Ecommerce sales in Southeast Asia projected to grow 18% in 2022

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A whitepaper released by Ascential Digital Commerce highlights the rapid growth of ecommerce sales across Southeast Asia (SEA) and explores the opportunities and challenges consumer brands face as ecommerce becomes the number one driver of retail strategy in the region.  

Navigate Retail 5.0 in Southeast Asia lays out how consumer brands in the region can thrive in a new era of shopping – what the paper’s authors describe as Retail 5.0.

But the requirements to succeed online are very different to the physical store. The paper suggests that optimising digital retail platform growth can only be accessed by adopting a fundamentally different set of capabilities, skills and in many cases, wholesale organisational change.

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The whitepaper projects ecommerce sales in the region to grow nearly 18% to reach US$38.2 billion by the end of 2022, up from US$31.9 billion in 2021. By 2026, ecommerce sales are projected to reach US$57.8 billion. This comes after bumper ecommerce growth in 2020 of US$27.4 billion and shows how pandemic shopping behaviour has changed retail for good. 

Indonesia, one of SEA’s largest online commerce markets, is expected to add  $9 billion in ecommerce sales in 2022, while the Philippines, Vietnam, Thailand and Malaysia are also key markets to watch.

One of the key takeaways in the whitepaper for brands is to focus resources and investment on mass personalisation to reach and retain digital-first shoppers, who use smart devices, such as laptops and mobiles, to discover, select, purchase and engage. But the whitepaper cautions against consumer brands from jumping on the bandwagon and crowding the mass personalisation space.  

“Southeast Asia is brimming with opportunities for retail operators. In this evolving Retail 5.0 landscape, retail operators must constantly reevaluate their investments and innovation strategies to stay relevant, grow, and effectively tap into the largest ecommerce marketplaces,” said Jill Meng, Customer Success Director, APAC, Ascential Digital Commerce. 

“Consumers are dictating and shaping the retail sector, informing brands about their preferences via social media or conversations. Consumer brands that can analyse, adapt and adopt solutions quickly to the new shopping environment will win these dollars,” said Xian Wang, Vice President, Retail Insights, Edge by Ascential. 

“With shifting consumer behaviours, ecommerce and fast delivery are now considered table stakes. Consumers expect much more from their online experience. They want to try new products frequently, have personalised experiences, seamless customer journeys, and interactive engagement,” said Saad Ahmed, Managing Director, Regional Head of Merchants & Commercial, Grab.

Key recommendation to win marketplace shoppers 

  • Identify how your shoppers are searching for your brand and products online and understand their purchase journey  
  • Get full oversight of your and your category’s performance, sales and share online and on the marketplaces you are selling through to inform effective business decisions 
  • Understand the marketplace dynamics and their capabilities to focus investment in the right places 

On the product side, consumer brands must ensure a highly flexible product innovation and distribution model where sufficient stock is immediately available for rapid distribution globally.

This is crucial especially as businesses can lose up to 22% of weekly sales every day a product is out of stock, according to data from Edge by Ascential.