How Proto Can Transform the Philippine E-commerce Landscape
The e-commerce market in my country the Philippines is growing at an unprecedented rate, with mobile connectivity and internet use at an all-time high. According to the International Trade Administration (ITA), the market reached ~$17 billion, driven by over 73.91 million internet users, many of whom spend 10+ hours online daily.
But, the logistics infrastructure has struggled to keep pace, particularly when dealing with the ~44 million unbanked and the preference for Cash on Delivery (COD) (67%). E-commerce continues to account for ~0.5% of GDP, or ~$2.4 billion as per the Department of Trade and Industry (DTI).
Consider a scenario where a customer in Quezon City (or other cities) orders a smartphone from an online retailer. The order is placed with the expectation of a quick delivery. But, the address provided is vague or lacks specific details.
The delivery service, relying on traditional geocoding methods, struggles to locate the exact destination, leading to multiple failed delivery attempts. This not only frustrates the customer but also incurs additional costs for the retailer due to the need for re-delivery and potential refunds.
Logistical Inefficiencies in the E-commerce Sector
The data above suggest: that the e-commerce market in the Philippines is experiencing rapid growth, with a market value of ~$17 billion driven by over 73.91 million internet users. But, logistical inefficiencies stemming from inaccurate address information create substantial operational bottlenecks.
Further, many consumers in the Philippines prefer COD (~67%), but the lack of standardized addressing can lead to delivery failures. For instance, a customer may provide an ambiguous address or simply miss adding landmarks: eg. parks, cafes, and businesses resulting in misdeliveries, increased operational costs for retailers, and frustrated customers.
E-commerce contributes ~0.5% to the GDP, equating to ~$2.4 billion. Inefficiencies in logistics not only impede this growth but also impact consumers who rely on timely deliveries of essential goods.
As a business owner: you don’t want a frustrated or unsatisfied customer.
These logistical challenges echo the broader issues seen in the global returns industry, which reached ~$1.8 trillion in 2022. Just as high return rates can erode profitability and sustainability, logistical inefficiencies in every region around the world. The e-commerce sector threatens to undermine its potential, ultimately affecting the long-term sustainability of the business.
Proto, with its Localcode, offers a robust solution to address these challenges through its innovative and community-driven Localcode system.
What exactly is Proto?
Proto offers a secure, human-readable addressing format called Localcode (If you want a deeper dive into its features, I highly recommend their blog post “Localcodes: Bringing location on-chain”). Unlike traditional addresses, Localcodes are user-generated; incentivizing mappers (or Cartographers) to create more accurate and accessible location data. This community-driven approach empowers users to generate and share unique Localcodes, enabling precise address resolution globally.
How Proto Addresses These Challenges?
Proto leveraging localcode has done something that traditional systems couldn’t: it has made location data both human-friendly, community-driven and incredibly precise — to wit:
a) Enhanced Location Identification
At the heart of Proto's solution is the ability for users to create unique identifiers for their locations. These identifiers consist of four key components:
Username. A unique username or chosen ID for the user;
Placetype. The type of place, selected from an expanding list of categories in Proto's Mapper App;
Domain. Currently set to 'proto' by default, with plans to support custom domains in the future;
Identifier. An optional additional identifier to distinguish between multiple similar places.
Let's say this represents a real restaurant in Quezon City. The actual address might be:
"123 Maginhawa Street, Teachers Village East, Diliman, Quezon City, 1101 Metro Manila, Philippines"
These codes, such as DIGIPIN and ProtoID, can encapsulate detailed information like sub-meter resolution coordinates and full address data. For instance, in this system, the user "johndoe" could use their ProtoID to uniquely reference their restaurant location.
While the code itself doesn't directly contain the full address, Proto's system associates this identifier with the corresponding address details. This customizable format provides a concise, shareable identifier that can be used in various contexts.
b) User Empowerment
By allowing individuals and businesses to generate their own Localcodes, Proto fosters a sense of ownership over address data. This self-service model encourages users to keep their information accurate and up-to-date, transforming their relationship with logistics providers into a collaborative partnership aimed at improving delivery efficiency.
c) Community Engagement
Proto’s incentivized approach encourages users to actively participate in the mapping process, contributing their knowledge to build a comprehensive database of addresses. This community-driven effort not only enhances data quality but also fosters a sense of belonging among users, leading to continuous improvements in address accuracy and reliability.
d) Cost Reduction
One of the primary advantages of Proto's Localcode system is its potential for cost reduction. By improving address resolution, Proto can significantly lower the costs associated with failed deliveries and re-delivery attempts. For instance, if a typical failed delivery costs a retailer money, a mere ~20% reduction in failure rates could save businesses millions of dollars annually. This savings not only improves profit margins for retailers but also enhances the overall efficiency of the logistics network.
e) Increased Efficiency
Accurate Localcodes enable delivery personnel to optimize their routes, resulting in faster delivery times. This efficiency not only boosts customer satisfaction, as packages arrive promptly, but also allows businesses to handle a higher volume of transactions. With streamlined operations, retailers can scale their services to meet growing demand, contributing to overall market growth.
eg. video below that Mappers on Proto contributed real-time imagery along with data. This is a Realistic 3D of a Temple in Nagpur. It's currently in its early stage, but we can expect significant advancements in the future. credits: @dp_proto.
