Three Emerging APAC Markets to Enter in 2021

Misha Pabari

May 12, 2021

Our newly launched ecommerce report on the Asia Pacific region profiled the key countries and trends that brands who want to enter these markets online or grow their ecommerce sales should be aware of. Japan, Singapore and Malaysia are three of the emerging APAC markets that offer consumer brands the best online growth opportunities in 2021.

Below we share some of the most important datapoints that you need to understand when you are first exploring whether any of these markets could be right for your brand. 

Japan is an attractive market for consumer brands

Though seeming to be a very technologically advanced market in many ways, online shopping penetration in Japan has lagged that of less economically developed Asian markets, standing at only 8%. Despite this, Japan is still an attractive market for brands to sell to consumers online, and there are three online marketplaces that between them provide good coverage of the market.

Rakuten Ichiba is a domestic Japanese marketplace which provides a platform for third-party sellers only. Amazon is the second important player; and sells goods directly as well as allowing third-party sellers. The third is a newer entrant PayPay Mall, which was launched by Yahoo Japan in 2019 and has taken its lead from Alibaba in combining a mobile payments app and online shopping destination.

Cross-border shopping is not as popular in Japan as other Asian markets, and so a local entity or marketplace seller partner is ideal for brands who want to list and sell their products on any of these three marketplaces.

Pattern emerging APAC markets - Japan

Emerging APAC markets: Malaysian ecommerce has government backing

The market’s ecommerce sales grew significantly in 2020 – up by an estimated 24.7% - and ecommerce is one of the pillars of the Malaysian government’s post-COVID recovery plan. We expect the shift to online shopping seen during the pandemic will only make it a more attractive place for Western brands to sell their goods online.

A connected population, increasing middle classes and a government commitment to support the growth of ecommerce explain why it’s predicted to be the next market in the region that Amazon would want to enter. However, if Amazon does enter the market it will have stiff competition from Shopee and Lazada, who currently lead the way in terms of share of online traffic.

Pattern Emerging APAC Markets - Malaysia

Singapore is a growing market for cross-border sales

Though the smallest country of those we have profiled, it is strategically important for those who want to sell online in the region. 73% of online consumers in Singapore have shopped with overseas sellers, and 35% of total online sales are cross-border. It is for this reason, Singapore has been cited as one of three emerging APAC markets.

Singapore-headquartered Shopee is the biggest online shopping site by traffic. It launched in 2015 and has used this base to expand to the other Southeast Asian markets it serves. The thinking is that Amazon may also use its base in Singapore to try to expand into other markets in the region, with Malaysia the most likely. Lazada and Amazon are next on the list of marketplaces by traffic share, and Singapore is the only Southeast Asian market where Alibaba – which owns Lazada - and Amazon are directly competing.

Pattern Emerging APAC Markets - Singapore

Each market covered in this blog is culturally unique, at a different stage of ecommerce development; and vary in the number and spending power of their online shoppers. That said, they have some clear factors in common that means the region, and individual markets should definitely be on the radar of Western brands who feel that they’ve maximised their growth potential in their home markets.

Download the full report here for more data on marketplace growth and key trends for the Asia Pacific region.

Contact us now to discuss how we could help to grow your Asia Pacific online sales or to learn more about how Pattern can act as your authorised partner for marketplaces such as Tmall, JD.com, Amazon and Lazada.

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1P vs 3P
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Amazon 1P vs. 3P: Pros & Cons Brands Need to Know

Whether you’ve been selling your products on Amazon for years or you’re just starting out, you’ve probably wondered if 1P or 3P is the best selling model for your brand. As the top ecommerce accelerator, and 3P seller, with deep experience on Amazon, we know there’s no “best way” to sell on Amazon—it depends on your products, long-term goals, and  capabilities. 

In a 1P, or first-party relationship, Amazon buys your product wholesale and handles most of the selling details. In a 3P, or third-party relationship, you’re an independent seller on Amazon’s marketplace, which gives you both more control over your brand and more responsibility for logistics.

