According to an annual report by Facebook Inc and Bain & Co, the Southeast Asia region added 70 million new online shoppers since the start of the pandemic in 2020. Bulk of it came from Indonesia.
The survey which was conducted in Singapore, Malaysia, Thailand, Indonesia, Vietnam and the Philippines, showed researchers that digital adoption in the region was rapid among new consumers. Researchers are now estimating that by the end of 2021, each of those countries stated earlier to have 70% or more of its adult population as digital consumers.
In addition, the region experienced a 9% online retail penetration rate, which was higher than the online consumer penetration growth of India, China, and Brazil.
Online spending per person was at US$238 in 2020, outpaced earlier forecasts and is expected to rise to US$381 by the end of 2021. In terms of type of content, social video tripled in importance for online shopping in which 22% of respondents cited it as their top channel for discovery.
The other key finding: Online groceries was the fastest growing segments among online consumers and is expected to maintain or increase its growth by the end of 2021.
“What we see in China and the US is more of a channel shift from offline to online, whereas in Southeast Asia the growth in consumer spending and retail is driven by online channels,” Magnus Ekbom, chief strategy officer of Alibaba Group Holding Ltd’s Singapore-based unit Lazada Group SA, said in the report.
Facebook plays a key role in the growth of online consumers in the region. It is estimated that about 346 million people in Southeast Asia use Facebook on a daily basis as of second quarter of 2021. But the forecast does suggest a deceleration in the growth, as the next 30 million shoppers aren’t expected to come online until 2026.
“If we went back three years ago, Southeast Asia was still lagging,” Benjamin Joe, vice president of Southeast Asia and emerging markets at Facebook, said during a virtual briefing on Tuesday (Aug 31). “That clearly is not the case. It’s actually leading the way.”
Funding for Internet and tech startups in the region saw a growth of 88% in the first quarter of 2021, up from 75% a year earlier. Financial technology lead the sub-category with 56% of tech funding; as services such as buy-now-pay-later, digital wallets, cryptocurrency, and peer-to-peer lending becomes more popular among consumers in Southeast Asia.