Why checkouts are holding Southeast Asia merchants back

Liat Beng Neo, co-founder and CEO of Arrow

The online shopping space has been growing and evolving.  Merchants are constantly under pressure to deliver shopping experiences that make it easier for their shoppers. As a result, shoppers around the world, including those in the US and China, have embraced significantly improved checkout experiences in recent years – ones that focus on being fast, intuitive, and locally relevant.

Comparatively, shoppers in Southeast Asia have yet to enjoy similar levels of convenience. The increasing number of payment methods and payment gateway options further complicates the checkout process. One of the biggest complexities is the popularity of non-credit card payment methods such as bank transfers, which can necessitate tedious and manual processes.

A typical checkout process of a bank transfer requires shoppers to log in to their bank of choice. While the payment may be instant deduction from the shoppers’ bank accounts, merchants may need to manually reconcile the payment. Other payment methods include digital wallets or even offline payment methods which require shoppers to first pay at a location such as a convenience store before updating the merchants to complete the transaction.

Some areas in Southeast Asia do not enjoy stable or strong Internet connectivity. Merchants cannot afford to build out a complex checkout system as every additional step in the checkout process can add a significant amount of loading time. Shoppers may drop off, or get cut off, leading to a lost sale.

Online checkout: It is more than just payments

Merchants in this region face a tremendous level of complexity. Most assume that checkout is simply paying for one’s purchase and is as easy as at the supermarket where one loads the conveyor belt with shopping basket items.

However, the reality is that online checkout is more than just payments. At the point of checkout, shoppers’ identities and details that include personal details and shipping information are being collected and verified. Loyalty programs are also verified during this stage where shoppers confirm whether they can earn or burn points.

Next comes one of the most critical stages for the increasingly astute shoppers where they find out whether their promo codes are valid. “No promo code no checkout” is a fact where most shoppers may drop off at this stage when they do not have a working promo code that allows them to enjoy the benefits. Payments happen only after all these details are verified and fulfilled.

Additional challenges add up

Other operational realities that are unique to the region adds on to the challenges for the merchants. To be competitive, most businesses offer different shipping for the different areas they ship to. In many parts of Southeast Asia, some addresses and postal codes are not sufficient for successful delivery. Detailed instructions specifying how to get to a location are often necessary for the delivery to complete.

While the processes sound complex, it is how a large proportion of shoppers in the region prefer to buy. Not offering these payment methods and shoppers’ benefits programs may lead to merchants losing their market share in the competitive e-commerce marketplace. Providing these needs, however, brings great complexity and operational cost, which significantly impacts its bottom line.

We have seen how the right technology has allowed merchants to effectively deliver a consistent experience for their shoppers, allowing them to easily and quickly checkout. The technology should be easily integrated into merchants’ existing setup without having to incur huge additional investment or complicate their existing processes. Only then can the merchants focus on selling more of what they already sell.

Turn every shopper’s touchpoint into an opportunity

For merchants in the region that want to take a step further to increase their sales, they can take advantage of the tight integration of the checkout technology to turn every shopper touchpoint into a possible sales channel. 

Merchants can effectively adapt checkout for their shoppers on social media and chats to allow them to checkout wherever they prefer. Social commerce may seem complex to manage, but it does not need to be, given the right solution.

Rescue and recover shoppers’ abandoned carts

Merchants can also look to recover missed opportunities of their shoppers’ abandoned carts with a customized message that leads the shoppers directly to checkout. The direct link to their abandoned carts makes it easier for the shoppers, allowing them to complete the transaction with a single click.

While there are many challenges merchants face in Southeast Asia, the large population of savvy shoppers also present a great opportunity for the merchants. Providing a consistent shopper experience with fast and easy checkout across all platforms makes it easier for merchants to run their e-commerce businesses. This may be the best investment merchants can make for their online business.