Guide to eCommerce Promotions in Asia
Ecommerce sales in Southeast Asia is projected to hit USD89.67 billion in 2022 and is expected to go past the USD100 billion mark by 2023. With the region poised to be the fastest growing in the world, there is no better time to jump on the eCommerce bandwagon than now.
Online retail has been growing steadily over the years but store closures in 2020 and 2021 brought on by COVID-19 accelerated its growth. Pre-pandemic, Southeast Asia only had an estimated USD112 billion eCommerce gross merchandise value in 2021, but according to the latest report by Sync South-east Asia, it is projected to reach USD280 billion by 2027.
To put things into perspective, Asia made up 58.9% of global eCommerce sales in 2020, with China taking up 34.9% of sales from Asia, according to a report by Digital Commerce 360. Key countries in Southeast Asia contributing to this sudden growth are Indonesia, Malaysia, the Philippines, Thailand, and Vietnam, indicating a shift in consumer patterns. Until recently, China and Japan were leading the digital race as consumers in Southeast Asia were experiencing limited access to the internet and computers. Fast forward to today and nearly everyone has a mobile phone with internet access — the region saw a whopping 40 million new internet users in 2020!
This boom has opened up new opportunities for eCommerce players to attract a wider customer pool hungry for more online retail offerings. Ready to get in on the action? Here are some strategies on how to capture the Asian consumer.
Discount for first-time purchase
The beauty of online retail is it gives consumers the ability to purchase anything, anywhere, anytime — something they would not have been able to do with pure brick-and-mortar stores or sometimes, without an air ticket. Seasoned online shoppers may not hesitate when checking out their carts but first-time customers may have some second thoughts. Unfamiliarity with the site, brand or platform, or uncertainty over the entire customer experience journey are some of the top reasons for their hesitation. Seal the deal with prospective buyers by lowering the barrier to entry with discounts on your site they can redeem as first-time shoppers.
Social commerce and livestream shopping
Making the online purchase journey as simple and seamless as possible can further lower barriers to entry, especially for consumers who are not as tech savvy. Take for example, Instagram, which has evolved from a photo sharing platform to a full-fledged social networking service complete with eCommerce capabilities in the form of Instagram Shopping. Via Instagram Shopping, retailers can now use their Instagram account as a virtual storefront which allows customers to buy directly from an Instagram post. Facebook has a similar function called Facebook Shops.
In addition, these platforms (among others) also have features that enable retailers to host livestream shopping which combines social networking and entertainment with shopping. According to eMarketer, livestream shopping has been picking up steam and is projected to hit USD480 billion in China this year.
Multiple digital payment options
Credit card payment traditionally dominated digital payments but shifting consumer demands encouraged innovation in the payment getaway space, allowing customers with no credit cards the opportunity to make purchases online. These days, Cash on Delivery (COD), bank transfers, e-wallets, and even Buy Now Pay Later (BNPL) options are available on most eCommerce sites.
Optimise your customer’s payment journey by understanding their payment preferences and giving them exactly what they want. For example, a 2021 study on eCommerce trends in Southeast Asia concluded that credit card payment is more popular in Indonesia, Singapore, and Vietnam, while Malaysians prefer bank transfer and cash is still the go-to for consumers in the Philippines.
Leveraging a Key Opinion Leader’s (KOL) reach is a good opportunity for brands to target new or specific audiences and increase presence on social media. Collaborations between brands and KOLs can range from sponsored posts, new or limited product offerings bearing the influencer’s name such as Nespresso x Chiara Ferragni, and even a presentation of the KOL’s curated list of ‘must-have’ items from the brand portfolio. These can be part of a bigger shopping event leading up to Mega Sale Days, or as standalone partnerships.
Consumers are increasingly becoming savvy and according to a study conducted by Google, 96% of Southeast Asian consumers went online to research and compare before making their final purchase decision — and they also do this as early as a month before a Mega Sale Day such as a double-digit shopping event. A collaboration between a KOL could help drive awareness in the days leading up to the sale event. YouTube was also one of the preferred platforms consumers turn to when evaluating products with 82% citing that YouTube creators inspire confidence and help shorten the time they took to make their decision and speed up the purchase.
Mega Sale Days and calendar shopping events
China’s super successful Singles’ Day sale, or 11.11, has spawned a slew of shopping events across the globe and has even surpassed both Black Friday and Cyber Monday. Looking back, its first iteration in 2009 only drew a humble USD7 million, compared to 2021’s USD84.54 billion. In the same vein, localised sale events celebrating National Day and local festivals, have also gained popularity and enjoyed relative success. Enhancing this with offerings or content that appear in the consumer’s native language and current local trends can also help drive up sales.
For consumers in Southeast Asia, these Mega Sale Days make a good introduction to eCommerce. According to a survey by Meta, 43% of online shoppers indicated they shopped online for the first time during a Mega Sale Day. Southeast Asian consumers have been known to be more open to trying new brands, and data from Mega Sale Days support this — 91% said that these sale events encouraged them to buy new brands. They were also buying from categories and brands they had previously not purchased from before.
Freebies and samples galore
Who doesn’t love a freebie? Offering attractive gifts and samples is another way to secure a sale. This strategy is especially useful for brands concerned about diluting their brand value and image from offering too many monetary discounts. On top of that, it is also a great way to introduce new products (or services) to customers, without them feeling unsure about paying full price for something they are not familiar with. This is usually applied in conjunction with minimum purchase requirements, sometimes at different spending tiers (think: “the more you spend, the more you get”) to encourage customers to spend more.
Retaining customer loyalty is becoming increasingly important in a space where brands are continually competing for attention and customers are ready to move on to the next ‘new thing’. While it is understandable that brands would want to continue seeking out new target audiences, rewarding loyal customers is also a smart move. Encourage return customers by awarding them for product reviews, special members-only perks, and even a loyalty point system.
To learn more about how the Thunes payment network serves the needs of your eCommerce customers, or to add the best local or alternative payment method for Southeast Asia, explore our eCommerce sales capabilities or get in touch with our team.