Karana gets US$1.7M seed funding for its ‘whole plant-based’ meat alternative made from jackfruit; Investors include Henry Soesanto, CEO of Monde Nissin, foodtech fund Germi8, Big Idea Ventures; Karana will also use the funding to launch its plant-based products in restaurants in Asia. More here

Has COVID-19 pushed us into the digital future?; If the pandemic has exposed anything, it is the need to transform the industry “T minus ten minutes” from now; However, the digital transformation we need has to balance between machine intelligence and human imagination. More here

Here is what a bag of popcorn can teach us product pricing; ‘Anchoring’ may be one of the simplest and most powerful tactics you can use in your pricing; It’s about using the human need to make comparisons in order to make supposedly rational and correct decisions; It allows us to hack our customers’ brains, influence their decisions to a certain extent. More here

Zilingo cuts Singapore and global headcount, puts Singapore HQ up for rent; The fashion e-commerce startup has laid off another 11 employees as part of a 12 per cent global cut to its staffing; In April, the Temasek-backed startup had laid off less than 5% of its 796-strong global workforce. More here

Myanmar’s telemedicine startup MyanCare secures US$600K led by SPARX; Japan’s Scala and AIN Holdings co-invested; MyanCare offers MyanCare healthcare app and YinThway paediatric medical call centre service; WHO says Myanmar has one doctor for every 2K patients in urban areas, only one healthcare worker for every 5K patients in rural areas (This article is yet to be published).

Vietnam to commercialise 5G in October; It’s one of the few countries that can produce 5G equipment; The government will facilitate directing local businesses to invest in research and production of the equipment towards commercialising 5G products this year. More here

Singapore tops autonomous vehicles readiness index for the first time; The island state edged out the Netherlands which had ranked first in the past two editions of the index; The ranking reflects Singapore’s leadership in areas of consumer acceptance and policy as well as legislation pillars. More here

How fintech can help reach the unbanked and underbanked in SEA; The region’s 70% of the adult population is either unbanked or underbanked; Integrating blockchain in financial services can significantly enhance access to credit by using alternative sourcing data such as payment transactions. More here

Thailand’s NRF seeks to invest in 100 startups over 2-3 years; This will allow the food distribution major to learn about food innovation and tech; In 2019, NRF invested in 19 startups globally; This year, it has invested in another 12 startups, aiming for 40 by year-end. More here

Indonesia’s Bukalapak turns street sellers (warungs) into banking agents; Users will be able to deposit and withdraw cash at warungs, and conduct transactions such as transfers and payments; About 5M warungs move over US$70B worth goods a year, a quarter of Indonesia’s US$380B retail market; The Ant Group-backed e-tailer is valued at US$2.5B. More here

Thailand Post plans Smart Mailboxes using IoT; It will work with CAT Telecom to produce the mailboxes that can detect when parcels are deposited; By the end of 2021, they aim to install up to 22K smart mailboxes nationwide to cover the increasing needs of customers, especially those in e-commerce and logistics industries. More here

MDIF invests US$750K in Indonesia’s Arkadia; The company owns news portal Suara.com, sports portal Bolatimes.com, ads platform Iklandisini.com; The investment will enable Arkadia to further develop its regional content and networks. More here

A snapshot of the 3 startups graduated form VIISA’s batch 7; The three startups are Ask Locals (traveltech), Medigo (medtech), Gring (employee training); So far, VIISA has accelerated 32 startups over six batches; It is looking to launch batch 8 in August 2020. More here

How early investment in tech pays off when startups expand to other markets; Ohmyhome’s co-founder says investing early in tech allows you to see opportunities to fill gaps in the market; By automating administrative tasks as much as possible, employees will be freed up to do higher-value work.  More here

Korea sets up K-Startup Centre (KSC) in Singapore; It focuses on fintech and cybersecurity; The KSC is supported by ESG and will serve as a launchpad for Korean SMEs and startups to plug into Singapore’s and the region’s innovation ecosystem; ESG also has a partnership with Korea Institute of Startup and Entrepreneurship Development. More here

Japan’s IntegriCulture, Singapore’s Shiok Meats partner to ramp up cell-based seafood production; The two will develop inexpensive cultured serum for growing shrimp meat in the lab; Shiok Meats raised US$3M in a bridge round last month. More here

Mastercard, fintech startup tonik partner to create digital Neo Bank in Philippines; As a mobile-only bank, tonik will be able to develop a highly customised, scalable banking solution; It’s set to launch by Q3 of 2020, with a full range of banking services, including transactional savings account with a debit card, savings, term deposit accounts, consumer loans. More here

Sunway, Celcom, Huawei ink MOU to develop 5G in Sunway City in Malaysia; The collaboration will see the development of smart solutions in the areas of public safety and security, telehealth, e-learning, hospitality, leisure and retail experience using the latest telecom tech; It will also contribute towards achieving sustainable development. More here

Indosat launches digital operation with Ericsson, Huawei; The digital transformation will make the Indonesian telco’s back-end system more sophisticated; The telco reported 56.2M mobile consumers and registered a 7.9% yoy increase in revenue to US$454M in Q2. More here

Philippine government eyes support for e-commerce boom; The country has one of the slowest internet speeds in SEA; Reforms can be done by opening the telco sector through amendments in the foreign investment and public service laws. More here

Thai Tapioca Starch Association’s (TTSA) new president to promote local startups in global arena; It will build network with international startups and work closely together with government and business sectors; TTSA will also team up with Thai SME Association to help SMEs make a smooth transition from traditional business to digital business. More here

Singapore digibank contender picks Tencent’s cloud platform to provide digital banking to SMEs; The collaboration will have a focus on inclusive and green finance and aims to create a regional flagship digital bank; Asia Digital Banking Corporation is a Chinese consortium that includes Shanghai Jifu, JIC Technology Investment; More here

Line looks to influencer commerce in Thailand; The partnership aims to help brands increase their sales during the economic downturn while attracting influencers to the platform; Line recently launched Line Idol as a place where artists and online influencers can connect and engage with their fans by becoming chat friends via official accounts. More here

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At the beginning of this year, the labour market was strong. The Straits Times reported that over the past 10 years, local employment had grown steadily to 80.8 per cent with low unemployment at 3.1 per cent according to the Ministry of Manpower.

