Key Considerations for Choosing the Right eCommerce Platform: Comparing Lazada, Shopee, Shopify and Amazon

This is part 2 of a 2 parts series comparing eCommerce platforms, for part 1, read it here on Medium or read the full article (updated regularly) on Soodo.

Key Considerations for Choosing the Right eCommerce Platform

1. Business Goals and Scale
2. Target Market and Geographical Reach
3. Budget and Financial Considerations
4. Brand Control and Customization
5. Logistics and Fulfillment Capabilities
6. Marketing and Visibility Tools
7. Technical Skills and Resources
8. Platform Ecosystem and Integrations
9. Regulatory Compliance

1. Business Goals and Scale

• Consider your long-term business objectives and growth plans
• Assess whether you need a standalone store or prefer to leverage existing marketplaces
• Evaluate the scalability of each platform as your business expands

Case Study: patchandbagel, a Singapore-based decor & gifts brand, started on marketplaces like Etsy and Shopee before transitioning to a Shopify-powered store to support their rapid growth and international expansion. During a quick chat, they however noted that while Shopify provides less transaction fees and allows reach worldwide, they had higher ROAS (Return On Ad Spend) advertising on Shopee to Singapore-based customers.

2. Target Market and Geographical Reach

• Identify your primary target audience and their preferred shopping platforms
• Consider the geographical markets you want to reach (local, regional, or global)
• Assess each platform’s strength in your target markets (e.g., Shopee and Lazada for Southeast Asia, Amazon for global reach)

Insight: According to a Statista report, Singapore’s eCommerce market is expected to reach US$8.9 billion by 2025, with fashion being the largest segment.

3. Budget and Financial Considerations

• Compare the fee structures of different platforms:
• Shopify: Plans range from US$29 to US$299 per month, plus transaction fees
• Amazon: Professional selling plan at US$39.99 per month, plus referral fees
• Lazada and Shopee: No monthly fees, but commission rates vary by category
• Consider the initial investment required for setup and ongoing operational costs
• Evaluate the potential return on investment based on each platform’s market reach and tools

Tool Tip: Use Shopify’s free profit margin calculator to help estimate your potential earnings across different platforms.

4. Brand Control and Customization

• Determine the level of brand identity and control you require
• Assess the customization options available on each platform
• Consider the balance between marketplace exposure and building a unique brand presence

Case Study:

marketplace reach in Singapore. The company maintains a strong presence on Lazada’s LazMall while also operating its own branded online store.

On LazMall, Samsung leverages Lazada’s “Brand Mega Showcase” feature to create a customized storefront that aligns with their global branding.

This multi-channel strategy allows Samsung to maintain strong brand control while also tapping into Lazada’s vast customer base in Singapore. For smaller electronics brands or new entrants to the Singapore market, this case study demonstrates how to effectively balance brand identity with the reach of established marketplaces.

5. Logistics and Fulfillment Capabilities

• Evaluate the logistics solutions offered by each platform:

1. Amazon FBA
2. Lazada’s Fulfillment by Lazada (FBL)
3. Shopee’s Fulfilled by Shopee (FBS)

• Consider cross-border selling capabilities if you plan to expand regionally or globally
• Assess the integration with local shipping providers in Singapore, such as Ninja Van and SingPost

6. Marketing and Visibility Tools

• Compare the advertising and promotion tools available on each platform
• Assess the effectiveness of these tools for your specific product category
• Consider the costs and potential ROI of marketing features

Tool Tip: Explore Facebook Collaborative Ads (CPAS) integration with Shopee for enhanced marketing reach.

7. Technical Skills and Resources

• Evaluate your team’s technical capabilities and the learning curve for each platform
• Consider the time and resources required to manage operations on different platforms
• Assess the availability of support and training resources for each platform

Resource: Utilize Shopify Academy or Amazon Seller University for free eCommerce training.

