Organisation:
Facebook, Bain
Resource Link:
Published in 2021, Link
My Key Takeaways
Sharing some key highlights from a report by Facebook and Bain report that could help EU/UK companies to be discovered AND trusted by more customers in Southeast Asia (SEA).
Digitalisation in Asia is already fast, but SEA’s digital consumers are outpacing regional and global markets
Since the start of the pandemic, 70M people in SEA became digital consumers – equivalent to the entire UK population!
SEA has one of the highest proportion of PE/VC investment in Tech in 1Q2021 – SEA 88% (!) vs Indonesia 52%, China 20%, and Brazil 18%.
38% of SEA respondents expect to spend more on digital services post COVID-19. Average spending per digital consumer is expected to grow 60% in 2021, increasing 1.7x to US$671 by 2026.
You can see the new SEA consumer profile after COVID-19 below (Pg 60).
“What we see in China and the US is more of a channel shift from offline to online, whereas in SEA the growth in consumer spending and retail is driven by online channels” [Magnus Ekbom, CSO, Lazada Group]
So what does this mean to my company growing in Singapore & SEA?
SEA online purchases aren’t limited to streaming, ride hailing or beauty products anymore. SEA consumers are ordering online a much wider range of goods and services that EU/UK companies can offer, among them healthcare, food delivery and fresh groceries.
This chart is a great reminder of different spending behaviours in tier 1 and tier 2 cities within the same country. Although T1 & T2 spending trends are converging, your SEA growth strategy needs to be at the city-level. [Pg 53]
37% of consumers would likely discover you on social media. 22% of respondents cite Social Media Videos as the top channel for discovery – +3x more than in 2020.
Social commerce (e.g. peer-to-peer sales platforms, conversational commerce) is gaining popularity as SEA customers want to discover AND purchase on the same platform [Pg 41-43]
Suggested services to help you build trust to sell into rural communities are: direct two-way communication (e.g. chat messenger), indication of trust by consumers’ neighbours, local stores & communities.
We all know sustainability is important to SEA customers, but how much more are they willing to pay for it?
Around 10% premium for 80% of SEA consumers, and this premium would grow in the years to come. [Pg 51 for comparison of ESG premium across SEA]
Permanent habit changes would lead to future growth for fintech, education, & telemedicine in SEA – UK/EU companies should take a deeper look at these sectors for new SEA investors & markets. [Pg 70]
Fintech corners 56% of most SEA Tech PE/VC investments in 2021 so far. [Pg 66].
Bad news that business travel would likely not bounce back (e.g. reduced budgets, proven effectiveness of work from home). Better bet for companies on leisure travel where 38% of respondents would spend more on this post Covid.
If you want customers to take the leap and pay, e-wallets are now the preferred payment option (37%) vs cash (28%), credit card (19%) & bank transfers (15%).
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I’d be really worried if I was a bank or credit card company. 🤔
My LinkedIn post here.
About Zhilin SIM
Having worked and lived in Singapore, the Nordics, China, Spain, UK, I’m now based in Paris.
I’m fluent in English, French and Mandarin, and I’m learning Arabic because it’s a beautiful and fascinating language.
My team creates and supports one-many initiatives connecting Corporate and Startup ecosystems in Europe to business and innovation opportunities in Singapore and Southeast Asia.
I’m passionate about horticulture, watercolour, startups/tech as well as French cuisine, Peranakan kueh techniques and other global cuisines.
Feel free to connect with me if you think my network in Europe and Asia could be of benefit to your business and innovation activities.