Real wages grew by 3.8 per cent over the last five years. If you were a business leader who foresees strong growth for your company, you would be mass hiring like Dyson who sought 2,000 new employees over four years.

As a forward-looking employer, you might have hired for stellar growth in your business. This is especially common if you are involved in promising technology sectors. Then you witnessed an unprecedented 80 per cent drop in revenue in three months.

Don’t worry. You are in good company. Even established companies such as Grab had to retrench five per cent of their workforce, followed by Airbnb with 25 per cent and Singapore’s 3,220 retrenchments in the first quarter of this year alone.

This scenario is more common than you think. If this reflects your situation, you must realise that there must be a better way to deal with all these upheavals. Even if your business is super resilient like Facebook or Microsoft, who can afford to hire more during this period of economic carnage, steps to increase the resilience of your workforce should be accepted by the organisation.

Also Read: In brief: Whole-plant based meat brand Karana raises US$1.7M

Accept the reality of retrenchment

One of the major drivers of employment pain lies in the false belief that economic cycles will last every 10 years. The reality is that while COVID-19 happened slightly over 10 years after the Global Financial crisis of 2008, companies had been forced to retrench due to a variety of factors such as technology disruption, competition, or poor management. There is a significant chance that you have to conduct a responsible retrenchment exercise for your company and cut working ties with cherished employees.

The table showed that despite the worst pandemic since the 1918 Spanish Flu, the first quarter retrenchment was the lowest over the past five years. 2015 was the famous year when Singapore added a net 100 new jobs over perceptions of peak workforce and 2016 saw record retrenchments for middle-aged and highly skilled workers.

Genting Singapore and RWS had to cut their manpower in 2016 over China’s economic slowdown and graft fighting campaign. Hence, this is not the first time where even large companies had to bow to changing macroeconomic conditions. This would not be the last time either. The reasons for retrenchment would be different for each period but volatility is clearly here to stay.

Hire millennials

Millennials grew up in an era where their parents experienced uncertain employment conditions in the 1980s, 1990s and 2000s. If you recall, the major events were the 1984 recession, 1997 Asian Financial Crisis, SARS of 2003, and the Global Financial Crisis of 2008. They have seen their parents join and leave jobs at least three times in their lives as job security eroded steadily over the past three decades.

Also Read: How SSIVIX LAB aims to make a difference in time of global health crisis with a one-stop healthcare app

The majority of millennials are working in full-time jobs now, but they are open to jobs with lesser security such as self-employment and freelancing. They will do it for the sake of more money, recognition, and good co-workers. For millennials, the definition of security lies not in the security of full-time work but in the skillset which they possess. In other words, they value career security over job security.

So, while they might be sad initially to receive your retrenchment letter, they bounce back faster than you imagine. They can always work for someone else or themselves in the meanwhile and you can hire them back when the company gets back on its feet. Ninety-three per cent embraced life-long learning and would probably be glad to take a master’s degree during the break.

Flexible working arrangements

Permalancing might not be familiar with you yet. It involves the combination of freelancers and permanent work assignment. Freelancers focus on doing piecemeal jobs which might not work if you have to continuously brief a person to a piece of recurring job. You would get the operational flexibility to increase and decrease your production capability with permalancers.

Permalancers would typically work with two to three companies at any one time. It would not be devastating for them to lose a client. You might have to pay more for permalancers than employees.

Clearly define work scopes for established positions would be necessary. Established positions are work areas where the work value is defined, requires specialised skills, and could be done in a reasonable set of time. Scope creep is a common blunder for companies, be it with employees or other forms of labour.

For instance, 3E Accounting has a clear work scope even for their interns. They have a structured and consistent process to deliver results. This type of structured process provides permalancers with the confidence to take on regular projects in the long run. Clearly, this would not apply for all companies as some work processes are inherently complex.

Stability in volatility

We live in interesting times. How we organise our ability to contribute to society, be it for monetary or other rewards, would determine our quality and way of life. It is not just about structural skills mismatch but also the arrangement for skills to be applied for goods and services to be created. That arrangement had to provide a level of stability in this volatile environment.

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Trade tensions between the US and China have been the talk of the town since the year 2018. With the two world powers undergoing a lengthy trade dispute, there are unending speculations on the impacts on both nations, and also the probable spillover effects on the Southeast Asian (SEA) countries.

Rumour has it that Vietnam is poised to be one of the biggest winners of all – let us dive a little into it.

According to the Foreign Investment Agency (FIA) of Vietnam, the total newly registered, adjusted and contributed capital of foreign investors have been stagnant since the trade war started, after experiencing a surge of 47 per cent in the year 2017. This is mainly due to the dive in capital inflows for existing projects over the past few years.

On the other hand, a spike can be observed from the year 2018 onwards when it comes to newly registered capital and capital contribution for share purchases – the number of new projects granted has increased by 18 and 27 per cent in years 2018 and 2019, respectively.

Apart from that, the FIA has disclosed that Manufacturing and Processing Industry is the top industry that the capital flows to, accounting for 65 per cent of total foreign direct investment (FDI) and recording a 48 per cent growth in the year 2019.

Also Read: Why is Vietnam going to emerge the strongest post-COVID-19?

This is not surprising since it reinforces the common belief that the US-China trade war is accelerating the pace of businesses relocating their operations elsewhere from China as a diversification strategy.

Vietnam is well known as a rising manufacturing hub in the region, particularly for these top sectors: (1) Electronics sector; and (2) Textile, Garment and Footwear sector.

To name an example of the relocation of operations, Luxshare-ICT, assembler of Apple’s AirPods wireless earphones in Vietnam, has gone on a hiring spree for thousands of new workers in June this year.

Another phenomenon that can be observed that supports the possibility of production moving away from China away to Vietnam is that Vietnam’s share of US apparel imports has benefitted as China’s share in the market is slipping – the country even surpassed China and ranked the top apparel supplier to the US in March and April this year.

Taking a glance at Vietnam’s position in the global value chain for both these sectors, the country primarily engages in mid-stream (lowest value-added) activities – being very dependent on imports of raw materials and only playing the role of manufacturing and assembling products for exports.

