East Malaysians embracing e-commerce

PETALING JAYA: Six out of 10 East Malaysians are booking their Malaysia Airlines tickets online, said Amin Khan, senior general manager of commercial strategy for MAS.

This is a sign that more in the country are using e-commerce facilities, which should encourage more businesses here to embrace the technology.

In comparison, Amin said, only one in four MAS customers in other parts of the world book their ticket online.

“In East Malaysia, the guy with the credit card and PC becomes an ‘electronic ticketing agent.’ People find it more convenient to go to that guy up their street, than to the city centre to a ticketing office,” he said.

“They hand him the cash (for the ticket) and he makes the online booking.”

According to Amin, while high-speed broadband is the ideal catalyst to spark off e-commerce adoption, the nation’s basic Internet infrastructure can still be taken advantage off and be a convenience to most people.

MAS is embracing e-commerce in a big way. Two years ago, only 3% of its tickets sales were booked online; today it is 25%, thanks to MAS’ iPad bookings and mobile booking applications.

“e-Commerce has opened up a new market for us. Online tickets sales do not cannibalise our regular ticket sales. With our online process, we also get more visibility.

“A customer can visit our site everyday until he gets a good price. This beats calling up many travel agents for quotes everyday,” Amin said.

The national airline spent roughly RM400mil to set up its Passenger Service System, which includes an e-commerce component, two years ago.

Amin declined to quantify the airline’s return on investment for that initiative but said it enjoys a cost savings of RM3 per ticket sold online, which can be passed on to its customers.

He was presenting a paper — Case studies: Lessons for e-commerce ventures — at the Business Success Forum.


Earlier, Shaifubahrim Saleh, president of the Association of the Computer and Multimedia Industry of Malaysia (Pikom), said many small and medium enterprises (SMEs) are still ignorant about e-commerce.

He said these SMEs still believe they have to buy servers and set up an IT department to participate in e-commerce, when in actual fact they can merely subscribe to e-commerce services for as low as RM100 per month.

According to Pikom, 31% of SMEs surveyed in the country believe they do not have the technical knowledge to embrace e-commerce, while 17% said they are not ready to engage in e-commerce.

“That’s why Pikom is going to 16 locations nationwide to teach SMEs there about e-commerce and the ease of adopting e-commerce services,” Shaifubahrim said.

“They need to understand that in the age of cloud computing, they do not need to possess in-depth technical knowledge to get into e-commerce.”

According to Pikom, its roadshows will have educated about 3,000 SMEs by year end. It estimates that there are some 900,000 SMEs in the country.

“It is going to be a long process educating all the SMEs,” said Shaifubahrim.

Pikom said the value of e-commerce in Malaysia will be RM92.6bil by year end — a 32% increase from last year. “Yes, there is vast potential in e-commerce here,” Shaifubahrim told In.Tech at the Business Success Forum.

The forum is one of the main initiatives under the National ICT Month (NIM) 2010. The month-long event ends Aug 12. It features talks, forums, workshops and seminars.

NIM 2010 is organised by Pikom and the Science, Innovation and Technology Ministry.

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