HK's eCommerce platform HOME+ to cease operation in March

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Hong Kong’s eCommerce platform HOME+ will cease operation from March this year as the company is changing its business direction.

According to HOME+’s website, the eCommerce platform states that it will stop operation and all services from 3 March. The platform will also stop receiving orders from customers from 18 January. Members of Home+ that are requesting for refunds could register by filling in specific forms.

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A check by MARKETING-INTERACTIVE saw HOME+ said in an internal notice that it will stop accepting electronic coupons from 10 January. Its website also announced discounts of as much as 75% on a variety of products in the electronics, food and drinks categories.

It will also end all memberships and accounts of HOME+ from 3 March, it will also stop accepting new members from 10 January, and invalidating all membership points from 18 January. HOME+ will arrange refunds for members' leftover points.

On the marketing front, Wilson Wong, marketing director at Price.com.hk told MARKETING-INTERACTIVE that given the recent pessimistic retail situation, it is expected that some players may choose to leave the battlefield or become more practical to find a better way to grow the business model.

"I think eCommerce is definitely a high-growing industry in recent years. Many big and small players enter the local marketplace and logistic market, and some launch very attractive promotion offers to win customers, such as free delivery and crazy flash-sales prices. High promotion budget might be a good tactic to draw short-term awareness and transactions, but whether the business model could be sustained in long run is always a big business challenge," he added.

On the other hand, Samson Fong, head of marketing, Zenyum said the exit of HOME+ from the market is sad news. "This means there is one less eCommerce retail channel option for us. The initial model of HOME+ was terrific. It aimed at utilising the company’s most valuable property - direct access to millions of telecom customers - for upselling, re-marketing or cross-brand affiliates. It’d have been another HKTV or even Amazon should it have been given enough time to enrich its brand inventories or strengthen its fleet and ways of fulfilment," he added.

COVID-exit might have shortened the business runway of HOME+ or any other early-stage grocery eCommerce platforms, according to Fong. "The fatal root cause that put an end to the business is likely the absence of brand-owned unique inventories, delivery fleets or fulfilment checkpoints. Without either of such infrastructures and hence having to rely on third-parties suppliers, the thin business margin of an eCommerce platform would have been cut even thinner," he said.

HOME+ is not the first platform to undergo business restructuring. Back in September last year, TVB’s subsidiary eCommerce platform big big shop has cut some employees due to upgrading, transformation and reallocation of resources of the company. TVB stated that as the eCommerce business in Hong Kong is growing, the company’s eCommerce business group has entered the stage of upgrading, transformation and resource integration to maximise the business benefits of the company.

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