Vietnam is also highly reliant on foreign players, backed by the fact that FDI holds 80 per cent of the local market share of the Electronics sector, while 80 per cent of material supply for textile and garment production in the country comes from overseas.

Also Read: Is Vietnam the new golden child of tech startups in SEA?

Undeniably, Vietnam is emerging as an alternative favourite for businesses to set up their supplementary manufacturing facilities due to a number of reasons, mainly to take advantage of the affordable labour costs and free trade agreements (FTAs) that it has to offer.

The recently ratified EU-Vietnam Free Trade Agreement (EVFTA) and the EU-Vietnam Investment Protection Agreement (EVIPA) are the spotlights of all FTAs, helping Vietnam to harness the opportunities arising from the shift of supply chains.

However, the nature of the manufacturing industry in Vietnam poses a potential threat – if the country does not move up in the value chain, other countries in the region such as Thailand or Cambodia might also compete in terms of labour costs.

Despite the government’s efforts to spur investments into hi-tech manufacturing and infrastructure to align further with the global supply chain, only a few multinational companies (MNCs) have limited research and development (R&D) activities in Vietnam, namely Samsung, Renesas Design Vietnam, and the latest one being Qualcomm with its first R&D facility in SEA.

Apart from the above, other considerations include the size of labour pool, availability of skilled workers, capacity to absorb a sudden surge in production demand, and many more. Therefore, it is important for businesses to take a step back and rethink their relocation strategy – given that the country still has a long way to catch up with China’s pace, would it be ultimately more feasible to go for the ‘China-plus-one’ strategy instead?

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Before the dawn of the 21st century, the e-commerce space was largely dominated by American companies. US-based companies such as Amazon and eBay were leading the global e-commerce space and are amongst the most well-known e-commerce sites in the world.

However, in the last two decades, their leadership position appears to be challenged by their Asian counterparts.

In the early 2000s, Alibaba.com, a Chinese tech company under the leadership of Jack Ma revolutionised online cross-border business-to-business (B2B) transactions, allowing buyers across the world to easily discover and acquire affordable Chinese made products.

Soon, other business-to-consumer (B2C) focussed Chinese marketplaces such as JD.com, Tmall, Taobao, and Pinduoduo also started to emerge, this time enabling millions of consumers globally to browse and purchase affordably priced, quality products from furniture to consumer electronics.

As a result, eMarketer reported that in 2018, Taobao and Tmall, which are part of the Alibaba Group, were generating a total Gross Merchandise Value (GMV) of US$515 billion and US$432 million respectively. This number far exceeded Amazon’s GMV of US$344 billion.

Also Read: Why humanising e-commerce will be the game changer for DTC brands

In another example, Amazon Prime Day 2019, which is Amazon’s biggest annual shopping event, generated a whopping US$5.8 billion in sales. However, this was only a fraction of Alibaba’s Singles Day 2019 event for the same year, which generated a sales volume of US$38 billion, which was six times larger in comparison.

So how did Chinese e-commerce companies leapfrog other global giants to become the undisputed leader in e-commerce globally?

China’s massive consumer market

Unknown to most, Chinese e-commerce growth is largely locally driven as a result of the explosive growth of affluent and internet savvy Chinese consumers. In fact, the International Trade Administration estimated that China alone accounts for over 50 per cent of all global online transactions.

China has been a notable economic miracle this past half-century.  Since it started to open its economy to the world in 1978, its GDP has on average grew by 10 per cent per annum and lifted more than 850 million of its 1.4 billion population from poverty.

This has created an entire segment of nouveau rich middle class, with high disposable income and a vast appetite to acquire various luxuries from around the world. According to the World Economic Forum, the proportion of Chinese consumers making cross border e-commerce transactions had doubled from 34 per cent in 2015 to about 67 per cent in 2017.

Also Read: B2B e-commerce in Asia is increasingly successful. Here’s what we can learn from them

As China leads the way in e-commerce globally, it becomes important for both major consumer brands and technology companies around the world, eager to participate in this ever-growing tech-savvy Chinese market to be aware of some of the emerging online shopping trends.

Here are some key observations to prepare for:

The growing dominance of mobile payment and mobile shopping

Over the past decade, there has been widespread adoption of mobile payment methods and the prevalence of mobile shopping, to the point where it’s now the default mode of transaction across the country. In fact, according to JP Morgan, almost three out of every four e-commerce transactions in China are carried out on a mobile phone, generating over US$873 billion in sales annually.

In addition, the sheer monopolistic prevalence of mobile payments such as Alipay and WeChat pay has made the country almost entirely cashless. According to PwC, Mobile payment methods are so prevalent in China that they account for about 85 per cent of all online payments in China.

Furthermore, the rise of “super-apps” such as WeChat has integrated mobile shopping into the daily life of many Chinese residents. They provide users with an integrated, comprehensive suite of services from messaging, shopping, lifestyle, entertainment, and payment.

The rise of influencer online marketing

As a precaution against counterfeit products, which was unfortunately common in the past, Chinese consumers are heavily reliant on online reviews to guide their purchases.

As a result, consumers have grown to rely on digital influencers, live stream videos, and online articles to learn about the latest trends, popular products and to ascertain if they can trust a particular product or brand.

Online marketplaces such as Tmall and JD.com have thus invested heavily in enabling good product review capabilities and also driven a trend towards live steam online shopping events.

Also Read: DTC and native: Is it the perfect e-commerce partnership?

Furthermore, many of the live streaming sessions provide interesting content that engages consumers while steering them towards a purchase. In fact, live stream shopping events are so popular that in 2018, Alibaba’s Taobao Marketplace generated more than US$15.1 billion in gross merchandise volume (GMV) through live streaming sessions, an increase of almost 400 per cent year-on-year.

Emergence of the inverted O2O strategy

Traditionally, O2O (offline to online) refers to brick-and-mortar stores expanding their business sales channels to online spaces. However, in China, another form of O2O is emerging, which is from online to offline where Chinese online giants are starting to open physical stores, interacting with the same customers on both fronts.

This has completely redefined customer experience and has integrated technology and data in a far more pervasive way.