Deciding between 1P and 3P requires weighing the various pros and cons for your business. Brands should consider several factors before choosing which strategy makes sense. Here is more information about the pros and cons of both 1P and 3P so you can make the best decision for your brand.

1P Pros and Cons 

Pros:

  • Amazon is a well-trusted brand and consumers may trust your brand more if it is sold by Amazon.

  • Your products are automatically eligible for Amazon Prime and two-day shipping.

  • Amazon handles all the logistics: taxes, ASIN, optimization, and customer service.

  • Amazon gives exclusive benefits, such as placement priority and advanced analytics tools, to 1P sellers.

  • Selling your products through Amazon 1P could be the most price efficient option for your brand.

  • You are basically free of inventory risk.

Cons:

  • Amazon has the control to sell your product at any price they see fit, even if it’s below your established Minimum Advertising Price (MAP).

  • You may lose profit margins.

  • Amazon will pay you less frequently than a 3P relationship.

  • You will have little control over availability of inventory on Amazon at any given time.

  • Amazon can drop you as a 1P seller at any time.

Many brands choose to sell on Amazon in a 1P relationship so they do not have to manage most of the logistics and simply prefer Amazon to do it.. In addition, having  a well-trusted brand sell your product is another top consideration in a 1P seller relationship.. 

3P Pros and Cons

Pros:

  • Gives you more flexibility and control in every aspect of the selling process.

  • Strengthens your brand presence.

  • Helps you gain better access to data.

  • Provides more control in the selling process (pricing, inventory, and product listings).

  • Offers complete control over how much inventory to list.

  • You can share inventory across marketplaces, when necessary.

  • Creative control to  develop listings with better optimized content to tell your brand story.

Cons:

  • Inventory risks.

  • Responsible to create purchase orders and handling inventory logistics.

  • You are responsible for your own customer service.

  • Brand must pay additional fees to Amazon for being a 3P seller.

  • Can be subject to account suspension.

Selling on Amazon in a 3P relationship  is an increasingly popular option for brands, and it’s easy to see why. Even though becoming a 3P seller may seem like more work upfront, it ultimately gives you more flexibility and control, a stronger brand presence, and better data access.

How Do I Become an Amazon 1P or 3P Seller?

You can only become a 1P seller through a direct invitation from Amazon. To become a 3P seller, the first step is setting up a Seller Central account. You’ll then provide relevant information and verifications before getting your account approved and finally listing and shipping your products. 

3P Partners and Other Selling Model Strategies

While deciding between a 1P or 3P relationship is a solid start, selling model strategy is a bit more complicated than that. In fact, there are 7 common selling models brands may consider. Two of these models are the basic 1P and 3P models we’ve already discussed. 

Other models include the following:

  • 3P Unmanaged: no active management of your brand

  • 2P: Fulfilled by Amazon (FBA) model

  • Hybrid: leverages both 1P and 3P strategies

  • 3P Network: you create a network of authorized sellers

  • 3P Partner: you partner with one exclusive ecommerce seller

Pattern Proves the 3P Partner Model Works for Brands

In our experience, the ecommerce executives benefit most from a 3P partner model because it provides the most freedom and marketplace control on Amazon, without having to worry about complex logistics. Pattern executes  a 3P exclusive seller model because it gives our partners  the freedom and control unavailable through a 1P relationship, while also taking on the stock, management, and risks that make 3P selling intimidating.

With Pattern as your authorized wholesale partner, we buy your stock and resell the products on Amazon as an authorized seller. Once we buy your product, we’re responsible for all inventory risk, and help you optimize your content and advertising while maximizing your brand protection and brand global distribution. Our sophisticated inventory forecasting, fulfillment, and logistics systems help us predict and manage your inventory, and our experienced teams handle everything from taxes to customer service.

Unlike a 1P Amazon seller relationship, we’re eager to involve your brand every step of the way, including when it comes to branding, promotion, channel strategy, and new product launches. We respect your brand by following all brand pricing guidelines and committing to never drop below MAP policies.

Interested in increasing your margins by transitioning to a 3P relationship and partnering with Pattern? Get in touch today.

