Retailers in Southeast Asia are increasingly focusing on social media, with 68 per cent planning to boost their investment on “social commerce” to sell more over social media in the next 12 months, according to a report last week by Shopify.
The e-commerce service provider found that social media has become the leading channel for brand and product discovery in the region, with more than 82 per cent of consumers finding new products through these platforms.
Eugene Chua, executive head of global e-commerce and sales at Secretlab, a Shopify client, noted that customers are more discerning and selective when it comes to spending due to the economic climate.
Specifically, inflation and the rising cost of living have resulted in 83 per cent of Southeast Asian consumers reducing non-essential expenses, with over half seeking the best value when they shop, according to the report by Shopify, which helps businesses create online sales websites with easy-to-use tools.
When making a purchase, the key deciding factor is price, it found. Some 96 per cent of Southeast Asian consumers surveyed claim loyalty to a brand if it offered them an incentive, with consistently low prices or promotions being a top draw for 70 per cent.
In line with this, contextual real-time pricing (71 per cent) is where retailers plan to increase their technology spending to drive conversions while maintaining favourable margins.
Online shopping preferred in Southeast Asia
About half – 52 per cent – of Southeast Asians like to shop online. A high percentage (82 per cent) think that a company with a brand website is more trustworthy and credible, compared to those without one.
This trust is important especially for shoppers making large purchases, as 42 per cent prefer to make such purchases on a company’s website instead of its online marketplace store.
Additionally, omnichannels are important as 28 per cent of Southeast Asian shoppers enjoy in-store shopping as much as online shopping, and another 19 per cent prefer in-store shopping. In line with this, 66 per cent of retailers surveyed plan to increase tech investment in a unified commerce platform.
In terms of technology, 99 per cent of retailers surveyed believe that technology will remedy their operational challenges due to manual process and complex systems. They plan to invest 20 per cent of their total revenue in innovation initiatives in the next year.
Key areas of increased investment include: contextual real-time pricing (71 per cent), social commerce (68 per cent), business intelligence (67 per cent), unified commerce platform (66 per cent), and composable stacks (65 per cent).
“In this current economic climate, the imperative for both shoppers and retailers to achieve more with less has never been greater,” said Shaun Broughton, managing director for Asia-Pacific and Japan at Shopify.
“Unified commerce is set to be a key growth catalyst, enabling retailers to harness comprehensive data and insights across their customers, inventory, and operations to make informed and strategic decisions,” he added.
Singapore shoppers ahead of the curve
For Singapore consumers, the top three online shopping priorities are free shipping (71 per cent), accessibility of payment with debit and credit cards (55 per cent), and free returns (51 per cent).
But when it comes to shopping in-store, the key considerations are knowledgeable staff (56 per cent), stock availability (55 per cent), and attentive service (36 per cent).
Notably, a separate Adyen survey of 38,000 consumers worldwide revealed that Singaporean customers are ahead in payment trends, favouring smart technologies and social media.
Compared to the global average, Singaporeans are more comfortable with self-checkouts and QR codes. Nearly 47 per cent of Singaporeans use QR codes compared to 27 per cent globally. More than half use tap-to-pay on mobile devices compared to a quarter globally.
Adyen’s report found that social commerce is also more prevalent in Singapore, with 51 per cent of consumers making purchases through social media compared to 44 per cent elsewhere. Also, 8 in 10 Singaporean retailers report increased revenue from social commerce.
Cashless payments are on the rise in Singapore, with 31 per cent choosing not to carry wallets, compared to just over a quarter globally. Singaporeans are also more receptive to emerging technologies like smart mirrors for virtual try-ons and shopping in the metaverse or through virtual reality (VR).
“Consumers want an “endless aisle” experience where they can come to a physical store when they want to with the comfort of knowing they can get what they want even if it’s not in store,” said Warren Hayashi, president of Adyen Asia-Pacific.