For example, in Herma Supermarkets (owned by Alibaba Group), customers can buy, dine, and order products straight from the shelf like a regular supermarket.

Also Read: Top 10 predictions for China cross-border e-commerce in 2019

However, shoppers can easily scan the products with their mobile phones to receive more information (e.g. pricing and product specifications) and pay for them directly through Alipay, a mobile payment method. Customers can also indicate on the spot collection or have the products delivered straight to their homes.

The omni-channel retail strategy has greatly increased convenience and improved shopping experiences for consumers, making it a popular retail strategy in China. McKinsey estimated that about 85 per cent of shoppers in China have engaged with both online and offline touchpoints during their purchase journey.

The longevity of Chinese marketplace dominance

China’s success over the e-commerce space is largely attributed to its massive domestic markets. In other global markets such as North America and Europe, Amazon still has a secure footing. However, China’s e-commerce companies are in no rush to invest heavily beyond its borders to claim world dominance.

There is still significant room for growth within China’s borders with the growing affluence of consumers and digital savviness in third and fourth-tier cities.

The next few decades belong to the Chinese, as they slowly expand their foothold overseas. Is China the emerging global e-commerce leader? I think that there is definitely clarity in that question.

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According to Fashion United, the Fashion industry was riding an enormous success in the past decade with the market value at a whopping US$406 billion.

However, the tables soon turned with the dawn of COVID-19, and the global retail scene soon became one of the industries reeling the hardest from its impact. Depending on the duration a store closes, McKinsey has revealed that 75 per cent of apparel and fashion companies could face challenges managing debt levels in the near future.

On the other hand, the global video game industry is thriving with the practice of social distancing becoming the “new norm”. Gaming now offers an engaging distraction for people at home craving for social interaction. Asian gaming giants Nintendo and Tencent both saw sales increases during the first quarter.

The former sold almost half of its games digitally, a record that helped increase profits by 41 per cent, while Tencent’s year-on-year online games revenue increased by 31 per cent. Analysis from GamesIndustry.biz also shows that sales across 50 key markets rose by 63 per cent.

When comparing fashion and gaming, they are at opposite ends of the spectrum.

Let’s take a deep dive into the commonalities of both sides and what the former can learn from the latter to tide through the pandemic and restore its former glory.

Also Read: What are the key trends in mobile gaming ads in Southeast Asia?

Embracing technology in products

We are in an era of digitalisation where consumers and businesses are brought to an online world at an accelerated pace due to COVID-19. With physical shops closing around the world, businesses are seeking to strengthen their online presence as a key to their survival through digital enablement.

Lesson 1: Companies should view state-of-the-art technology as an enabler for sales, revenue, and competitive advantage rather than a possible risk. Progress in digital transformation allows them to explore new business models or new revenue streams

At Europe’s largest games trade fair in Cologne, Gamescom, one can witness the ever-faster pace of innovation. The latest technological trends, hypes, and games are presented to appeal to consumers’ senses. Technological interfaces such as APIs or interconnected software systems are also a prerequisite for operational speed in product development, marketing and personalisation in real-time.

A personalised experience, highly interactive engagement and convenience in all shapes and forms have ingrained themselves as a critical part of consumers’ expectations in the gaming industry. In fact, these expectations have slowly spilt over to other industries, including the line of fashion.

Many large retail companies have made good progress in the digital transformation of their business models. However, it is not enough. Many businesses report that e-commerce sales are still flat compared to the same period last year. Even retailers with higher online penetration, such as direct-to-consumer speciality-apparel players, face challenges as consumers pull back on discretionary spending.

Companies that recognise the shift to retail digital transformation and take the initiative to further their digital strategies will be the ones that emerge stronger.

Also Read: Why brands fail on e-commerce and what they can do about it

Several notable cases are Lazada, Benefit Cosmetics, and Bazar adopting Augmented Reality (AR) and 3D technology to engage consumers with a personalised experience when shopping online.

Revisiting marketing strategies

The reality is that it is no longer enough to market the point of differentiation in one’s brand. While the quality of the product, as well as the ability to market the service, delivery, and overall convenience, is still crucial, marketing strategies have to be agile to adapt to changing circumstances. The Pandemic is a prominent illustration.

Same day delivery, curbside pick-up, and buy online or pick-up in-store have become table stakes and the competitive advantage derived from presenting these components becomes more important.

Lesson 2: Marketing strategies must create value for consumers and stakeholders. Organisations need to understand consumer’s changing behaviours to tweak their gameplay and ensure that these strategies capture value for themselves too.

The Gaming industry understands that ultra-high-end gaming is likely to remain popular but the emergence of services such as Arcade (Apple) and Game Pass (Microsoft) serve to disrupt the trend by providing gamers with a large library of video games without the need for advanced and expensive software.

Also Read: How this entrepreneur is stepping up the game for gaming tech e-commerce

In response, free-to-play models were developed, allowing developers to monetise without needed to convince consumers to make up-front purchases. Instead, they offer in-game upsell opportunities such as upgrades and expansion packs.

With evidence showing that cheaper entertainment tends to prosper during recessions, these low-cost, high-value offerings are a serious way for the gaming industry to expand.

The fashion industry consequently has to accelerate investments to enhance its marketing efforts. With the consumer shift online, businesses should consider enhancing their digital marketing strategies to build a stronger e-commerce presence but entice customers to visit physical stores when they reopen.

Exploring partnerships with online marketplace providers or wholesale partners is another alternative. One recent example is Walmart’s partnership with ThredUp. The former is offering some 750,000 pre-owned clothing through the resale site. The partnership is a win for both, as bringing in used apparel drives foot traffic to stores, and the established retailers provide ThredUp with new customers.

Similarly, the retailer has collaborated with Shopify. Walmart in recent years has evolved its strategy to stock more emerging and speciality brands on its shelves to match changing consumer tastes. The partnership with Shopify will broaden the visibility of smaller niche businesses to more than 120 million monthly visitors at Walmart.com, creating a better experience for merchants and consumers alike.

Overcoming challenges with compromises

COVID-19 has exposed the weaknesses of supply chains in businesses, with every industry experiencing negative supply shocks. How a business effectively moves away from supply chain bottleneck countries or companies will determine the speed and sustainability of their recovery.

