Analysis of Southeast Asia e-commerce market: shopping habits, platform competition and market potential
The e-commerce market in Southeast Asia is in a period of rapid growth, attracting the attention of many e-commerce giants around the world, including China’s Alibaba and Tencent, which respectively control Lazada and Shopee, the two largest e-commerce platforms in Southeast Asia. At the same time, Amazon in the United States is also testing the waters at its Singapore site. This series of competition will promote the development of the entire market. Southeast Asia is not only an opportunity for platform e-commerce, but independent website e-commerce has also received good development space, presenting a situation where platforms and independent websites coexist.
Unique characteristics of the e-commerce market
Consumers in Southeast Asia are increasingly showing diversified demands for product types when shopping online. According to data from the Hong Kong Trade Development Council, 73% of consumers believe that “being able to shop anytime and anywhere” is the main reason why they choose to shop online. Following closely behind, 69% of consumers said convenient price comparison is equally important. More than half, or 55%, of consumers believe that online commerce provides a much wider variety of products than traditional stores.
Despite the rapid economic development in Southeast Asia, the overall consumption level is still low, making consumers prefer high-quality and low-priced fast-moving consumer goods. In addition, the market is rife with concerns about fakes and poor service, and consumers have lower trial and error costs. Frequent promotional activities in Southeast Asia, such as “9.9”, “Double 11” and “Double 12”, etc., prove the importance of promotions to consumers. These activities attract a large number of consumers to use coupons and participate in discount activities.
Mobile terminal and diverse payment methods
The rise of mobile e-commerce is particularly obvious in Southeast Asia. Research shows that at the beginning of 2020, mobile traffic accounted for more than 70% of all e-commerce traffic, especially in Indonesia, where the proportion of mobile traffic was as high as 87%. In addition, payment methods are diversified in Southeast Asia, especially in countries with low credit card penetration, where cash on delivery and bank transfer have become the main payment methods. In Vietnam and the Philippines, more than 80% of e-commerce companies provide cash on delivery services.
Working time shopping and multi-channel decision-making
Research shows that the number of shopping orders made by Southeast Asian consumers during working hours is much higher than at other times, which reveals that consumers’ shopping habits and channel choices are becoming increasingly diverse in their daily lives. In addition, when shopping for high-value products, consumers tend to search online first, then conduct offline comparisons, and finally choose the most advantageous shopping method. This multi-channel shopping decision-making has been deeply integrated into local life.
To sum up, the characteristics of the Southeast Asian e-commerce market, consumer shopping habits and the diversity of various payment methods provide abundant opportunities for the development of local e-commerce. As market competition intensifies, cross-border e-commerce sellers should seize the opportunity to make full use of the potential of this blue ocean market.