Opening a store on Lazada to drive sales is a great option for companies, that look to expand into Southeast Asian markets.
One of the benefits of selling cross-border on Lazada is unbeatable. It’s because you instantly reach six countries (Singapore, Philippines, Indonesia, Vietnam, Malaysia, Thailand), with a total population of hundreds of millions. The benefit can be either of your water testing approaches to see the sale performance from your product category. Or you can strategically enter the markets and reach target customers with no upfront fees and lower transaction fees.
Except for your product and supply chain strategy, Lazada’s seller promotion and marketing strategy are essential to reach customers and drive sales. Thus, based on my client-serving and business experiences, I’ll share with you 1 thing not to do and 7 things to do in Lazada seller promotion.
By the end of the article, you can learn what promotion tools you can use. You can also understand why driving traffic to seller stores by using an external paid advertising platform is not recommended.
- Sponsored Search Ads
- The Sponsored Product Ads
- Sponsored Display Ads
- Affiliate Program
- Flexi Combo
- Bundle Deals
- Seller Voucher
- Free Shipping Promo
- Seller Picks
- Store Decorator
- 3 Reasons you should not leverage Google and Facebook ads driving traffic to Lazada seller store
1. Lazada Marketing – Sponsored Search Ads
About 30 million searches are made by shoppers on Lazada every day and about 50 percent of sales go through the search bar. Sponsored Search gives brands and sellers the opportunity to boost their product’s visibility. Also, it gives advertisers to reach customers who are actively considering buying or are ready to buy on the search results page. What’s more, it’s a Cost-Per-Click model. So normally ROI of sponsored search ads is the best.
You can find that Sponsored Search is on your Seller Center dashboard. After logging in, you can click Sponsored Solutions. Right under that, you can choose Sponsored Search. Creating a sponsored search ads campaign is not difficult, I’m not going to go into details regarding strategies and how to run. But you could refer to the 3 steps listed below and drive sales in as low a cost per acquisition as possible
1) Select the proper products:
- Test the new product market reaction,
- Drive more sales from your store trending products,
- promote countdown deals or bundle deals that include those SKU item inventories that rest a lot in stock
2) Research the keyword volume and select the proper keywords
- Type in a root keyword and select all keywords that are having high relevance with your product, in particular, that product generic, functional, seasonal keywords have huge amounts of traffic.
- Don’t ignore long-tail keywords related to your product.
- Refer to the keyword bidding price for a decent rank position, as you don’t want to bid a keyword with avg. US$0.5 CPC for 50 clicks to convert into a sale when your product retail price is US$50 with a 20% profit margin
3) Optimize your Lazada search ads
Change the keyword bid prices, add negative keywords, and break down the campaign into high performing products, new products, trending products, and high inventory in stock
2. Lazada Marketing – Sponsored Product Ads
As being similar to other marketplace platforms (Amazon, Tmall, etc), it has PPC advertising for sellers to reach customers and boost sales. It’s called Lazada sponsored product ads.
Sponsored product ads are product-driven, which means you are not able to select specific keywords for the promoted products (At most 5 products in a campaign). Lazada can help you detect the most relevant traffic and show your sponsored product ads.
If you are running sponsored product ads, such as on Amazon, Tmall, or Rakuten, it means that you can place your products in more visible areas on the website. But the difference in Lazada is that it only shows on the right-hand side of the product page at the moment. I believe it can roll out to appear in more placements.
Being said that, sponsored product ads become the must-have ads campaign in your strategy. It’s because it doesn’t have a huge impression amount. But it charges by CPC and you could show it on your competitor product page, and give the target customers one more choice.
3. Lazada Sponsored Display Ads
Display ads, which are the same as other marketplace’s ads approach. You can use it to reach more potential customers and retarget prospects in a banner, rich media format. The ads charges brands by the CPM model and helps sellers increase product visibility on Lazada’s premium online assets. It includes homepage banners, app pushes, electronic direct mail, and more.
4. Lazada Affiliate Program
The affiliate program is not a strange term in the eCommerce marketing world. Being the same as other affiliate strategies, the Lazada affiliate program is a program where a publisher works with it to promote and sell the products on a commission-based payment model. The affiliate promotes products or services using a unique link to send traffic to the Lazada website. If any user through the link purchases the product, the publisher can get the commission based on the program commission scheme.
This new feature allows brands and sellers to tap Lazada’s pool of over 3,000 affiliate partners and their vast networks to drive traffic to their product pages. The Cost-Per-Sale model guarantees that brands only pay when a sale is made. It is making it an efficient marketing investment.
5. Lazada Flexi Combo
Flexi combo bundle is another promotional tool in Lazada that you can use to encourage buyers to purchase more items that are similar to the initial item they have their eyes on. Basically, it’s a bundle deal strategy, but it has limited time or limited orders for sellers to create urgency and call customers to check out right now.
For example, you’ll be choosing security camera collections that are most popular in your online shop. If it’s a Ring spotlight camera, then you create a bundle with an Amazon Echo Show. Some customers love to buy bundle deals, and it saves dollars to upgrade the smart home system. So you can create a Flexi combo with an eye-catching discount at a limited time and a limited order offer.
6. Lazada Bundles
Sellers can combine different SKUs into one item with bundling discounts by using bundles. Basically, there are 4 types of bundles Lazada allows sellers to use
- Quantity: Buy 3 packs of Ring solar panels, and get 40% off for each item.
