Online shopping platform Multiply has made a sudden announcement this Friday, April 26, that it will be closing its marketplace—touted as Southeast Asia’s largest virtual shopping destination with over 130,000 stores—on May 6, and shutting down all business operations by May 31.
In an official press statement from Multiply headquarters in Jakarta, Indonesia, Multiply CEO Stefan Magdalinski mentions the “disappointing outcome” of the company’s reinvention to a commercial marketplace, from a social networking site, as a factor in the shutdown.
“About a year ago, our local Multiply teams were given the mighty challenge of totally re-inventing the company. After much effort, we are forced to admit that we were not able to pull it off,” says Magdalinski, who nevertheless thanks his team for their work, despite the outcome.
Site operations will continue as normal until May 6, at which point the marketplace will close, and will wind down operations the rest of the month to minimize disruption to merchants’ businesses, the statement emphasizes.
Multiply assures that it will provide its merchants “time to find and migrate to alternative e-commerce platforms and settle all payments on items bought and delivered.”
In both the official statement and the public notice onsite, Multiply indicates that they “will use the rest of May to make sure that all accounts are settled and that our merchants receive full payment for all the transactions they completed.”
Sought for comment post-announcement, Kim Frances Yao Lato, owner of gadget website Kimstore and one of Multiply’s bestselling merchants, begs off from commenting on the news to Entrepreneur, “in respect to Multiply.”
The company itself apologizes on its website for the “sudden news,” and also thanks their users “for their loyal support.”
For his part, Jack Madrid, country manager of Multiply Philippines, takes his cue from Magdalinski, and maintains via SMS message that he is “busy taking care of merchants and employees.”
“I am proud of what the Multiply PH Team has achieved the past two years,” says Madrid in his SMS message to Entrepreneur Philippines. “We will work hard to ensure smooth transition for our merchants and buyers.”
Multiply International, meanwhile, notes in its statement that shareholder MIH Limited “remains very optimistic about ecommerce in Indonesia and the Philippines and has recently increased its investment into its successful general classifieds businesses there -- namely Tokobagus.com (Indonesia) and Sulit.com.ph (Philippines) who are #1 in each of their respective markets." Sulit.com.ph co-founder and managing director RJ David admits that he has only learned of the imminent closure of Multiply, and is “trying to know the details.”
Nevertheless, Mr. David continues to remain positive about the online classifieds business.
“Sulit, together with MIH, are both optimistic of the classifieds business in the country. The recent news about Multiply does not affect our plans,” says David, also via SMS.
He cites that as of March 2013, unique visitors have risen 37 percent to 13.7 million from 10 million in 2012. Total ad placements also increased by 83 percent to 9.5 million from 5.2 million in the same period last year.
Last September 2010, MIH Limited, under Naspers, acquired a 74 percent holding in Multiply Inc. In August 2012, Multiply announced that it would close down its social networking services by December, as they would be focusing primarily on e-commerce. Full cessation of social networking features occurred March 2013.
In the Philippines, Multiply had been promoting its revamped site by calling attention to its successful merchants, often via awards such as the “Multiply Origination Awards” featuring unique products sold onsite.