[ By The Edge ]
Ganesh: At Nuffnang LIVE, we basically provide a platform that enables people to sell on Facebook and Instagram. (Photo by Patrick Goh/The Edge)
WEI ji” — the two Chinese characters for crisis in Mandarin — underscores the current situation in the Covid-19 pandemic as it has undoubtedly put the business community in “danger” (first character) but presented it with “opportunity” (second character) as well.
Arguably, this is most evident in the e-commerce space.
Enforced on March 18 in Malaysia, the Movement Control Order (MCO) to curb the spread of the novel coronavirus spelt disaster for businesses as most were rendered inactive for a long spell.
Upon realising the sudden but expected surge in online shopping activities during the partial lockdown period, three parties quickly came together to create a solution that took live commerce on social media to a whole new level.
“We were looking at this business and it just so happened that it was during the MCO,” Singapore-based Netccentric Ltd director Ganesh Kumar Bangah says of Malaysia’s first-of-its-kind Nuffnang LIVE, operated by Nuffnang Live Commerce Sdn Bhd.
A digital media firm listed on the Australian Securities Exchange with key markets in Malaysia, Singapore, Thailand and Taiwan, Netccentric owns Nuffnang Sdn Bhd — an established “influencer” and content marketeer in Malaysia and throughout Southeast Asia.
Nuffnang boasts the largest influencer platform by revenue in the country with over 13,000 celebrities, personalities and content creators across the spectrum, and a collective reach of about 10 million, Ganesh tells The Edge.
So, when Netccentric inked a pact with Commerce DotAsia Ventures Sdn Bhd and Docono Holdings Sdn Bhd to form Nuffnang LIVE, they created a comprehensive live e-commerce ecosystem like no other in Malaysia. Docono — the developer of the Bid Go Live! platform — is essentially the technology partner in the joint venture (JV). Under the agreement, its co-founder Daniel Wong will assume the role of chief technology officer at Nuffnang Live Commerce to spearhead the technology development and automation initiatives of the group.
“Live commerce is basically a fusion of e-commerce and social media put on video. We see it a lot today on Facebook and Instagram where people sell their products on live videos. The problem is that these social media platforms do not have a checkout option.
“In China, it (live commerce) is structured. The Tik Toks and WeChats of the world are structured. But in Malaysia, on Facebook, it is not structured. So, what happens is, when you type out +1 [in the comment section] to buy an item, the seller would then send you a DM (direct message) for the next step. It’s all done manually.
“At Nuffnang LIVE, we basically provide a platform that enables people to sell on Facebook and Instagram, to have structured e-commerce just as if they’re selling on the marketplace,” says Ganesh, who is also Commerce DotAsia chairman. He is also a major shareholder of both Netccentric and Commerce DotAsia.
Commerce DotAsia owns a database of over eight million small and medium enterprises (SMEs) across seven countries. Last year, it had about 61,000 active merchants who sold US$375 million worth of goods in Malaysia. It is an all-in-one e-commerce ecosystem that integrates technology solutions, talent development programmes and big data insights for Southeast Asian businesses.
In addition, it also manages, syncs and integrates online orders, inventory and listings all under one platform, allowing users to sell on both local and international marketplaces such as Lazada, Shopee, PrestoMall, Lelong, eBay and Amazon.
How does Nuffnang LIVE work?
Application programming interface (API) is integrated with Facebook to provide seamless user interface from live streaming, automated order management, online payment and fulfilment.
Artificial intelligence (AI) technology also ensures automation for end users to order and purchase.
“It’s AI-based, so when you press +1, you will receive a notification to confirm your order. Then, you will be directed to an online payment platform to complete the purchase. When this is done, you will receive a notification of order paid.
“Although payment is made by the buyer on Nuffnang LIVE, the payment is kept in the platform until the order is marked complete by the courier. This provides a secure transaction environment while protecting the buyer,” Ganesh explains.
While these features can also be found on Lazada and Shopee live commerce platforms, Ganesh says Nuffnang LIVE’s advantage is that it rides on social media platforms such as Facebook, which has a larger audience base.
It also offers businesses or sellers a complete range of services including warehousing, dropship, fulfilment, delivery and merchandising platforms all under one roof, thanks to its collaboration with Commerce DotAsia.
In essence, Nuffnang LIVE serves as a live commerce enabler for micro-SMEs (MSMEs) looking to expand their e-commerce business.
“The whole idea is not just the technology, it’s also the [audience] reach. We want to get Nuffnang’s 13,000 influencers to basically sell products for brands,” says Ganesh, who also founded US-listed e-payment enabler MOL Global Inc.
“What we’re basically saying is, ‘Hey, I can build your reach using our influencers, I got the technology to automate it, I got all the back-end warehousing, delivery fulfilment infrastructure to help you’. So, for brands, it’s a one-stop solution.
“Our biggest differentiator is that we have everything under one roof — live commerce and influencers plus warehousing. There are so many influencer agencies out there but how many of them have e-commerce and live commerce platforms with warehousing all under one roof? None,” he notes.
According to Ganesh, live commerce began taking off between 2018 and 2019 after MSMEs started jumping onto the platform as a cheaper alternative to generate sales, against a backdrop of increasing competition and rising traffic acquisitions costs.
In China, in 2018, live commerce generated over RMB100 billion through transactions on Taobao — Alibaba’s premier customer-to-customer (C2C) e-commerce marketplace in the country.
A year later, the figure grew more than fourfold to RMB440 billion, representing about 9% of China’s total e-commerce transactions. This, according to Ganesh, included the RMB20 billion sales raked in during Singles Day 2019.
Closer to home, live commerce accounts for less than 5% of total e-commerce sales but is gaining steam, in line with the segment’s growing trend globally.
“We looked at trends across the world and realised that live commerce is a trend that’s coming up. We believe it’ll be 9% in Malaysia or maybe even more. We believe it is possible, given Facebook’s large audience,” says Ganesh.
“If you compare Lazada or Shopee with Facebook, you will see that Facebook is the ‘shopping mall’ where a lot of people travel, while Lazada and Shopee are basically the shophouses, to which people will go only when they have something to buy. So, we’re really targeting a niche that is fast growing on a platform in Malaysia that has the most amount of traffic.”
Under the JV agreement, Netccentric and Commerce DotAsia will collectively invest RM350,000 in Nuffnang Live Commerce at an issue price of RM1 per share.
Following this, Nuffnang Live Commerce will then acquire the intellectual property rights of Docono’s Bid Go Live! platform for RM150,000, via the issuance of 150,000 shares at RM1 per unit.
In terms of shareholding structure, Netccentric will own 40% of Nuffnang Live Commerce, while Commerce DotAsia and Docono will each hold 30%.
“With this platform strategy, we aim to connect multiple groups, including merchants, influencers and consumers, to create positive network effects. The beauty about this JV is that Nuffnang Live Commerce is set to bring forth strongly the strengths of all three shareholders into a single entity to capitalise on a fast-growing trend in e-commerce,” says Ganesh.