Shopee Taiwan Co’s (樂購蝦皮) decision to start charging sellers a fee is likely to hurt the mobile auction app’s local business in the short term, but whether it would cause a long-term impact depends on what other measures it offers to retain users, the Market Intelligence and Consulting Institute (MIC, 產業情報研究所) said yesterday.
“Many sellers using Shopee’s platform are likely shift to other mobile platforms when the company begins the new charging mechanism next month,” MIC analyst Rosa Chang (張筱祺) said by telephone.
Chang said the company could try to ameliorate the damage by offering free shipping for a short period or providing discounts for credit-card payments, among others.
“It is worth monitoring to see if Shopee would launch new measures to keep its users,” she said.
Shopee on Wednesday announced that starting on April 17, it would charge sellers 0.5 percent from each transaction and 1.5 percent for credit-card payments.
The Singapore-based mobile auction app provider entered the Taiwanese market in 2015.
Its business grew fast in the past few years mainly due to the company’s strategy of offering free auction services, attracting 8 million registered users and more than 2,000 individual sellers, the company’s data showed.
TOP THREE
MIC’s research shows that Yahoo Taiwan Holdings Ltd (雅虎), PChome Online Inc (網路家庭) subsidiary Ruten.com (露天拍賣) and Shopee ranked as the top three consumer-to-consumer (C2C) auction platforms in the nation last year.
Yahoo Asia-Pacific managing director Rose Tsou (鄒開蓮) said the company was not surprised at Shopee’s decision to start charging fees, as a healthy C2C business requires a fee-based model.
“It takes time to build a reputation on an auction platform for sellers. I think the impact [on Shopee] will be limited,” Tsou told reporters on the sidelines of the company’s e-commerce event in Taipei yesterday.
Tsou said Shopee’s new policy is not likely to dramatically change the nation’s C2C landscape, with only a limited number of sellers moving from Shopee to other auction sites.
MOBILE PAYMENTS
In related news, an MIC survey showed that most Taiwanese used mobile payment services to pay for restaurant bills and transportation services.
The survey showed that 76.4 percent of the service was used for paying restaurant bills, 33.2 percent for transportation, and 19.3 percent for purchases of clothing, footwear, bags and accessories.
The survey also found that usage of mobile payment services has yet to pick up in the nation, with most people using them to pay smaller bills or amounts.
The poll showed that 66.7 percent of consumers used them fewer than four times per year and 86.9 percent used them for payments of less than NT$1,000.
Additional reporting by CNA
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