BusinessToday sat down with Eric Cheng, CARSOME Co-founder and Group Chief Executive Officer, to talk about the inspiration behind CARSOME, and how the pandemic affected his organisation.
- What is the story behind CARSOME?
CARSOME started in 2015 when JT (CARSOME Co-founder and CARSOME Academy Chief Executive Officer Teoh Jiun Ee) and I realized that it was challenging to buy and sell pre-owned cars in Malaysia. We knew then the process had to be standardized, digitalized, and have a customer-first approach.
CARSOME was later founded to address these pain points and with the mission to transform and reinvent the car transaction and ownership experience in the region by bringing trust, transparency, and choice, to customers and dealers. Powered by data and technology, we have grown to become Southeast Asia’s largest integrated car e-commerce platform today with presence in Malaysia, Indonesia, Thailand and Singapore.
- What challenges did you face and how did you overcome them?
It’s never an easy path to reinvent a long-established ecosystem, especially when we just started as a digital platform seven years ago when the industry lacked transparency and was marred with distrust. We face many challenges in building the company and in our journey to bring consumers the trusted way of buying and selling cars.
But throughout this journey, we’ve constantly been improving our capabilities to provide our customers peace of mind throughout the car ownership experience. For example, our extensive selection of pre-owned cars from CARSOME Certified have to pass through a stringent 175-point inspection check to ensure safety, comfort, and aesthetics. In addition, we were the first in the market to offer fixed prices with no hidden fees, five-day money-back guarantee and one-year extended warranty for pre-owned cars. These factors are making pre-owned cars to be even more appealing than before.
To continue driving our mission to innovate the used car ecosystem, we teamed up with various strategic partners from the finance, insurance, content, and other industries to strengthen our data/tech capabilities to continue solving customers’ pain points.
Thanks to all these efforts, we’ve built a household, trusted, and liked brand in the region through more than 250,000 transactions and 14 million customers served throughout our platform.
- How were you affected during the pandemic?
The COVID-19 pandemic spares no industry from its wake – it affected the overall economic growth and consumers’ spending. However, many consumers have turned to private vehicle ownership during the pandemic to avoid close contact and for hygiene purposes.
The operations of chip manufacturers were likewise affected due to the pandemic resulting in the global chip shortage until today. This eventually crippled the supply to carmakers and resulted in a growing backlog of orders for new cars. With longer waiting periods for new cars and used cars being a more financially viable option considering the depreciation costs that typically come with new cars, we observed a surge in demand for used cars and believe this demand trend will continue in the coming months.
- What are your plans moving forward?
We will continue to work towards our mission – which is to provide customers with peace of mind throughout their car ownership experience – although we are still at the beginning of realizing it. There are many more exciting opportunities ahead that we want to capture and transform into a better solution, product, and service for our customers. The opportunities we identified are within these segments:
- Strategic alliance – We are continuously exploring potential partnerships from various industries to strengthen our offerings and build the largest proprietary transaction dataset in the region, in order to develop a deeper understanding of current and future car pricing, user behavior, and their transaction journeys.
In addition, we are part of the consortium led by KAF Investment Bank to be one of the five successful businesses to receive the digital banking license in Malaysia. We’re honored to be part of this exciting venture and will continue to explore opportunities within the consortium to drive financial inclusion and democratize financial access in Malaysia, by leveraging our technology, data and network.
- Market expansion – We will continue to expand our market presence in the region by establishing more inspection, experience centers, and CARSOME Certified Labs, Southeast Asia’s largest state-of-the-art refurbishment facility. Currently, we have grown to over 120 consumer-facing inspection and experience centers across four countries and one CARSOME Certified Lab in Malaysia.
- Talent development – Following the recent expansion of our Malaysia-based regional headquarters, we aim to make Malaysia our central talent hub in the region. We are also doubling down our investment in broadening and upskilling our local workforce with different specializations to better solve customers’ pain points and support the used car ecosystem.