- Buy 1 Get 1 Free: Buy 1 box of N95 masks, get one box free
- Combo: Buy a Ring stick up camera battery with 15% off, get one of the ring stick up camera solar panels, camera case, or camera mount with a 10% off discount
- Free Gift: Buy a Ring spotlight camera battery, get a free camera case
A bundle deal is one of the essential product marketing strategies to increase sales and AOV. It’s because it is combining different items and creating variations to meet customer demand. As you can see from the screencap here, its new market value with competitive pricing that compares with opponents can more easily convert customers into sales. If the new bundle profit margin is within your target margin number, this strategy might scale up your store selling very fast.
In Lazada, all sellers except Redmart (retail) are eligible to create bundle deal promotions. All product categories are eligible to create bundle deals. As long as the products are complying with the product and listing policies, except for nonphysical products, e.g. digital products.
Just keep in mind that the Lazada bundle promotion can’t work with the Flexi combo promotion at the same time. If an SKU is being used on both Flexi combo and bundles, only Flexi combo promotion takes effect.
7. Lazada Seller Voucher
A voucher is a promotion tool that product discounts can be applied to the products. So basically it’s a kind of coupon for Lazada sellers to increase conversion rate.
In Lazada, there are 2 types of vouchers, which are seller vouchers and Lazada vouchers.
From the naming you might understand, it offers the Lazada voucher itself. On the other hand, sellers can create seller vouchers based on which products the sellers aim to apply to. The vouchers can be stored in the customer’s wallet, so the customer can enjoy the discount automatically when she or he is checking out.
The great thing about vouchers is that it benefits sellers and buyers both ways. As you may have already noticed, Lazada plasters vouchers are almost everywhere. You can find it on the website and they sometimes push the use of vouchers through email marketing. In the end, the sellers and buyers win at both ends. The buyer is able to save money whereas the seller gets to drive more sales to his products.
8. Lazada Free Shipping Promotion
Free shipping promotion tools enable sellers to create a campaign. It attracts customers to convert and absorbs the shipping cost by the seller herself or himself. Basically, the seller can type in a budget she or he can absorb, and create the promotion period. The period of promotion can vary by condition (Purchase a fixed amount or above, etc), target market, and delivery option.
Shipping is a wonderful promotional element for almost every E-commerce store. It encourages customers to buy more than just a select number of products.
The regular scenario is that the customer would have to pay a certain for the shipping of his purchased products. Most of the time, a customer decides to buy just one or two items.
Of course, one of the goals of Lazada is to increase sales for all the sellers using its platform. With that, free shipping promotions serve as a tool to entice more sales.
9. Lazada Seller Picks
Seller Picks is a free feature that empowers eligible sellers to improve visibility for their products and boost product sales from search page results on both the Lazada website and mobile app. So as you increase your performance as a Lazada seller, you will have more opportunities to provide more visibility to your brand.
Of course, this feature is not available for all sellers. Your eligibility would depend on selling performance. For example,
- A Store’s good rating needs to be greater than 70%
- The seller has more than 3 SKUs listed on the store
- A seller can maintain a customer service response rate that is greater than 85%
- Leverage seller voucher, store decorator, bundles, and Flexi combo on the business to drive traffic and boost sales.
If you meet the criteria, you will receive a message or notification from Lazada. Once you make the cut, you have to apply the product quotas yon the seller picks program. When you do, you will be able to choose products that you can add to the Seller Picks promotion of Lazada.
10. Lazada Store Decorator
It was mentioned in the previous video that for you to be eligible for the Seller Picks campaign, you need to have used the Store Decoration feature on your online store.
This is basically just a customization tool that sellers can use to make their business page more visually attractive. As you all know, as a seller, you need to not just sell products but also your brand.
In the store decorator section, you can select the store page theme. It is quite similar to the Shopify theme template, but here it is much simpler to select and adapt. And you can select and add the product categories you’re selling on the home page. And then you can choose the banners and video materials to decorate the pages. It is very similar to building up a website by using WordPress or Shopify.
3 Reasons that sellers shouldn’t leverage Google and Facebook ads driving traffic to Lazada seller store
From a financial perspective, it’s not cost-efficient
I assume you’re using Shopify to create a web eCommerce store. In terms of transaction fees, Shopify only charges sellers payment processing fees, which is 3.1% + 0.29 cents. However, Lazada charges sellers each transaction at least 3% – 6% fees. It is referral plus transaction processing fees. Unless you only need to pay 3% thanks to your product category in Lazada, otherwise it reduces the profit margin per transaction.
Lose customer data asset
Be the same with other marketplace platforms, sellers are not able to collect and accumulate customer data from transactions. Platforms are hosting and managing the customer data. It implies you might have to pay fees to implement email communication and retargeting in the future.
So from the customer lifetime value perspective, driving sales from Google, or Facebook ads might cause you to lose these opportunities. It’s because you might have to reply on repurchase to earn back the CAC. And the new purchase might be break-even, or not profitable.
Less control over your brand and product
As you can see, giant eCommerce platforms tend to squeeze sellers more fees, like Amazon. Also, they set up more strict policies on product listing and selling (product items out of stock, customer satisfaction metrics, etc). In the end, you would lose control of your online store, and it disables the flexibility and product selling in Lazada.
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