There is immense potential for companies in Southeast Asia to build brand loyalty and growth as there is no dominant player in the eCommerce market, according to a new study titled "Riding the Digital Wave: Southeast Asia's Discovery Generation" by Bain & Company and Facebook.
The study, which surveyed 12,965 CEOs and venture capitalists across Indonesia, Malaysia, Philippines, Singapore, Thailand, and Vietnam, said that Southeast Asia's savvy consumers shop-hop across 3.8 platforms on average before they make a purchase decision. Therefore, creating customer rewards through loyalty programmes emerges as an imperative.
According to the study,
Loyalty members were 45% more likely to make recommendations across categories, 25% more likely to have higher purchasing frequencies across categories and 20% more likely to have higher spending across categories.
Besides a huge potential to build brand loyalty, the study also said that discover is all-important as 67% of respondents said they do not exactly know what they want to purchase before they shop online, with more than 50% of respondents saying they learn about new products and brands via social platforms. Southeast Asian shoppers showed a strong preference for omnichannel, with over 80% saying they compare prices across online discovery platforms and in-store before they make a purchase decision.
The top three reasons for making an online purchase were positive reviews from other users, good deals or promotions and interesting products.
Bain's study also said that by 2025, there will be 310 million digital consumers in Southeast Asia. By then, it estimated that online spending will outpace the growth of digital consumers by a factor of three, with clothing and personal care emerging as two of the leading categories. In 2015, the region had 90 million digital consumers but grew 2.8 times to 250 million in 2018.
Meanwhile, Sandhya Devanathan, country MD, Facebook Singapore said there is no longer just one way to shop and nobody shops the same way twice.
"In Singapore alone, 75% of the respondents said that they are either open to other brands or will buy from multiple brands when shopping online. This means businesses of all sizes, including specialty players have a significant opportunity to compete on a larger scale in Southeast Asia," Devanathan added.
"Brands need to be very savvy and re-imagine their marketing and trade spend to be in sync with the ever-evolving omnichannel consumer journey. They also need to build new muscles to ensure a positive online shopping experience to their digital consumer," Praneeth Yendamuri, partner at Bain & Company, said.
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