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E-commerce
OpinionComment
Vaughan Ryan
Vaughan Ryan

Eye on Asia | As e-commerce starts to mature in Asia, retailers must rise to new challenges

  • How to retain customer loyalty amid market fragmentation and increasing demand for ever faster delivery will be the key challenges for all retailers
  • In the next 20 years, retail will be less about logistics and more about pushing the envelope on personalised discovery and curation

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A live-streamer sells children’s clothes in Zhili town, Huzhou, Zhejiang province, on February 8. Live-streaming, group buying and new forms of social shopping are emerging in Asia as e-commerce explodes. Photo: Xinhua
Vaughan Ryan

We have entered the end of the beginning of e-commerce in Asia. Just as Asia has led the retail growth engine over the last decade, it now accounts for over 50 per cent of the world’s e-commerce sales. Today, it is no longer a question of whether people will shop online but rather how frequently they buy and how much they will spend.

E-commerce was always destined to transform retail, but Covid-19, without question, accelerated its trajectory. While the first 25 years brought digital access and tested concepts of superior retail experiences, the last year proved its necessity and viability.
In Thailand, we saw a 58 per cent increase in the number of households buying online while neighbouring countries also saw growth: Singapore with 47 per cent, Hong Kong with 46 per cent, and urban Indonesia with 15 per cent. In countries where movement control orders have been far stricter due to Covid- 19, such as the Philippines, the increase was recorded at 325 per cent.

The frequency of online shopping also rose. As an example, there was an increase of 29 per cent in the number of times consumers shopped online in the last 12 months in South Korea. The even better story is in markets such as Singapore, where not only did trip frequency grew by 11 per cent, but spending online also grew, by 16 per cent.

As a result of e-commerce’s growth, the power dynamics between consumers, brands and retailers have shifted, and digital players such as Alibaba Group Holding (the parent company of the South China Morning Post), JD.com, and Pinduoduo Inc now sit at the top of the retail food chain. Today, livestream retail takes the centre stage in Southeast Asia through Shopee and Lazada, and bonds of consumer loyalty and trust are being strengthened through the networks and communities engaged in social shopping.

02:24

Foreigners in China join army of online live-streamers to sell Chinese products around the world

Foreigners in China join army of online live-streamers to sell Chinese products around the world

While the rate of change will vary across borders due to each country’s state of digital maturation, what is certain is that almost all the growth in the retailing of fast-moving consumer goods will now come from e-commerce.

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