Presentation by Justus Wilde, Principle Strategist @ Amblique on 2013 vs 2014 shopper behaviour shift and the China opportunity.

1. 2014
Shopper
Index
&
The
China
Opportunity
Justus
Wilde,
Founder
&
Principal
Strategist
Online
Fashion
Success
Conference
Sydney,
23rd
March
2015

2. Today
1. Quick Introduction
2. 2014 Shopper Index Updates
3. China Market Opportunity
4. China Market Offering
5. Questions

3. § Est.
1999
–
now
subsidiary
of
eCargo (ASX: ECG)
§ 170
eCommerce
experts
across
AU,
VN
&
CN
§ Digital
commerce
consultancy
–
SELL
MORE
§ Strategy,
technology
&
trade
opUmisaUon
§ Demandware
top
Uer
partner
&
reseller

4. 2013 vs. 2014 revenue growth
2013 2014
NAB Online
Retail Sales
Index 16%
38%
9%
32%
Amblique
Retail Sales
Benchmark
Source: NAB online retail index and Amblique customer benchmark data 2014

5. ANZ peak sales are happening earlier
Top Sales Days
1. Boxing Day
2. 18th Nov
3. 19th Nov
4. 16th June
5. 7th December
Source: Amblique customer sales in aggregate 2014 vs. 2013

6. A
Demandware Shopper Index – 100m buyers

7. Source: Demandware Shopper Index 2014

8. Source: Demandware Shopper Index 2014

9. Source: Demandware Shopper Index 2014

10. Source: Demandware Shopper Index 2014

11. Source: Demandware Shopper Index 2014

12. Source: Demandware Shopper Index 2014

13. Key Findings
• The Demandware Shopping Index reveals 32% digital commerce
growth. Australia is growth at a sub global benchmark
• Cross-device shopping is increasing
• Smartphone traffic and orders are up sharply
• Shoppers are visiting AND carting more frequently
• Shopping visit duration is shrinking
• Android is taking share from iOS
• Discounts and free shipping are on the rise

14. China

15. China eCommerce outpaces US lead
Source: Tmall presentation

16. By 2020
China eCommerce will greater than
USA
UK
Japan
Germany
France
combined

17. 20 48 111 225
408
716
1,167
1,752
2,521
3,524
4,718
6,025
7,221
8,520
9,883
0.3% 0.6%
1.1%
2.0%
3.7%
5.7%
8.1%
10.3%
12.8%
15.6%
18.1%
20.1%
21.0%
21.9%
22.7%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
-
2,000
4,000
6,000
8,000
10,000
12,000
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
China Annual eCommerce Retail Sales (excl. autos, fuel, and food)
eCommerce Volume (Billion, RMB) eCommerce/Total Retail
China online to be 20% of retail by 2020
Source: Tmall presentation

18. GMV Market share in 2014
Source: iResearch Global Inc.

19. 11/11 in 2014
1 MIN 11 SEC
Exceeding 100M
14 MIN 02 SEC
Exceeding 5B
38 MIN 28 SEC
Exceeding 10B
7 HRS 17 MIN
Exceeding 20B
(exceeding total amount of 2012)
Including
10B in
mobile sales
13 HRS 31 MIN
Exceeding 36.2B
(exceeding total amount of 2013)
15 HRS 29 MIN
Exceeding 40B
21 HRS 21 MIN
Exceeding 50B
24 HRS
57.1B
($A11.8B )
00:00 24:00
PC
75.97%
Mobile /
Tablet
24.03%
2013
PC
57%
Mobile /
Tablet
43%
2014

20. 11/11 Consumption Abroad
Canada
Russia
Hong Kong Taipei
Singapore
Malaysia
Australia
1
2
4
5
6
7
10
Brazil
9
America
3
Macau
8

21. 11/11 Consumption in China
Shandong
Shanghai
Jiangsu
Zhejiang
Guangdong
Sichuan
Beijing
Hubei
Hunan
Henan
7
9
8
6
1
2
10 4
3
5

22. Growth Potential – Shopper Penetration
Online Shoppers
302 million
Internet Users
618 million
Population
1.35 billion
Internet Penetration
46% in China
(vs 82% in U.S.A.)
Online Shopper Penetration
49% in China
(vs 64% in U.S.A.)
Source: Alibaba IPO Prospectus

