Omni-Channel is the New Retail Reality A CONNECTED WORLD Omni-Channel is the New Retail Reality by Hoseok Kim, Chief Executive Officer, 11street at the Asia Pacific Retailers Convention & Exhibition (APRCE) 2017

AGENDA Company Introduction The Current State of E-commerce A successful Omni Channel Strategy

The Implications of adopting E-commerce Part I Company Introduction The Current State of E-commerce A successful Omni Channel Strategy The Implications of adopting E-commerce

Company Introduction 11ST.CO.KR Launched in 208 No.1 Open Marketplace No. 1 in Mobile / Traffic / Brand Value N11.COM Launched in 2013 No.1 Open Marketplace JV with Dogus Group Korea Turkey Malaysia Thailand 11STREET.CO.TH Launched in February 2017 Open Marketplace 11STREET.MY Launched in 2015 No. 2 Online Marketplace JV with Axiata

The Implications of adopting E-commerce Part II Company Introduction The Current State of E-commerce A successful Omni Channel Strategy The Implications of adopting E-commerce

Home to the largest retail market worldwide E-commerce Penetration Ecommerce in Asia Pacific Home to the largest retail market worldwide E-commerce Penetration * According to the share of population South Korea Japan Taiwan Singapore Australia Hong Kong Malaysia Thailand China Indonesia Vietnam Philippines India 72% 52% 28% USD 9.3T by the end of 2017 with 7.7% of CAGR E-commerce will account for 14.7% of total retail sales in APAC by 2017 and will climb to 25.4% by 2021 on average*. * Source ¹ https://www.statista.com/statistics/412302/ecommerce-penetration-asia-pacific-countries/

OFFLINE ONLINE Offline vs. Online Product More mass or short-tail products based Price Higher compared to Online due to cost structure Promotion Mass/Segment marketing More ATL/BTL focused Product Relatively more long-tail products Price Lower Promotion Personal offering Integrated marketing focused

Matters for Online Consumers Price / Discount Convenience / Experience Onsite shopping journey Delivery/Exchange/Return CS Product Variety

A successful Omni Channel Strategy Part III A successful Omni Channel Strategy

Suggestion for Omni Channel Strategy LONG TERM SHORT TERM PRODUCT Develop online specific products (ex: Anker, Gucci online only) Start selling existing products online in order to accumulate right knowledge and experience to develop products for online PRICE Bundling – To create more value at the similar price Different packaging Develop pricing which considers the change of cost structure

Suggestion for Omni Channel Strategy, Cont’d LONG TERM SHORT TERM PLACE Secure online channels (including its own) which fit to brand characteristics Adjust channel strategy (offline vs. online) along with the evolvement of online retail market Leverage online market place rather than building its own channel in the beginning PROMOTION Secure personal marketing capability Digital marketing Marketing automation Secure Integrated marketing capability Leverage online marketplace capability to promote products online Assign appropriate budget for online promotion

Case Studies Built an Established EC Presence in Less Than 6 Months Impactful promotion Efficient marketing plan Data driven insights for strategic planning Differentiated the Brand with Distinct Value Propositions Online specific product line Exclusive online promotion Value-based offer

A CONNECTED WORLD Thank you