Also Read: ZeusX to bring mobile gaming to the next level in 2020

Lesson 3: Companies should not depend on one external party when it comes to a crucial business process. Do not hesitate to make short-term compromises or be innovative to diversify the supply chain

For the wider gaming industry, the Pandemic has resulted in delays in the production of gaming hardware as factories around the world face supply chain interruptions. Pandemic-related delays have already been announced by game developers at Amazon, a Sony-owned studio and Square Enix. A loss of efficiency will also occur with more employees working remotely.

Nintendo has issued a warning that a situation of prolonged remote working will impact its processes, and the New York Times reports that developers as large as Sony, Amazon and Square Enix are facing difficulties. Some developers have found ways to adapt — albeit not without compromise. Gearbox Software, which makes the Borderlands series, has avoided delays on the deadline they had already committed to by deprioritising certain projects, some of which are unannounced.

Traditional retailers should thus rethink their smart supply network to match the new standards set by e-commerce and digital native players. Previous methods of reassessing inventory and segmenting stock in each category to assess the supply chain will not work any longer. New thinking and courage to step out of the old are required.

There is a shift in focus towards flexible supply chains over low-cost ones with fashion companies looking to onshore or nearshore. Deloitte has broken down four key digital retail trends that retailers can consider when tackling supply chain challenges: urban fulfilment, inventory strategy, flexible network and data, and technology adoption.

Preparing for a post-COVID era

The pandemic has brought to light the importance of forward-thinking. Leaders should look beyond epidemiology and sales data when reshaping their ecosystems to prepare for the future.

Instead, they should focus on becoming more customer-centric to avoid being crushed by unforeseen circumstances and competitors.

Also Read: Who’s driving e-sports and gaming in Southeast Asia: Gamers or fans?

Lesson 4: Never rest on your laurels. Constantly reflect on your consumers’ experience and build your roadmap from there.

While the boom time has been celebrated, gaming industry leaders are sober when assessing the future. They recognise the accelerated shift towards the delivery of games via mobile and cloud-based platforms, seeing the potential in this distribution model.

Google recently removed a US$130 sign-up fee for its cloud gaming service, Stadia, hoping that the value offered will convince consumers to stay for the long-term.  The rising tide of video games over the past couple months has also buoyed e-sports with licensed video games of Major League Baseball, NBA, NFL, FIFA, Formula 1 and NASCAR being aired variously on Fox, Fox Sports, NBC, ESPN and ESPN2 during prime slots. E-sports are subsequently seeking deeper investments from their sponsors so that their gains are sustainable.

We see BMW announcing a deal to sponsor four e-sports organisations in the US, the United Kingdom, Germany, South Korea, and China. Zenni, an eyewear company has also expanded its footprint by adding two new e-sports organisations in their current deal.

With permanent shifts in consumer shopping behaviour pushing more traffic and categories online, recent McKinsey research highlights that retailers could see broader adoption of e-commerce in previously under-penetrated categories (e.g. lingerie) and consumer segments (e.g. baby boomers).

The Fashion industry could leverage this opportunity to revise channel-mix targets and investment allocation to give a greater share to online channels, gaining growth momentum through these channels while protecting brand equity.

Also Read: Who’s driving e-sports and gaming in Southeast Asia: Gamers or fans?

As more consumers are emphasising quality over organic or all-natural ingredients, retailers can keep a close eye on this consumer base and determine what it means for their brand and strategies.

In conclusion, the biggest lesson out of the crisis is to focus on customers. Customers are the foundation of every business’s success. Understanding customers ensures that one’s products and services attain greater satisfaction for them, increasing the long-term goal of repeat business.

If companies do not constantly develop or innovate further to meet clients’ needs, they must be prepared to face high customer churn. For instance, PUBG has lost 50 per cent of its players within half a year. The reasons for this are a lack of focus on the players (customers), unfixed bugs in the game and poor public communication with the players.

With accelerated digitisation in our interdependent world today, businesses should thereby undertake the consumer-centric approach when charting their success to ensure business continuity.

Those who do not prioritise their customers’ journeys and experience will have serious reputational ramifications that threaten their survival, even more than the virus itself.

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Financial projections are an essential part of a startup’s pitch to investors. They are a feature from the initial pitch to the due diligence process as well as valuation discussions. When we look at an early stage startup’s financial projections, we are fully aware that they may not be highly accurate.

After all, there’s usually no historical track record to act as a guide. Furthermore, the business may still be undergoing further changes and pivots.

However, achieving accuracy is not the only aim of preparing financial projections. It is the thought process involved in coming up with projections that gives a better understanding of the startup.

This process benefits both the founder as well as the potential investor. Projections help answer the question of whether capital raising is required and the amount that needs to be raised. They also guide investors on whether the investment returns justify the entry valuation.

Revenue

A good starting point in looking at a startup’s projections would be the revenue forecasts. We typically begin by analysing user growth projections. To set the stage, we try to understand the size of the addressable market and find out the segment of the market to be served by the startup.

We then assess the user growth forecasts in light of this market size. We ask if the market penetration rates are in line with the market sizing and competitive landscape.

Also Read: Mulling over the future of investing with Paul Meyers and Jussi Salovaara

To understand more about user growth, we find out how the startup plans to secure customers. We look at what is known as the sales funnel which tracks the conversion of potential leads into customers. What is the proportion of visitors to the website that turns into potential leads? How many of these leads convert into eventual paying customers?

We also consider how long the sales gestation period is and the time it takes for a customer to make a buying decision. For instance, B2B businesses generally have a much longer sales gestation period than B2C businesses.

With this knowledge, we are able to assess if the user growth is achievable given the resources available to the startup. This can be external resources like sales channels relied on to reach customers eg alliance and JV partners, distributors, or online advertising.

In addition, we gauge if internal sales resources are sufficient to attract and convert the number of leads required to achieve the growth targets. Operationally, the company needs to show that it can handle increased users too. We examine how easy or difficult it is to scale up operations by making new hires, increasing back-office capacity, or having an overseas presence.