23. Growth Potential – Domestic Consumption
Online Shopping
USD305 billion
Consumer Consumption
USD3.4 trillion
GDP
USD9.5 trillion
Consumer Expenditure as
% of GDP
36% in China
(vs 67% in U.S.A.)
Online Sales as % of Retail Sales
8-10% in China
(vs 8-10% in U.S.A.)
Source: Alibaba IPO Prospectus

24. Importance of Mobile Commerce
Source: http://www.forbes.com/sites/greatspeculations/2015/01/21/china-mobile-ends-2014-with-a-whopping-90-million-4g-users/
600 million
3G/4G subscribers

25. Importance of Mobile Commerce
Source: Alibaba IPO Prospectus
Mobile Phone is the first choice
for netizens to surf the internet
29%
17%
73%
Mobile commerce will take on a faster growth pace in China
Transaction
Volume
CAGR
(201-17)
49%
Mobile
23%
Online
VS

26. Social Media Popularity in China
80%
% of Weibo users
following Brands
8
Average number
of Brands
followed
50%+
% of Weibo users who would visit
eCommerce site after seeing
product information on Weibo
46’
in China
7’
in Japan
vs
Daily time spent on social media
91%
in China
67%
in U.S.A.
vs
% of netizens having social IDs
Micro
Blogging
Social
Networking Instant
Messaging
Video
Sharing Picture
Sharing
900
million
820
million
340
million
214
million
5.2
million
Integration of Social Media with eCommerce
Source: Alibaba IPO Prospectus

27. Shopping for Full-
price Products of
Brands (???)
Messages
Shopping for
Price
Shopping for
Price of
Brands
Games
China consumer changes

28. Source: strangeloop

29. Source: EY Advisory
• Only sell on Brand site
• Plan to grow and focus on Brand site
• Tmall Global as pilot
• Plan to develop and grow Brand site
• Plan to develop and grow Brand site
Current China Retail Strategies
• Plan to develop and grow Brand site
Offical
China-specific
brand site
Shopping
functionality
Tmall
China
Tmall Global
China-specific
brand mobile app
Shopping
functionality
Offical
WeChat
account
Shopping
functionality
Esprit
Lacoste
Forever 21
ONLY
GAP
North Face
I.T
Nike
Uniqlo
Levis
Lee
Vans
Coach
Armani
Tommy
Hilfiger
Zara
JeansWest
Australia
Karen
Millen
H&M
Michael Kors
DKNY
Ted Baker
Calvin Klein
Offical
Weibo
account
China-specific brand site
Brand name
Marketplace China-specific brand mobile app WeChat
Offline
Store
Model E:
Unclear
eCommerce
Operation
Model
Baidu
Brandzone
Remarks
Model A:
Multiple
eChannel
Strategy
Model B:
Focus
on Tmall
(supported
by
non-
transactional
brand site)
Model C:
Brand store
only
Model D:
Pilot on
Tmall
Global/
Tmall China

30. • Market leading retail supply
chain business in CN, UK, ZA &
ANZ
• 200+ major retail logistics
clients (mostly apparel)
• Global logistics infrastructure
• China expert resources
• ANZ leading ecommerce
consultancy & SI
• 30+ major retail brand
ecommerce clients
• Expert ecommerce team
• Strategic Demandware
partner & reseller

31. Global Coverage

32. eCargo eFulfillment centers in Melbourne, Sydney, Hong Kong, Shanghai, Singapore & UK
Proprietary IT technology and processes
eFulfillment – Warehousing and Logistics
Shanghai facility 2,500,000 sq.ft.

33. Model Studio
Mannequin Studio
Styleshoots
360 Degree Photography
Accessories Studio
Catwalk Studio
Editing, Styling
eStudio – Digital Asset Production

34. coreOS
DAM
Global Brand eCommerce Sites
China Marketplaces
PIM
WMS
CRM
Item
Inventory
Pricing
Orders
Customers
Client Systems
A
P
I
Studio & content production
Store Operations, Customer Service,
Trade Support & Digital Marketing
Retail Supply Chain
& eFulfillment
SYD
MEL
SIN
PVG
HKG
LHR
Store Apps /POS
JNB
Channel
Management

35. eCargo / Cargo Services Customers

36. Justus Wilde
jw@amblique.com
+61 413517477
Thank
You
&
QuesUons?