Amazon's Sponsored Product ads
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What Are Amazon’s Advertising Products? Sponsored Product, Brand, & Display Ads

What Are Amazon’s Advertising Products? Sponsored Product, Brand, & Display Ads

Utilizing Amazon sponsored ads can be a smart way for a brand to drive greater traffic to a product listing and start increasing sales. While many brands still struggle to manage their advertising strategies, 30% of Amazon brand sellers increased their advertising budgets in 2022. As ecommerce executives (or even on the nose with VPs of ecommerce?)  approve their 2023 advertising budgets, it may be worth it to take a look at Amazon’s advertising products and the benefit they may have on increasing conversions. 

​​Pattern is the premier ecommerce accelerator with all of the expertise, data-driven insights, and technology brands need to gain control on Amazon and maintain their competitive niche. We know the high value of and how to utilize Amazon’s advertising products to drive the most traffic and conversions to benefit and accelerate your brand.

Here are Amazon’s three main advertising products you should know about in order to drive listing traffic to your products and increase conversions: 

For a brand executive who is selling their product on Amazon, you may not already know the differences between campaign type, so we will walk you through the differences and uses for each of these three ad campaigns.

Sponsored Product Ads

Sponsored Products are a mid-funnel advertising strategy that gives visibility to products above the top organic listings (see example below). This strategy uses custom keywords to get products in front of the consumers who are searching for them, however it can be used to capture new audiences as well.These cost-per-click (CPC) ads require no additional copy or images, but usually receive the most interaction of the campaigns and need to be monitored closely.

As you can see, these ads look just like an organic listing, however they say, “Sponsored,” on them. These types of ads can be especially effective forms of advertising because they tend to blend in with the organic results around them. With Sponsored Products, you can get your products in front of qualified customers who are searching for your product in such a way that doesn’t make them feel like they are being served an advertisement.

Sponsored Brand Ads

Sponsored Brand Ads are a top-of-funnel brand awareness tool and function on keywords. This ad format helps show a customer what they may be in need of and where to get it.  Commonly used to promote product lines or best sellers, a Sponsored Brand ad shows up as a banner above the search results (see example below). This type of ad requires that the brand showcase at least three separate products.

Unlike other campaigns used on the Amazon platform, Sponsored Brand ads require ad copy and a unique logo. These ads also can take customers to a custom landing page, or a page on the brand store, that way they get a clear and overall picture about who your brand is, what other products you sell, and why they can trust your brand

Sponsored Display Ads

Sponsored Display ads can be a tactic for top, middle, or bottom of the advertising funnel due to its varying targeting abilities. Although most commonly found under the bullet points of a detail page, these ads can also show in emails, newsletters, and even more locations off platform.

Unlike the previous ad campaigns discussed, sponsored display ads can target shopping behaviors, like repeat purchasers, similar product purchasers, and even people who viewed the detail page but did not buy. Sponsored Display ads help customers discover your brand, drive awareness, and create loyalty. 

The example above shows just one of the many placements Sponsored Display has.

Accelerate Your Sponsored Products With Pattern 

Rather than competing with each other, each of the three sponsored ad products focus on a different section of the sales funnel, allowing you to target your customers and hit your sales numbers, all while edging out possible competitors. When brands use these advertising campaigns, they can better optimize their ad budget to improve ROAS and build revenue. 

At Pattern, we have all the resources to help your brand build successful advertising and digital marketing campaigns on Amazon so you can increase traffic and conversions, which will in turn increase your revenue

How Pricing Changes on Walmart.com Affect Your Brand
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How Pricing Changes on Walmart.com Affect Your Brand

Walmart.com has announced important changes regarding the “Was Price” and promotions on the digital marketplace. These updates make it more important than ever to optimize your price through implementing proper strategies, controlling your distribution channels, and being intentional about your pricing strategy.

And, as with all digital marketplaces, succeeding on Walmart.com requires performing well in all areas of The Ecommerce Equation. Which means as you optimize your listings’ pricing, as well as traffic, conversions, and availability, your revenue increases.