As the e-commerce sector continues to expand, the ability to resolve addresses accurately becomes increasingly crucial. By addressing logistical challenges, Proto can facilitate a smoother flow of goods, which is essential for maintaining the momentum of e-commerce growth. This improvement could potentially increase the sector's contribution to the GDP beyond its current ~0.5%, unlocking further economic opportunities and enhancing consumer access to goods and services.
To Sum Up
Proto is a revolutionary platform that addresses the inefficiencies of traditional address resolution in the e-commerce sector. By introducing user-generated, human-readable Localcodes, Proto offers enhanced accuracy, empowers users, fosters community engagement, reduces costs, increases efficiency, and drives market growth.
Why Proto is Uniquely Positioned
So why Proto? Why not Google Plus Codes or What3Words? Simple: those solutions are centralized and often lack the flexibility needed for local adaptation. Proto's incorporation of Localcode and dePIN (or Decentralized Physical Infrastructure Networks) fosters a community-driven approach to location data: Proto empowers users to own their data by enabling them to contribute and manage location information. This direct involvement ensures that data accurately reflects the local environment, giving users greater control over how their input is used.
Proto is not just a mapping platform; it’s a dynamic tool tailored to the evolving needs of the Philippines' e-commerce and retail landscape. It serves as a "Points of Interest" (PoI) app that empowers users to map everything from busy retail hotspots to tricky delivery zones.
Key features of the Proto app include:
Create and Share PoIs. Users can easily map and share their insights by tagging locations, adding addresses, and including a brief message about what makes the place special. A well-taken picture can also be uploaded to enrich the entry, improving the accuracy of address data crucial for logistics.
Journey Creation. Link Check-Ins to craft engaging narratives, like delivery routes or shopping guides, bringing maps to life and making them more useful for businesses and consumers alike.
Rewards for Contributions. Every pin dropped, tag added, and journey created is recognized, allowing users to earn rewards—an essential feature in a market where community-driven data can dramatically improve logistics.
User-Friendly Experience. Proto's intuitive interface makes it accessible for everyone, ensuring that even those unfamiliar with mapping can contribute effectively to the ecosystem.
Community Engagement. Users become part of a global community of mappers, sharing insights and collaborating to build a rich ecosystem that values each contribution, directly benefiting the logistics and retail sectors.
By leveraging these features, Proto fosters a resilient, responsive mapping ecosystem that adapts to the dynamic needs of the Philippines' local landscapes. You can get the app for Apple on App Store and for Android on Google Play
YourLocalPlaces + Your Story = Chad Protomapper
To learn more about becoming a proto-mapper I highly recommend that you check out their mapper guidebook.
Addressing Concerns and Driving Adoption
Of course, any new technology faces its hurdles. The main concerns around Proto’s system—privacy, ease of use, and sustainability—are valid, but Proto has smartly addressed them. Localcodes allow users full control over what information they share and with whom, making it inherently more privacy-conscious than other systems (your map, your data).
Its intuitive interface means that anyone, regardless of technical ability, can use the system effectively (with a lot of future improvements). The tokenized model (in the future), ensures fair compensation, keeping the system robust and user-driven over the long term.
WRAPPING UP
Proto's innovative approach represents a fundamental shift in how location data is harnessed (like the Philippines which stands to benefit its E-commerce immensely). By emphasizing decentralization, Proto empowers “users to take control of their data”, creating a community-driven mapping system that rewards participation (“map-to-earn” model). This approach addresses the limitations of centralized systems like Google Maps, offering greater accuracy, efficiency, and local engagement.
This revolutionary platform not just only impacts the e-commerce sector but also others like:
Real estate for precise location data for property listings;
Emergency Services to help expedite response times and improve the efficiency of rescue operations;
Government Services can be used in various government applications, such as property taxation, census data, and disaster management;
Tourism & Travel By providing detailed and accurate location information, Proto can enhance the experience of tourists and travelers, helping them discover hidden gems and navigate unfamiliar areas.
Proto's influence is not confined to the Philippines. With a growing community in India, it has the potential to revolutionize address resolution “worldwide”. By improving efficiency, reducing costs, and enhancing quality of life, Proto is poised to become a global leader in location-based technology.
References:
https://ecommerce.dti.gov.ph/madali/ecommerce_numbers.html
https://www.trade.gov/country-commercial-guides/philippines-ecommerce
How Returns Impact the Profitability and Sustainability of Retail Businesses
https://proto-geo.medium.com/localcodes-the-92e15a00bf9e
https://protomap.xyz/blog