Timing plays a part in revenue projections. Unit sales volumes should reflect sales cycles and seasonality. In cases where the startup’s business depends on specific milestones eg first prototype, regulatory approval, or pilot production, the timing of revenue should be aligned to these milestones.

A startup’s growth depends as much on user engagement as it does on new user acquisition. It is not all about securing new customers but how existing ones behave. Delving into the revenue projections will reveal the user engagement levels that the startup is expecting. We look at the rate of users coming back repeatedly to the service, the average order value, and how long a user engages with the service before dropping off.

Also Read: Singapore’s personal finance app Fincy secures US$11M from parent GBCI Ventures

This is where metrics such as customer lifetime value and churn rates play a part in revenue projections. User engagement gives us an idea of stickiness, providing further evidence that the pain point exists and how close the startup is to achieve a product-market fit.

Another metric to look at is whether revenue per user is expected to increase or decrease over time. Different cohorts of users coming on board at different timing may have their own purchasing patterns. The product mix will affect revenue per user as well.

Apart from user growth, the selling price assumptions make up another side of revenue projections. We need to ask whether the prices are consistent with current as well as future competition.

Tied into pricing assumptions would be the revenue model adopted by the startup eg. SAAS, freemium, profit share, etc. This is a good opportunity to examine on paper, the viability and profitability of the current revenue model.

Costs

Aggressive growth comes with its requisite expenditure. That’s why it is important to see if the increase in Selling, General & Admin costs and R&D costs correspond to revenue growth. It will not be realistic if such costs are increasing at a drastically lower rate than that of revenue. We should also benchmark these costs against competitors’ margins.

Another relevant metric to look at is Customer Acquisition Costs or CAC, which tracks the expenditure required to secure new customers. We compare the CAC to the customer lifetime value to measure how cost-effective it is to acquire new customers. This provides an indication of how easy or difficult it is to scale the business.

Cash flow projections

After looking at things from the perspective of revenue and costs, we examine them from a cash flow point of view.

Also Read: How to impress with your startup pitch

In order to forecast operating cash flows, the company makes certain assumptions on its working capital levels. This offers a glimpse of the impact of receivables and payables on its cash flows.

Startups may forecast aggressive revenue growth but the effects of supplier and customer credit payment terms will be felt on its cash flows. This is where the timing of payments to suppliers and payments from customers becomes relevant.

Another important element in the cash flow forecasts is capital expenditure. The higher the revenue growth projected by the startup, the higher the capex and reinvestment needed to power such growth. Whether it is supported by cash flows from operations or external funding, the projections should indicate how such capex is to be funded.

The cash flow projections give us an idea of when the company will likely reach cash flow breakeven. We get to see how far the business is from being sustainable and whether a minimum volume needs to be achieved for that to happen.

Hitting the benchmarks

The projections will shed light on how much runway the company has before it runs out of cash. They provide clarity on the amount that needs to be raised in the current round of funding.

Projections should paint a picture of the startup hitting the next key milestones with or without funding. We can then see how this increases the value of the company. In the fundraising process, this allows investors to estimate the potential valuation at the exit of the investment.

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The buzzword for undergraduates today has been internships and the current situation we find ourselves in has increased its popularity exponentially. Given the poor job market today, even graduates are snatching at internships to tide themselves through these tough times.

This has led to an influx of higher quality interns and resulted in prospective interns today have a wider choice of industries to pick from than a year ago. In such gloomy times globally, it was an appreciated silver lining.

Before embarking on the search for my maiden internship, I was faced with the first key decision I had to make. Which industry to intern in? I was presented with a plethora of choices ranging from large corporate firms such as the Big Four to seed-stage startups that were just born months ago, at the height of the pandemic.

It was as diverse as the tech community’s opinion on which of iOS or Android is the superior smartphone operating system today. However, just like how some in the community above pledge their loyalty to either faction, I was immediately drawn to the tech startup ecosystem, for the below reasons.

Diversity

The startup ecosystem is a harsh and unrelenting environment. It is often said that it is the epitome of the phrase, survival of the fittest. Given the early stage of a business model that startups find themselves in with high cash burn and challenges to fund their growth and expansion plans, they must rely on lean operating structures that banked on those working for them to have high productivity levels.

Often in early stage startups, initial employees wore multiple hats and undertook different roles that were not necessarily related to one another. It was common to see founders hold the CEO, product, and marketing manager roles concurrently. These startups would have loved to make specific hires for those roles but they just did not have the financial ability to do so.

Also Read: Students, here are 3 reasons why you should never intern at a startup

Enter increased learning opportunities for interns. The flexibility in the job scope listed for interns meant they tended to learn more than their peers who chose their internships in the conventional corporate sectors. As Koh Kang Liang shared in his blog post, his three-month-long internship at ShopBack, back when it was still a 10-men team, saw him being tasked to oversee their hiring and networking portfolios, conduct market research and do up financial reports.

His initial job scope? Business development and analytics intern. While it represented a steep learning curve for him with multiple responsibilities, he remarked that he felt energised by them and saw his work translate into a real, concerted impact on the company. Looking back, he shared that while the internship was a challenging experience, it was a fulfilling one as he learned many skills along the way. Given ShopBack’s immense success today, I am sure Kang Liang would be doubly proud of his efforts early on to build it.

Culture

Entrepreneurs, though they look just like you and me from a physical viewpoint, are a different breed from the rest when it comes to their mindsets. They have high levels of determination, self-drive, and are not afraid of failure. They are doers. Consequently, they create teams that possess similar traits to them, and therefore, it is often said that startups consist of high energy, motivated teams that function at a fast pace in a productive and efficient manner.

The constant problem solving that was required to deal with the multitude of uncertainty, given its norm in the startup ecosystem, resulted in teams consisting of agile individuals that would not be afraid to shy away from problems but rather tackle them head-on to solve it. As we enter the Fourth Industrial Revolution, the importance of soft skills such as critical thinking and problem-solving cannot be understated. Thus, being exposed to them constantly in the startup ecosystem would go a long way to developing future-proof careers.

The hierarchical lines are significantly more blurred in a startup compared to conventional corporate firms and interns can utilise this to their advantage. Those who you need to report directly to are often instead referred to as mentors instead of bosses and you could easily meet your founders at the water cooler and bounce off ideas and wisdom from them.

