The South East Asian countries are a chunk of developing nations with high consumeristic populations. The expected user penetration is likely to touch 53.8% in 2022 and further grow with CAGR rate of 15.08%; This owes to the availability of smartphones in each hand with reliable internet connection. The provided statistics also project the market volume to touch about US $217.50bn by 2025. This growth rate and projections owes to the improving living standards of the middle class families of all the developing SEA nations like Malaysia, Philippines, Thailand, Vietnam and Indonesia. As per reports, by 2025, Indonesia alone will account for 50% of the Southeast Asian E-commerce market. The average GDP of 9 countries also accounted for 55.64% making Southeast Asia as one of the most consumerist and attractive markets for e-commerce.
A Consumer’s Shopping Story in SE Asia
Shiv is a student from Singapore. For shopping his clothes, he stalks collections on the e-commerce website of his favorite brand. In parallel, he checks the availability of those brands on competitive e-commerce websites like Amazon and Shoppee to grab the best deals. He places orders for brands that accept returns to be on safer side. In his free time he prefers to visit the physical stores for shopping and enjoy the luxury experience of trying clothes to check for his size, fit and materials of apparel collection. He also makes it on his list to visit the stores at times of sale.
Shiv has encountered new local stores and some boutiques as well from social media platforms like Instagram where he enjoyed customised clothing trials. He also explored new apps that provide AR features to demonstrate how a particular shirt or Tee shall look on him. Thus, he mostly prefers to shop online now. He finds a variety of apparel collections to choose from at great deals which are delivered at his doorstep. Yet he admits the joy of the offline shopping experience to be superior and visits stores as per his convenience.
SEA E-commerce Trends 2022
The shopping story of Shiv resembles what a customer is likely experiencing across the globe. We further discuss the impact of the burst in E-commerce trends in Southeast Asia.
1. Omnichannel Experiences
The shopping trends in e-commerce have escalated the charts post pandemic wave of 2020. The availability of the products on online platforms and offline stores have made it more convenient for customers to enhance their shopping experiences. The shopping journey is more complicated than ever before. Many people prefer offline window shopping before making an online purchase and many just cannot survive without online shopping. The SEA shopping experiences are a combination of both online and offline shopping.
All the touchpoints are considered while planning online shopping. These include websites, apps and social media platform selling. The channels are customized to provide a smooth shopping experience in both mobile phone or laptop or even a physical brick-and-mortar store. This strategy to provide omnichannel shopping exposure has multiplied the customer outreach making it the most evident of B2B e-commerce trends 2022. In correspondence, companies like Hopstack provide highly optimised omnichannel order management suites that help fulfillment centers in consolidating all their offline and online orders in one place. This has provided a high workflow flexibility and visibility to the warehouses and fulfillment centres. (Schedule a free demo today to know more.)
2. BOPIS (Buy Online Pickup in Store)
BOPIS stands for Buy-Online-Pickup-In-Store. This is also popular by names click & collect or ROPIS (reserve online and pickup in store). As the name suggests, the user can shop online and conveniently pick up their purchase from a store. This is like an amalgamation of an online as well as offline shopping experience in one. It ensures that the customer gets what s/he is looking for when he has planned to visit the store and make payment for the booked product or avail returns, exchanges, etc.
3. Expedited Shipping
Expedited shipping is an upgraded option to standard or regular shipping time. Customers look forward to the availability of such options in order to get some emergency orders in the least possible time. There is no doubt the customer expectations for standard delivery too have reached 24-48 hours. Yet customers do not mind paying extra for exclusive available options whenever required. A research showcased that 41% of consumers agree to pay charges for same day delivery while almost a quarter (24%) of shoppers are willing to pay more to receive their delivery within one or two hour window. The increased expectations and demands of customers ascertain the stay of this trend of expedited shipping.
4. Rise of E-commerce Markets
Ten years back you wouldn’t have heard of online shopping or companies like Flipkart, Tokopedia or Shoppee. All these companies provide an e-commerce platform to C2C, B2C and now B2B markets as well.
For example, Tokopedia was established in 2009 with the purpose to bridge the gap between the buyers and sellers of Indonesia. It is the only Southeast Asian Company that has been funded with 100 million dollars from Sequoia Capital and Softbank. The online marketplace company announced a merger last year with Gomel - a leading mobile on-demand services and payments platform to become GoTo group. Tokopedia attempts to deliver the same purpose with a lot of demands and innovations.
Similarly, Shopee - a multinational technology company that focuses on e-commerce was founded in Singapore in 2015. Right now, it is spread across 14 countries and was declared as the largest e-commerce platform of Southeast Asia last year, that is, in 2021.
Hence, the budding e-commerce markets are endeavouring for such entrepreneurial ventures that bring with it a substantial innovative platform and influence.
5. Revived Technology
The generations before millennials can empathise with the fact that we are living in a completely new era where everybody has a mobile phone. Not only that, the phones are like mini computers that support fast internet connectivity. The smartphones have kind of become a necessity. This is the reason that e-commerce came into existence altogether. In parallel a lot of innovations are done around this new liability to customise and enhance the online shopping experiences.
For example, Augmented Reality is used in websites and mobile applications to provide the ‘virtual try on’ feature to the customers to give an exact idea of how a fashion product would look on them. Even otherwise, companies provide 3D views of objects using AI technology for better product understanding and details.
Certainly, the innovations in technology are to stay and evolve with the feedback of customers and their shopping habits. Technology can be considered an evergreen trend for e-commerce in Southeast Asia and across the globe.
6. Checkout and Payment Innovation
Forbes says that Checkout holds the key to success in digital e-commerce. The key to a successful checkout is flexibility of varied payment options. For example, credit cards, debit cards, COD (cash-on-delivery), BNPL and much more.
BNPL stands for Buy-Now-Pay-Later. This is the latest trend inspired by years of transactions where-in the customers can pay a certain amount to book their purchase and pay all the amount later on a predefined date, with no additional charges or interest on it. BNPL accounted for 2.1% of the e-commerce transactions (equivalent to about $97 billion) in 2020. It has magnanimously attracted the millennials and Gen-Z to avoid add-on credits.
These innovative payment options provide superior convenience in the customer shopping experience. Therefore, these payment strategies intrigue the middle class sect of customers to shop more and top the chart of E-commerce trends in Southeast Asia.
Take Away (Summary)
The shopping journey of Shiv is an inclusive example of the e-commerce trends of Southeast Asian countries. He has flexibility to visit stores or shop online as per his convenience (omnichannel strategy). He uses websites, apps and social media that allows him to tap into new online channels of shopping and marketplaces (budding platforms like Tokopedia and Shopee) that allow him ‘virtual try-ons’ (revived technology). He enjoys offline shopping but certainly cannot survive without the convenience of online shopping (doorstep shipping and payment options). The journey of Shiv ascertains how retailers should stay at par with the current e-commerce trends to ensure their visibility and sales in a highly volatile and competitive evolving market.
The Southeast Asian zone is witnessing a massive surge in 3PL and e-commerce companies. These companies need powerful fulfillment operations to meet customer expectations and withstand competition. Companies like Hopstack are in full-fledged support to ease these operations related to entire management of warehouses or fulfillment centers. Hopstack provides integrated Warehouse Management Operating Systems that are quick to install, economical and backed with latest technologies.
The major take away from the e-commerce trends in Southeast Asian countries is that upgradation and innovation in trade and technology is to stay and grow more for the upcoming generations. For e-commerce companies, the best solution is to merge trade with technology, that is, optimize every step of the fulfillment process with the software products offered by Hopstack.