal / Flash Deals

Price Comparison and Social Shopping

Fulfillment / Delivery

E-commerce Software Platforms

+

Platforms / Business Models and TrendsPlatform Players

Private Label and Value Added Services

Daily Deal / Flash Deals

Price Comparison and Social Shopping

Fulfillment / Delivery

E-commerce Software Platforms

+

Platforms / Business Models and TrendsPlatform Website /

Mobile Back End Merchandising Marketing Fulfillment Delivery Payment

B2C

Traditional Marketplace

"Asset Light", Instant Delivery Marketplace

C2C

Private Label and Value Added Services

Daily Deal / Flash Deals

Price Comparison/ Social Shopping

Fulfillment Some

E-commerce Software Platforms

“The Everything Store”VS

Fight head on

VS

Team up and provide instant gratification

+

E-Commerce Trends

VSSell your own products or provide value

added service & convenience

Lines blurring between Retailer and Manufacturer

+

Lines blurring between Logistics and E-commerce Companies

What the future may look like

!!!

!!

Business models, industries, companies, and services will converge into a controlled ecosystem.

The Great E-commerce Convergence

!!!

B2C

B2C and Marketplace Converge

!• Purchasing power • Bigger Selection • Faster, Less Capital Intensive Growth • Acquisitions - buys over

!!!

Marketplace

Delivery

Those that control entire supply chain and logistics win

FulfillmentManufacturing

Tech companies and E-commerce Companies Converge

Technology Companies

E-commerce Companies

Tech companies and E-commerce Companies Converge

Technology Companies

E-commerce Companies

Tech companies and E-commerce Companies Converge

Technology Companies

E-commerce Companies

Tech companies and E-commerce Companies Converge

Technology Companies

E-commerce Companies

Tech companies and E-commerce Companies Converge

Technology Companies

E-commerce Companies

Content, Community and Commerce converge

Internet Trends 2014, Mary Meeker

Content, Community and Commerce converge

Internet Trends 2014, Mary Meeker

Best Tech wins

Best, most seamless Ecosystems Win

+ + + + +

+ + + +

+ + +iOS

+ ?

+ +

Retailers become Manufacturers

Manufacturers

Convenience and Instant Gratification Key

Drone Delivery? 3D Printing?

Traditional Brick-and-Mortar must innovate or die

Innovate... or die.

Possible Implications

Opportunity to disrupt Retail Commercial Real Estate

?What happens to

Instant Gratification Models?

What will people do with their time?