Southeast Asia sees big shift to e-commerce during COVID-19

Driven by changing consumer trends during COVID-19, the Southeast Asian e-commerce industry has grown substantially in the first six months of the year, according to a recent report by price comparison and product aggregating website iPrice Group.

The report pointed out major changes in consumers’ behaviours and the e-commerce industry brought about by COVID-19 in Singapore, Malaysia, Indonesia, Thailand, Vietnam, and the Philippines, mainly a strong shift from offline to online in consumer spending.

In the first half of 2020, website traffic of online general department stores increased in Indonesia, Thailand, Malaysia, and Singapore by up to 18 percent compared to the second half of 2019.

In contrast, fashion websites took a hit with average traffic declining in all six countries. Thailand’s fashion websites performed the worst on average, falling 62pc during the period, while Indonesia’s fashion startup Sorabel also went bust. Meanwhile, heavy downturns were seen in Malaysia for electronics websites.

These results prove that the pandemic has changed consumers’ online shopping demands. Demands for non-essentials items such as fashion, cosmetics, and smartphones slowed down significantly, while demands for essentials such as groceries and health supplements shot up.

In 1H2020, average order values for electronics and fashion increased by only 18pc and 11pc year-over-year on iPrice’s portals. Meanwhile, average order values for health and home and living products increased by 25pc and 26pc respectively.

E-commerce providers across the region were quick to adapt to the new trends. For example, almost all major e-commerce marketplaces in the region had multiple sales campaigns to promote health supplements and groceries. Some invested in logistics to assure these essentials get to the consumers. In April, Lazada expanded their fresh produce category to Malaysia, Vietnam, and Indonesia. In May, Vietnamese company Tiki introduced

In the second quarter of the year, according to reports of iPrice Group and App Annie, the total number of sessions on shopping applications in Southeast Asia reached 65.1 billion, which is an increase of 39pc compared to Q1.
Leading this jump in usage is the Philippines, Thailand, and Vietnam with increases of 53pc, 50pc, and 43pc respectively. Meanwhile, Indonesia leads the region in absolute number with 28.5 billion sessions in 2Q alone.

Data from iPrice’s e-commerce portals show that the average basket or cart size across the region increased by 23pc year-over-year in the first half of 2020, reaching US$28.50 per order. The Philippines and Singapore showed the biggest increases at 57pc and 51pc respectively.

While the iPrice report did not include data on Myanmar, recent trends show a big shift to e-commerce, too. Just last week, Telenor Myanmar announced the launch of Telenor Zay, a digital marketplace designed to bring seamless shopping experiences to Telenor customers.

Services available already on Telenor Zay include groceries and food delivery, health care services such as online medical appointments and telemedical consultations as well as the purchase of vehicle insurance services.

A recent report by Telenor showed that COVID-19 has led to a surge in online shopping. Services that deliver food, groceries, medical supplies and packages are thriving in Myanmar. Another survey by U Report Myanmar showed that there was a 7pc increase in online delivery of groceries than usual amidst COVID-19.

This has also led to rising adoption of digital payment methods, with data analytics company Statistica projecting a 7.1pc increase in digital transactions and a 19.7pc rise in the number of users in Myanmar this year.

“We believe online shopping will see significant growth in Myanmar going forward, especially as the digital ecosystem and the digital readiness of both customers and businesses continue to evolve,” Amaresh Kumar, Chief Marketing Officer of Telenor Myanmar, said in a statement.

Source : Myanmar Times

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