Winning search on Shopee

By 2024, Shopee annual sales in Southeast Asia are predicted to be more than twice those of competitor Lazada. (Source: Edge Retail Insight)   

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Many brands are facing a tough challenge in expanding or even maintaining ecommerce sales in the highly competitive markets of Southeast Asia. Securing a top position in search is critical to succeed on retail ecosystems and digital marketplaces in general, and that holds true for fast-growing ecommerce platform Shopee.

Edge Retail Insight, the market research arm of Edge by Ascential, forecasts that by 2024, Shopee annual sales in Southeast Asia will be more than twice those of competitor Lazada. Consumer brands must take urgent action now to understand and use Shopee’s growth levers to improve sales and market positioning both for today, as well as to prepare for the strategic pivot to the future of retail dominated by ecommerce.

In this report, we explore how companies looking to build engagement and loyalty with the Southeast Asian market can benefit from better understanding the growth levers of Shopee and why investing in search terms in key categories is key to obtaining visibility - and increasing conversion - on the digital shelf.   

Listen: Tom Bentley, Edge by Ascential Senior Insights Manager, ShiLing Koh, Edge by Ascential APAC Senior Insights Manager, and Chris Elliott, Edge by Ascential Head of Market Insights discuss the impact of Shopee and the importance of executing effectively on the leading marketplace in Southeast Asia. Fill out the form below to get a full recording of the webcast and PDF presentations.  

 

Digital commerce is driving retail growth

The number one driver of retail growth globally is digital commerce.  Edge Retail Insight’s own research finds that: 

  • Digital commerce will account for 37% of global chain retail sales by 2025
  • Online retail sales in Southeast Asia in 2021 will reach US$1 trillion
  • Indonesia is by far the biggest ecommerce market in the region, valued at US $422.2 billion. The next biggest is the Philippines with US $159 billion

The number of SKUs visible to consumers is shrinking fast as shopping moves online. While more than 200 chocolate SKUs could be visible on the shelf of a physical store, on a Shopee digital shelf, this number shrinks to 10.  On a mobile, that number goes down to four.  

That is why understanding how to get discovered on key digital marketplaces, like Shopee, is rising in importance - and appearing high up in the search rankings for hero categories is a priority to capture marketplace shoppers.   

Search's Significant Influence

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Search rankings really matter  

Search is a crucial part of the ecommerce sales equation, along with availability of products and conversion rates. Search is a driver to retailer sites and search is a driver on retailer sites. In the USA, on Amazon:  

  • 90% of purchases begin with search
  • 80% of clicks are from the first page of search results
  • The top 3 search items win 64% of clicks
  • Search engines account for 86% of the first step in an online consumer’s path to a purchase

Hacking the search algorithm on a digital marketplace effectively leads to: 

  • more conversions and more sales
  • Boosts the number of customers landing on your platform
  • Boost sales velocity on a short and long-term basis

Global and regional digital marketplaces have many similarities in terms of ambition and the desire to grow, but they each have their own unique characteristics and growth levers. They juggle keywords with sales volumes, stock availability and other factors in different ways. 
 

Shopee’s search algorithm: what you need to know 

  • Shopee algorithms penalise products that are out of stock 
  • Active participation in Shopee promotional campaigns boosts search rankings. An oral care category product we monitored saw a steady rise in search positioning during the course of a promotion. In another example, multiple promotion activities following recovery of stock availability led to strong search position organically for a floor cleaner product
  • The order of keywords does not impact search performance
  • The top five search results on Shopee are usually sponsored Investment in brand and product keywords will pay off in terms of conversion and sales uplift 

Paid search dominates top Shopee search positions

Product availability: impact on search

Product availability

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Optimising paid search: the matrix

Paid search is important, but it needs to be targeted. This matrix shows where you should be optimising your investment in search terms: 
 

Paid Search: Resource Allocation Matrix

  1. Paid Optimisation. Use paid search to drive short-term visibility, but remember it will only work for a short period of time.
  2. Organic Optimisation. Perform content audits to align digital assets with organic (non-paid) search trends on retail platforms
  3. Organic maximisation. Spot-check terms regularly to prevent competitive disruption
  4. Paid maximisation. This should be the focus for investment — aggressive use of paid search helps to maintain product relevance in crowded platform spaces

Hacking the search algorithm to boost conversion and sales

Make these a priority to rise up the search rankings 

Directly and indirectly increase traffic to your products on Shopee by prioritising the below:

  • Differentiate from the competition: Make sure your products are differentiated from the competition. You can do this, for example, by making sure all images are ecommerce and mobile friendly. 
  • Understand and comply with Shopee’s ‘rules of the game’:  Take the time to learn the specifics of Shopee’s ecosystem and all the aspects that will enhance your visibility or decrease your visibility. For example, always use a clear and uncluttered product image title, and make sure text fits within character limits and contains all relevant keywords — brand and product names and efficacy keywords.
  • Optimise for seasonality: Make sure your strategy plays to elements of seasonality in terms of search terms at different times of the year.
  • Content. Put relevant keywords in titles, and make sure menu categories are accurate. Spelling and grammar should be correct for primary as well as    alternative languages
  • Paid search: Provide consistent Paid Search support, invest in both brand and product keywords, at the right time in the right place for the right keyword. Balance search term investment across different brands and products to avoid internal cannibalisation
  • Invest strategically. Keep trying different approaches to find the most effective, and make full use of all data on sales traffic to optimally calibrate Paid Search
  • Promotion Mechanism: Participate actively in Shopee campaigns, using such tactics as Price Off and Gift With Purchase to enhance rankings
  • Credentials: Combine multiple variants under a single URL to provide higher recorded sales and stronger ratings reviews
  • Association: Always associate flagship stores with relevant brands 

 

Meet our search experts 

Tom Bentley, Senior Insights Manager, Edge by Ascential
Tom has 12 years of ecommerce experience.is expertise includes category management, digital marketing and analytics. He has a passion for creating strategies to win e-tail search and is currently helping major FMCG brands accelerate online sales with search a critical pillar. Tom has advisedNestle, L’Oréal, Mars, Pepsico and Danone among other major consumer goods manufacturers and worked for both Tesco and Rakuten before joining Edge by Ascential.

ShiLing Koh, Senior Insights Manager, Edge by Ascential
ShiLing has 10 years of professional marketing research experience with a proven history of working across categories, clients and countries, predominantly in the Customer Insights and Innovation spaces. She has rich experience in helping clients across different industries to turn data and analytics into rich insights, and devising strategies to help with their retail business growth.  

Chris Elliott, Head of Market Insights, Edge by Ascential
At Edge by Ascential, Chris focuses on demonstrating how the group’s portfolio of products can provide value to prospects and clients. Chris is adept at distilling large quantities of data into actionable insights. Chris’s insights and commentary have been featured in The Financial Times, The Guardian, Daily Telegraph, BBC, ITV and other international media.

Fill out the form below to access the full presentation and the event recording now!

Article by:
Andrew Hill
Client Director, Edge by Ascential APAC
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