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Following a bumpy 2017 which led to owners pulling out of its business, e-commerce platform Elevenia is bracing for an exciting year ahead with the backing of new conglomerate owner, Salim Group, by improving its competitiveness without getting dragged in to the price war that is dominating the e-commerce space.
In the last couple of years, Elevenia has struggled to keep pace with the growing competition the e-commerce industry, which has led to its two owners Indonesian telco XL Axiata and South Korean SK Planet Global to exit the business after years by selling their entire stake of the platform in August.
While this was a big blow for the e-commerce firm, the profile and track record of its new ownership is more than enough reason to be optimistic about the future.
Synergy with Salim Group
“Being in a big group [Salim], of course we will do many things that will give competitive superiority for Elevenia in the long term,” says Elevenia Chief and Sales Marketing Edward Killian Suwignyo in an interview with DailySocial.
The takeover by Salim Group did not come as a surprise as it has been known that the prominent Indonesian conglomerate, which controls numerous businesses in diversified sectors, have been trying to delve into digital business opportunities.
As part of its strategy to venture into the digital business, the group recently acquired Ina Perdana, a local bank, to allow the company to link its other services through digital payments and digital banking. The group has also recently partnered with Korean retailer Lotte for a separate ecommerce business in Indonesia.
Salim’s new vision is something Elevenia will be trying to benefit from. According to Edward, Elevenia has outlined its strategy for the 2018 which includes website improvement, training and education for sellers and talent development. However, he said that the main priority for Elevenia partner with its new sister companies under Salim, which would reinforce its development as a business.
“What is most important is to synergize with the other companies under Salim Group to build features and services that are innovative, different and relevant for the users,” he said.
Edward added that since its takeover, Salim Group has injected a “new motivation” and touch to Elevenia. Among the involvement of the new owner in Elevenia’s activities is the support of Indomobil, one of Salim’s subsidiaries, which provided Elevenia with a Renault Kwid as a grand prize in one of its activities. Elevenia has also teamed up with an Indofood product for a promotional offer.
With the backing of Salim Group, Elevenia is hopeful it would be able to deal better with the intense e-commerce competition than it did last year when it fell behind some of its rivals like Tokopedia and Shopee who have been able to reinforce their position in the market after receiving notable funding from investors.
Tokopedia announced earlier this year that it has raised a $ 1.1 billion investment from Chinese internet giant Alibaba, while Singapore’s Shopee received $550 million investment, most of earmarked for Shopee operation in Indonesia. These investments have enabled these platforms to be more aggressive in their efforts to attract customers.
Speaking to DailySocial in November, XL Axiata President Director Dian Siswarini made it clear that the decision to sell Elevenia was due to the increasingly tough competition in the rapidly growing e-commerce industry in the country. “Once big investors came with their big money, the opportunity to compete became smaller,” Dian said.
With money on their side, one of the strategies employed by the leading players is giving considerable discounts to customers. The promotions at the end of the year best reflects the price war between Indonesian e-commerce with sites like Zalora offering over 50 percent discounts for selected products while Lazada and Shopee offering up to 85 percent and 90 percent discounts, respectively.
Edward said that while Elevenia expects to be more competitive this year, it does not plan to be jumping in the bandwagon and join in the e-commerce price war as the platform is aiming to employ a “healthier” and more “long term” strategy.
“Our focus in 2018 is to build a competitive advantage that is long term in nature, not merely fighting a discount war. We will still compete in a healthier way by offering interesting promotions, but our main focus is to develop new features and services that are innovative, different and relevant to the needs of online buyers and sellers in Indonesia,” he said.