Also Read: Rethinking the way we do student internships

Given the small teams that startups operate in, interns might have the opportunity to take part in meetings involving C-suite executives and observe on a deeper level how businesses and decision-making are executed at the top. These experiences, I reasoned, would not have been possible at a big corporate firm due to the sheer size and complexity of their corporate management structure.

The power of tech

While much has been said on the negative impacts of technology on our lives, we cannot escape from the fact that we have greatly benefitted from it and humans would have been far worse off without it. From the invention of the steam engine in the First Industrial Revolution to the birth of artificial intelligence (AI) in the Fourth, technology has made us more productive and is a key reason why we are able to achieve constant progress as a global population.

However, technology does not only make us smarter workers, it saves lives too. Take eko.ai for example. Utilising AI tools to detect often silent symptoms of heart diseases, the Singapore-based startup aims to reduce the cost and time for such detection tests and in the process, save lives.

Given that startups exist due to the presence of problems in our community, it is only natural that they enter the market with a viable solution that solves these issues and increase the convenience and quality of life for everyone. ible’s Airvida air purifier band certainly achieves that. In an effort to combat the seasonal haze in Southeast Asia and bring better living quality and protection to the community, their wearable air purifier utilises negative ions to draw harmful air particles away from the user and reduce the inhalation of smoke, pollen and allergens by up to 99 per cent.

Therefore, the power of tech and the positive impact it could have on other’s lives drew me to the industry and as Kang Liang shared earlier on in the article, the fulfilment of your work would be much higher if you could see the impact it had on others.

Also Read: Why you should never intern at a startup (especially e27)

Take your pick

Ultimately, the tech startup ecosystem is not for everyone. It is important to note when choosing which industry to pursue your internship in, you need to consider whether your personal traits are aligned to that of the ecosystem. Given that I desired being given multiple responsibilities and working in a fast-paced environment to challenge myself, I knew that the tech startup ecosystem would entice me and I hope that after digesting the above points I shared that played a part in my decision, you would gain better clarity and truly choose an internship you would benefit from.

As mentioned at the start, internships are the buzzwords for undergraduates for a reason. A strong foundation is necessary for a long and rewarding career and internships assist in laying the bricks for your desired career.

Therefore, pick wisely.

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Undeniably, COVID-19 send the world travel industry back to 10 years ago when travel startups are standing on the verge of collapse. Additionally, the frozen demand for travel and tourism has caused investors to scrupulously pour capital. Due to financial exhaustion, the majority of travel businesses have reconstructed to survive.

The period from 2013 to 2019 referred as the golden edge of the travel and hospitality sector when investors saw the dramatically potential boom of the industry.

While the risk investment in 2013 accounted for US$1.4 billion, that number rapidly claimed to a peak of US$30.3 billion, which is equivalent to the average growth rate of 48 per cent annually.

Additionally, the portion of travel and tourism in the investor’s portfolio had increased from two to 18 per cent in five years. Unfortunately, the trend had ended due to the outbreak of coronavirus.

An adverse adjustment in investment preferences

In the first half of 2020, the value of investment deals in travel startups significantly drop over 42 per cent that the number of deals also fall by 25 per cent. It was due to the expeditious decline of global demands. The new transaction has rarely occurred, while the current cancellation rate is on the rise.

Accordingly, several startups are running out of money, leading them to implement a prudent financial plan instead of burning money to expand the market share as six months ago.

Also Read: How travel tech startup Travelhorse survives the pandemic by branching into new territory

Undoubtedly, the airline sector and its investors are suffering the greatest loss recently. In June 2020, investors of Delta Airline had lost over 26 per cent of what they invested in this brand due to the sharp drop in the global stock market. Besides, there was a surge of business withdrawing from the market, while the number of new entrances constantly decrease in the Asian market. 

On the other hand, the adverse change in investors’ preferences also induces pressure in a fundraising round of several Asia startups. An online booking startup, Traveloka claimed that it was struggling with a new round of fundraising, which was over 17 per cent lower than the nearest one.

Definitely, Traveloka has never been the only victim. Even Airbnb encountered financial trouble recently. In which, around 90 per cent drop in its online travel booking platform cause this vacation rental business falling into US$2 billion debt, while some big investors refuse to add new money for it.

Prompt response

Many travel companies have decided to temporarily change the core business models, investing in other industries instead of pure travel business. Along with the advantage of broad customers’ groups and strong online distribution, those enterprises have a high incentive to enter the FMCG market. Besides, some startups expect the grow via the online food industry, which refers to be the least influential industry. 

KKday in 2019 was the emerging online tour booking platform with rapid growth in three consecutive years. Unfortunately, its revenues were estimated to drop off a lift by over 90 per cent due to the pandemic, as the cancelled orders continuously erode its financial condition.

As a result, KKday has started using this platform for selling souvenirs and food. The revenue of non-travel products saved KKday from bankruptcy, contributing approximately 50 per cent of total revenue.

Klook in Hong Kong has paused its tour booking services recently to provide on-demand food delivery. In which, Klook has added the new feature, allowing customers to make a reservation at restaurants, select meal kits, and delivery option in its platform. Instead of booking tours, Klook’s customers currently order meals and raw materials to be delivered to their home.   

Redistribute resources

According to an industry expert, the withdrawal of many investors is a non-permanent trend that will see the industry recovering at the end of 2020. Bloomberg predicts the Asia online travel market will increase by 129 per cent until 2025, reaching US$78 billion.

That’s why changing business models is still a temporary response to the current market condition. Startups should be ready for coming back to the travel industry at any time. 

In the midst of the investment drop, travel startups need to implement new strategies to spend their limited money more efficiently. While the demand freezes, it is time for investing in improving the business ecosystem. The common strategy tends to be personnel reductions. 

In particular, Airbnb reportedly cut over 25 per cent of its workers this May as an impact of the decrease in revenue in 2020, predictably accounted for around 50 per cent of 2019’s result. The majority of part-time positions have been laid off, while the whole business forced to reduce expenditure for avoidable activity. 

Instead of focusing on international visitors, the majority of startups in Southeast Asia recently drive its resource into the domestic market.

