Online Shopping Behavior of Southeast Asian Consumers in 2020
Southeast Asia’s eCommerce market has recorded massive growth in the past few years. While Accenture predicted growth from 2016’s $14 billion to $32 billion in 2020 for the ASEAN eCommerce market, Google’s estimates go even further, expecting Southeast Asia’s internet economy to hit $300 billion by 2025. And due to the current COVID-19 pandemic, Southeast Asia’s surging demand for online shopping has increased even further. But how did the eCommerce shopping behaviour of SEA users change in 2020?
Bear with us as we explore the region’s latest trends in this article!
Grocery Shopping Moves Online
According to the joint study of Facebook and Bain & Company, Southeast Asian businesses already had a significant opportunity to fill the online retail gap before the pandemic. And digital grocery shopping proved to be one of the leading opportunities for them. Due to the pandemic’s effects, Southeast Asian users have increasingly turned to the $350 billion online grocery shopping market. As a result, researchers have witnessed a 44% and 48% increase in digital spending for packaged and fresh groceries, respectively. While this seemed like a short-term trend first, between 80% and 83% of Southeast Asian consumers have stated that they will keep to their new digital grocery shopping habits in the future.
Increased Ecommerce Spending During Online Sales Events
With a 56% increase in consumer spending compared to a typical day, online sales events are crucial for eCommerce businesses targeting Southeast Asian users. Based on this data, eCommerce companies can potentially be as effective in digital sales events as malls do by attracting large crowds with physical sales promotions. Researchers have discovered that Singles’ Day (November 11) is the most prominent digital shopping event where Southeast Asian users spend 74% more than on an average day.
Mobile Apps Are Key to Growth
While a web interface can work for eCommerce shopping, it’s no longer enough for digital stores to attract Southeast Asian users. And it’s no surprise as users in the region prefer to use their smartphone devices for digital shopping, a trend which has been growing with the surging number of mobile connections in the SEA. While researchers estimate the number of mobile connections to reach 800 million in Southeast Asia, GSMA’s study predicts that smartphone adoption in the APAC region will surge from 2019’s 64% to 81% by 2025. Based on this data, it’s safe to say that mobile apps play a crucial role in engaging SEA customers for eCommerce businesses. Facebook’s research confirms the same, stating that 85% of Southeast Asia’s digital consumers have tried new digital smartphone apps in Q1 2020. Among SEA citizens, eCommerce apps scored the third position for first-time use while ranking in the fourth place for the most used app categories during the pandemic.
Contactless Payments and ‘Stay at Home’ Behavior On the Rise
In fear of getting infected and due to government lockdowns, Southeast Asian consumers have increasingly stayed at home during the pandemic. Because of the same reason, contactless payments have been on the rise in the region, even in markets where citizens predominantly use cash for shopping. For example, researchers have discovered that the mobile money service Philippines GCash has experienced a 30% surge in transaction volumes since the pandemic’s start, ranking first among the most downloaded finance apps in the Google Play Store.
Consumer Loyalty Makes Established Brands Stronger
While the region’s digital users are open to trying out new brands, 42% of SEA consumers preferred to purchase products from (more) established brands since the pandemic’s start. This new trend can be explained with consumer loyalty and trust, and that established brands feature more robust supply chains so they can ensure that their products and services are available and visible for consumers (most of the time). On the other hand, researchers have discovered that one in three SEA consumers will switch stores in case they can’t find their preferred brands.
Sources:
Marketing In Asia — Analyzing Southeast Asia’s Online Shopping Behavior Facebook Business — Southeast Asia digital consumer trends that shape the next normal
Accenture — Riding The Digital Commerce Wave
Google — e-Conomy SEA 2019
The Jakarta Post — C0VID-19 changes Southeast Asia’s consumers
GSMA — The Mobile Economy 2020
Originally published at https://www.sticpay.com on September 21, 2020.
