Shopping has always been my passion. Beyond the excitement of acquiring a new item for my collection or the thrill of finding a great deal, I’m fascinated by the inner workings of the retail world. I often wondered how malls and brands stay relevant and capture consumer interest.
When I joined The Edge Singapore six years ago, I moved towards coverage of the retail industry, where a big part of the story was how e-commerce, especially at Lazada — with the backing of Alibaba, was seemingly unstoppable. Expectations were high — and met.
For a consumer like me, Lazada excelled by providing regular sales events, affordable delivery and convenient access to products from global markets.
Online shopping, in particular, became nearly indispensable during the pandemic, with Lazada’s ownership of the online grocery store RedMart further enhancing its appeal.
Lazada flaunted its success, with its communications team giving rapid and enthusiastic responses to my inquiries. Their repertoire of engaging anecdotes stood out, like the memorable tale of a RedMart customer whose purchase weighed as much as a baby giraffe.
At the time, Lazada held numerous sales, events and galas annually. The pinnacle was its 11.11 campaign. Like China’s Singles’ Day, this day became the company’s most lucrative revenue generator. Until 2021, the group consistently shattered its records on this day every year.
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Chun Li, then Lazada Group’s CEO, said in 2020: “Soon after we kicked off the campaign at midnight, we were already surpassing US$100 million in sales in less than half the time we took last year.” For some years, large-scale publicity events would be held in conjunction with 11.11.
Every November, I would anticipate a horde of press releases and almost real-time updates via WhatsApp from Lazada’s communications team, detailing how they had again vastly surpassed their sales figures from the year before.
For a taste of just how much they were crushing the e-commerce game three years ago, Lazada updated journalists with interim sales figures on the afternoon of their 11.11 campaign in 2020. That day, Lazada surpassed their previous year’s two-hour sales record in just 35 minutes; 16,000 items were sold every minute for the first 11 minutes past midnight.
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Throughout these interactions with the Lazada team, their pride was apparent. The e-commerce landscape was both fast-growing and competitive. Lazada was going head to head with other players in the market, like Shopee, part of Sea. The big hoorah by Lazada was a way to celebrate its wins or show its success to their competitors.
Either way, it worked, but only for a while. In my September 2022 interview with James Dong, group CEO of Lazada, and Loh Wee Lee, then CEO of Lazada Singapore, the two men painted an incredibly upbeat mood as the company was riding on the boom from the pandemic.
In my story, “Is the e-commerce business profitable? Lazada thinks so” (Issue 1056, Oct 10, 2022); Dong said: “We see a very good path to profitability in the next few years.”
But he would soon swallow his words. The global recovery from Covid-19 started another shift in the e-commerce space. Other hot-shot Internet platforms Shopee and then Grab were cutting jobs as they tried to speed up their paths towards profitability — or, at the very least, signal to investors that they are mindful of the need to be profitable and not just wantonly chase growth.
No more than a year after The Edge Singapore’s interview with Dong and Loh, things changed — slowly at first, then drastically, which led to the layoffs earlier this month.
The changes began subtly but did not escape my notice. Lazada’s enthusiasm and transparency around sharing its 11.11 campaign statistics disappeared. The team rejected my request for statistics they had so enthusiastically shared in previous years. Instead, all that was shared were the top-selling brands without specific numbers.
A contact from the communications team divulged only that the sales figures were “not as good as the previous year”.
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Things began to go downhill. One by one, the Singapore-based communications team left and they were not replaced. Eventually, the communications team at Lazada Singapore was gone, and the company also dropped its external PR agency.
Despite numerous attempts, The Edge Singapore has encountered a brick wall in contacting Lazada’s regional communications team and its newly engaged agency, tasked with handling the ongoing situation. Instead of meaningful engagement, our team has received only scripted responses.
Lazada is not the lone tech giant engaging in the “right-sizing” trend. This serves as a wake-up call for many. For consumers: Is the prevailing e-commerce model running on empty? Given persistent real-world inflation, will free shipping and flash sales become obsolete?
And for investors: These companies have dazzled with high-growth yet high-burn strategies — will profit after tax now take precedence over gross merchandise value? The Edge Singapore remains committed to unveiling more insights.
Read more about how The Edge Singapore broke the news of layoffs at Lazada:
- What's gone wrong with e-commerce? A look at Alibaba's Lazada, TikTok Shop and PDD's Temu
- Layoffs at US tech firms hit Singapore
- Lessons from Lazada for Singapore's employers and employees
- MOM notes 'good progress' in Jan 5 talks between Lazada Singapore and union
- Lazada lets go of C-suites; ex-staff in five of Lazada's six markets sharing CVs online
- Alibaba's regional online shopping unit Lazada marks new year with layoffs in Singapore
