Lazada to fold RedMart into its platform, signals entry into online supermarket business

File photos of Lazada and RedMart logos.

SINGAPORE: E-commerce company Lazada on Thursday (Jan 31) announced it will make its foray into the online supermarket business in Southeast Asia starting with Singapore, with the integration of RedMart into its platform.

RedMart, which Lazada acquired for an undisclosed sum in November 2016, will move over to the e-commerce platform from Mar 15 this year. Lazada said this will allow shoppers to buy groceries and fresh produce along with the other products already on its site in a single location.

Orders on the new RedMart on Lazada will continue to be fulfilled by the online grocer in customers’ chosen delivery slots between 7am and 10pm, while orders with other Lazada sellers will be fulfilled separately, the press release said.

Existing RedMart customers can continue shopping on the existing app and website until 11.59pm on Mar 14, before the migration kicks in. They will have to download the Lazada app to continue using the service after that.

Mr James Chang, CEO of Lazada Singapore, said at the press briefing that the company will start informing RedMart users from Feb 1 of the impending shift.

He added that the features RedMart users are familiar with, such as purchase history and two-hour delivery windows, will continue to be available after the migration.

The minimum order to get free delivery will continue to exist, but other Lazada purchases will not contribute to the required amount at checkout, the executive said.

Members of LiveUp, a membership programme that offers savings, rewards and lifestyle services from various companies, currently have to hit S$40 for free delivery, while non-members have to reach S$100, according to RedMart's website.

Lazada's move into the online supermarket business comes as consumers are increasingly buying their groceries online, the company said.

It said the e-groceries market in Southeast Asia is expected to be worth US$309 billion by 2021, of which Singapore will contribute US$7 billion and Indonesia will be the biggest market with US$120 billion.

It added that it is looking to launch its grocery and supermarket business in at least one other city from the second half of this year.

RedMart co-founder Roger Egan will spearhead Lazada’s push into the supermarket business in Southeast Asia.

Asked if the company will build the business from scratch in this new market or acquire another company and integrate, as it did with RedMart, Mr Egan said he is looking at all opportunities.

"Whether we will do it ourselves or partner others, we're open," he said during the press briefing.