8. Platform Ecosystem and Integrations

• Examine the app ecosystems and third-party integrations available for each platform
• Consider how well each platform integrates with your existing business tools and systems
• Assess the potential for omnichannel selling and multi-platform management

Tool Tip: Check out Shopify’s App Store or Amazon’s Marketplace Appstore for a wide range of integrations and tools.

9. Regulatory Compliance

• Ensure the platform helps you comply with Singapore’s e-commerce regulations
• Consider features that assist with:
• GST collection and reporting
• Personal Data Protection Act (PDPA) compliance
• Consumer protection laws

Resource: Refer to the Infocomm Media Development Authority (IMDA) for guidelines on e-commerce regulations in Singapore.

By carefully considering these factors, you can make an informed decision on which eCommerce platform aligns best with your business needs in the Singapore market. Remember that the right choice may involve a combination of platforms or evolve as your business grows and market conditions change.

Expert Tip: Consider starting with a multi-channel approach. For example, you could launch a Shopify store for brand control and direct customer relationships, while also listing products on Lazada or Shopee to tap into their large customer base. This strategy allows you to leverage the strengths of multiple platforms while mitigating their individual limitations.

Conclusion and Next Steps

As we’ve explored throughout this comprehensive guide, choosing the right eCommerce platform for your business in Singapore is a crucial decision that can significantly impact your success in the digital marketplace. The landscape of eCommerce in Singapore and Southeast Asia is dynamic, with each platform — Amazon, Shopify, Lazada, and Shopee — offering unique advantages and challenges.

Key Takeaways

1. No One-Size-Fits-All Solution: The best platform for your business depends on your specific goals, target market, resources, and long-term strategy.
2. Multi-Channel Approach: Many successful businesses in Singapore leverage multiple platforms to maximize reach and minimize risks.
3. Balance of Control and Reach: Weigh the trade-offs between having full control over your brand (e.g., with Shopify) and accessing a large, established customer base (e.g., with Lazada or Shopee).
4. Operational Considerations: Factor in the operational demands of each platform, including logistics, customer service, and technical requirements.
5. Financial Implications: Carefully consider the fee structures, initial investments, and potential returns of each platform.
6. Regulatory Compliance: Ensure your chosen platform(s) can support compliance with Singapore’s eCommerce regulations.

Next Steps

1. Assess Your Business Needs:

• Clearly define your business goals, target audience, and available resources.
• Use our eCommerce Platform Assessment Checklist to evaluate your specific needs.

2. Research and Compare:

• Dive deeper into each platform using the information provided in this guide.
• Visit the official websites of Amazon, Shopify, Lazada, and Shopee to explore their latest features and pricing.

3. Test the Waters:

• Consider starting with a multi-channel approach to test different platforms.
• Many platforms offer free trials or low-cost entry options. Take advantage of these to get hands-on experience.

4. Seek Expert Advice:

• Consult with eCommerce experts or attend workshops offered by marketplaces themselves.
• Seek a complimentary consultation with us at Soodo eCommerce Venture Studio.
• Join online communities and forums to learn from other Singapore-based sellers’ experiences.

5. Plan for Growth:

• Choose a platform or combination of platforms that can scale with your business.
• Consider how your choice aligns with your long-term expansion plans, both within Singapore and internationally.

6. Stay Informed:

• The eCommerce landscape is constantly evolving. Subscribe to industry newsletters and follow eCommerce trends in Singapore and Southeast Asia.
• Regularly reassess your platform choice as your business grows and market conditions change.

Remember, the journey of eCommerce success is ongoing. Your initial platform choice is just the beginning. Be prepared to adapt, optimize, and potentially diversify your eCommerce strategy as you grow.

By carefully considering the factors outlined in this guide and following these next steps, you’ll be well-equipped to make an informed decision and set your eCommerce venture on the path to success in Singapore’s vibrant digital marketplace.

We wish you the best in your eCommerce endeavors!