Pattern has the resources ecommerce brands need to optimize on marketplaces for each factor in the ecommerce equation. We have the technology and strategists to help you improve your traffic, the brand dedication and passion to help you achieve greater conversions, connections to econtrol specialists who help brands regain marketplace control, and the data you need to be able to make smart forecasting decisions for better product availability.

Below, we’ll cover how Walmart.com’s recent platform changes impact ecommerce brands’ ability to drive traffic and conversions for their products and how to strategize around them to work best in your brand’s favor. But first, let’s go over the changes themselves.

Walmart.com’s “Was Price” and Promotional Changes

Walmart.com’s newest changes reflect their mission to be the leader in low, everyday pricing. Therefore, Walmart’s customers come to the platform and expect low prices no matter what. Overall, these updates give consumers more visibility into the value they’re experiencing and hold brands more accountable in the pricing information they display.

Promotional Policy Changes

  • Due to Walmart’s updates, in order for your products to qualify for a strikethrough and show “Reduced Price” or “Clearance” flags on Walmart.com, your product’s promotion must be at least 10% off the “Was Price.” (Note: “Reduced Price” is the most common type of badging. Your teams can request this badge when filling out promotion upload files.) 

  • To specifically qualify for “Clearance,” the product needs to be discontinued and no longer replenished after selling through the remaining inventory.

  • Although “Rollback” is sometimes seen on site, it is a form of 1P-only badging.

  • Walmart now prohibits promotions lasting longer than 365 days.

“Was Price” Changes

  • Walmart’s “Was Price” was previously loosely defined and manually inputted on Walmart.com as an MSRP. Now, stricter rules are in place with regulations in the broader market to encourage enforcement and protect consumers. 

  • The “Was Price” is now defined by these terms on Walmart:

    • Either the 90-day median price paid by customers for the item on Walmart.com (excluding special promotions like holiday campaigns, limited time deals, rollbacks, and clearance);

    • Or the median price offered by Walmart or Marketplace sellers for the item on Walmart.com for at least 28 out of the last 90 days (excluding special promotions like holiday campaigns, limited time deals, rollbacks, and clearance).

How to Strategize for Success

1. Plan for Promotions Well in Advance

To protect your “Was Price” from price erosion, be intentional when planning promotions. To be most effective in your promotion, you’ll want to be able to give your customers a large enough discount to qualify for the slash-through and reduced price badging. 

Without the right pricing strategy in place, your products are in danger of falling into deeper and deeper discounting as you chase the ability to achieve slash-throughs and proper badging. Without the slash-throughs and badging, you’ll lose the ability to easily communicate the increased value of your product and the traffic and conversions you’re trying to earn by running the promotion in the first place. 

2. Keep Pricing Consistent

It’s important to keep your products’ prices as steady as possible to protect your promotion periods. As you prevent high-low price fluctuations, you’ll be able to use slash-through prices and promotional badges like “Reduced Price” and “Clearance” to your advantage in driving better traffic and conversions for your listings.

Without the ability to display badging, a promotion falls flat even if the price has been dropped. With steady pricing over time, you’ll be able to keep a stable “Was Price” and ultimately enjoy more rewarding promotional periods long-term.

3. Establish Excellent Brand Control

It’s important to remember that the “Was Price” policy also applies to 1P and other 3P sellers representing your products on Walmart.com. Unfortunately, your other strategies will be ineffective if other sellers are breaking your MAP policy or playing the high-low price game. So, it’s more important than ever for brands to be conscious of their distribution channels and keep rogue and unauthorized sellers in check.

Find Marketplace Confidence with Pattern

By allowing Pattern to be the authorized seller of your brand’s products and working with Vorys eControl law firm to eliminate rogue sellers, you can be confident in creating and executing a powerful  selling strategy on Walmart.com and other digital marketplaces. As a 3P seller partner, Pattern is truly invested in our partners’ success, we’ll help you to create and execute a strategy that truly prioritizes the long-term performance of your products on digital marketplaces.

Contact us today to learn more about the changes on Walmart.com and how you can optimize your performance.