More growth in the e-commerce industry is expected, says report

THE e-commerce industry is expected to continue its growth path to likely reach US$172 bil in value by 2025, especially in six of the largest Southeast Asian markets.

In iPrice Group’s Map of e-commerce Year End Report 2020, last year signified strong customer confidence in e-commerce retail, despite restricted mobility and the mounting concerns over the global pandemic.

The report revealed that the overall website traffic of online shopping platforms increased positively across all countries year-over-year. This can be seen most in Singapore, which experienced a surge of 35% compared to 2019, followed by the Philippines (21%), Vietnam (19%), Malaysia (17%), Thailand (15%), and Indonesia (6%).

Data also showed that online department stores’ web traffic experienced a 52% average increase from 1Q 2020, signalling that most countries in the region flocked to online department stores instead of physical stores due to social distancing.

Nonetheless, some e-commerce sites’ web traffic has taken a beating due to the pandemic.

For instance, platforms that offer cosmetic products showed an average web traffic decrease of 35% from 1Q to 4Q 2020. Meanwhile, fashion and electronics sites also experienced a slight decrease of 14% in traffic in the six aforementioned countries.

This goes to show that while the demand for essential goods is still necessary, COVID-19 has broadened the online demand of Southeast Asian consumers for non-essential items such as fashion, electronics, health & beauty, and sports & outdoors that were seen through online spending instead.

It was also discovered that consumers in Southeast Asia spent an overall average of US$32 per order in 2020, which was 19% higher than 2019’s. Singapore and Malaysia saw the highest average basket size of US$61 and US$41 respectively in 2020.

As most people were embracing technology in response to a volatile and uncertain situation, there is a prime opportunity for mobile shopping apps to continuously engage with Southeast Asian consumers.

Major e-commerce companies across the region have approached this strategy by rolling out other marketing campaigns that drew customers through gamified features on the app, free shipping, and discounts.

Therefore, as the COVID-19 pandemic provide further impetus for e-commerce growth, shopping behaviour will continually shift. It remains imperative for most e-commerce companies to strengthen their relationship with consumers through relevant campaigns. – March 22, 2021

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