Also Read: Report: Indonesian startups took 70 per cent of travel tech funding in 2019

In Vietnam, the country with zero deaths from COVID-19, domestic travel has restarted as normal. Luxstay, the Vietnamese answer to Airbnb, has restored its booking services since the middle of May. In which, it is focusing a promotion plan to Vietnamese rather than foreign tourists. 

In Hong Kong, a travel business selling culture tour has successfully launched a brand-new virtual tour of some featured building to over 700 students. This campaign finally got sponsors from the authority and bring huge profits to the company, helping it came over the crisis.

Since the future of extending the movement restrictions is probable happened, the term of virtual travel expectedly become popular, and inspire several startups capturing this model to survive. 

Final words, notwithstanding implementing austerity strategy or changing the direction, travel startups have done a good job to defeat the severe impact of the pandemic. With the investment expected to return next year, the travel tech industry will come in a new chapter with prospects of glory.

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Many companies in the world are severely suffering from the novel coronavirus spread. Corporate income has slumped globally, particularly for brick and mortar businesses that require employees to go physically to the workplace.

But surprisingly, there are other companies that have grown during the new normal. What do you think is the reason for their success?

The most important factor in the financial performance of companies during the current circumstance is its ability to use digital technologies. The more digitised, the better.

That’s why there has been a sharp rise in online sales since the outbreak of the crisis. Social distancing orders, lockdowns, and stay-at-home campaigns have made people use online shopping more than ever.

So if your business has faced a financial loss amid the COVID-19 pandemic, you may have to increase your online presence.

Of course, the sooner a company starts using digital marketing, the chance of saving brand identity is higher. Social media platforms are at the heart of digital marketing, especially because of the shopping features.

Instagram, for instance, is one of the best networks you can use for online shopping. The majority of one billion active users on Instagram follow accounts related to businesses.

Also Read: A step-by-step guide in setting up instagram for your business

Many of them also use these accounts to choose their favourite products. This can solely show that this social network is a great platform for companies to sell their products online.

Even if you don’t have a business, Instagram is a perfect platform for you to make money online. For example, you can’t find a marketplace for influencers better than Instagram as they’re making loads of money per each post.

Influencer marketing on Instagram is the first priority of around 70 per cent of marketers for brand awareness and lead generation. Reduced rates of many influencers during the pandemic is also another factor that can help you increase your online sales.

It should be noted that a marketing strategy can significantly help you increase your sales on Instagram or any other platform. It’s good to consider the items below in defining a plan on Instagram:

• Search: how many niche brands are there?
• Goals: what do you want to gain?
• Customers: who do you want to reach out to?
• Content: what should you feed your audience with?
• Promotion: what can you do to promote your content?
• Engagement: how should you talk to your followers?
• Analysis: How well are you acting?

Obviously, you need more details to be able to outperform your rivals on Instagram. That’s why our team put several useful tips into an infographic to help you increase your sales on Instagram.

Also Read: 5 ways to monetise social media technology for startup success

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While we all watched the outbreak of COVID-19 impacting economies throughout the world and play havoc, the mobile app economy is another matter, as mobile app session times and installs saw dramatic increases and decreases varying across industries.

Businesses –small, medium, and large– need facts, data-driven insights, and real-life examples of how brands are adapting to this change in consumer behaviour. It is time for organisations to look at revamping customer engagement methods.

MoEngage and AppFollow partnered to create a holistic guide to highlight engagement strategies for industries irrespective of their growth trajectory for brands across several verticals that need to essentially bounce back to pre-crisis numbers, sustain or accelerate their growth.

The paradigm shift in spending pattern

Customers are prioritising essential buying even with lockdowns getting relaxed in most countries around the world, the ways consumers are engaging with and consuming products and services have undergone radical changes.

For example, there is an all-time high for emotional spending on services ranging from entertainment subscriptions to online workout and meditation subscriptions, growth in loan applications to get through uncertain economic conditions, online shopping for groceries is becoming the new normal, etc.

Also Read: 5 ways you can improve your focus on customer engagement

New consumption patterns and digitalisation have and will change the rules of the consumer consumption game further.

What’s your app adoption trend: Grow, slowdown, or stagnate?

To understand the App Economy better, industry experts and leaders from leading global brands have provided their insights on how businesses might fare with lockdown relaxation on rebuilding their strategies to drive growth.

To map the right engagement strategy for your business, answering a Path Assessment Checklist consisting of a few questions that will help brands measure their milestones and take the right strategy forward.

Below are the three engagement frameworks to grow in a post-crisis world:

• Growth sustaining (for verticals observing unprecedented growth during crisis, viz. entertainment). Plan ahead by providing actionable strategies to define engagement flows, revisit and rework value propositions, curate relevant content, streamline marketing communications and re-evaluate spend. The key here is to streamline your approach by identifying channels that generate the most ROI and continue scaling up.
• Bounce-back (for verticals observing unexpected growth viz. travel & hospitality). Once you clearly understand which track defines your brand, the first step is to know how you can retain users and intensify your customer journey from the ground up. As a brand, you have invested in paid acquisition channels earlier so use that data to pursue paid activities. Pick up paid channels that offered almost 50-100 per cent ROI.
• Growth accelerating (for verticals with neither surge in growth nor heavy decline viz. BFSI). Strike a Balance between paid acquisition and organic channels and allow limited access to premium features- once the user realises the value of the features, they’d be willing to purchase the paid subscription. This also eventually results in stronger community relations.

Expert insights

Businesses striving to navigate and turn around their operations rely upon marketing experts and leaders from various global brands for success stories and how to nurture and grow in a crisis like this.

Also Read: 29 startups that are pros of customer engagement! (Part 2)

Each of these strategies above is accompanied by examples of brands that have successfully managed to turn around operations in the right way and enjoy growth during the crisis. For instance, marketing leaders from Asus Vietnam, OYO, and Aviasales give their take on crisis management and growth.

It is imperative for businesses to understand the changed consumer behaviour and accordingly realign and restructure their strategies for the future.

A key focus area for any business while handling a crisis should be – engaging and retaining existing customers. Once you have engagement and retention strategies nailed down, you can proceed with user acquisition.

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