Three important steps brands must take to unlock the next stage of e-commerce growth in Southeast Asia

2021 is shaping up to be a pivotal year for brands in Southeast Asia. Last year, we saw a clear shift to digital as businesses adapted to the needs of a digital first world.

If 2020 was all about adaptation, 2021 will be a year of acceleration and evolution. Our region’s e-commerce is set to hit US$172 billion by 2025 and brands must act fast to unlock this growth. 

In our conversations with our brand partners, we found that there are 3 key approaches that brands must take as they plan for the year ahead and beyond.

1) Reach new and first-time online shoppers

While e-commerce has made big strides in Southeast Asia, we’re just scratching the surface of its potential. Today, online retail accounts for less than 5% of all retail sales in Southeast Asia, but the region’s e-commerce is also growing the fastest, outpacing China, the US and India. 

This is powered by more people coming online and a general uplift in livelihoods and incomes. Millions of people in SEA went online for the first time in 2020, many from non-metropolitan areas. In the years ahead, these smaller cities will represent one of the biggest growth opportunities as e-commerce adoption and online consumption increase. 

We are already seeing this on Shopee, with areas like West Java in Indonesia and Nonthaburi in Thailand seeing some of the greatest growth in orders during our year-end shopping events.

In 2021, we are expanding our warehouse footprint and enhancing our Shopee Xpress fleet all across the region. This will help brands reach more customers no matter where they are.

As consumers become more accustomed to e-commerce, new segments will emerge as people expect to find and buy everything they need online. Two key growth areas we expect are groceries, as well as premium and luxury items. Therefore, we are stepping up efforts to reinvent Shopee Mart and strengthen the Shopee Premium experience to help brands serve these needs.

Our Shopee Xpress team preparing parcels for delivery

2) Engage and retain customers in a crowded landscape

A glimpse of our improved Marketing Solutions for brands in 2021

As brands continue to transition online, many will enjoy an early surge in traffic and sales. But many Southeast Asians switch brands when shopping online, often in search of value and reliability.

A big reason is because mobile shopping is creating new habits. With shopping apps just a tap away, consumers are searching for new ideas, new products, and better deals more often than before. In addition, consumers in Southeast Asia are also avid window shoppers, with many not knowing what they want when browsing online.

To keep up with these new needs, brands must do more than offer the occasional sale to build loyalty. Instead, they must continuously provide value, anticipate needs, and excite customers to keep them coming back. 

We help brands be constantly top of mind among consumers. Last year, orders on Shopee Mall surged 3 times across our year-end shopping events, while we held over 600 Super Brand Days with partners throughout the year.

We’re also continually enhancing our ecosystem to help brands engage shoppers, such as with Shopee Live, or build loyalty through our new Brand Membership programme. Our AI-powered recommendations also help bring brands closer to the right customers when they need them, making repeat purchases more convenient.

3) Break new grounds via innovation and collaboration

Our discussion with HP, Philips, Procter & Gamble and Unilever POND’S at Shopee Brands Summit 2021

Finally, we believe brands should not limit themselves when it comes to e-commerce. This is especially shaped by the rise of a young and connected generation whose habits are reshaping retail. They are giving new meaning to mobile shopping; using their smartphones to discover products, consume content, compare prices, share shopping carts with friends, and more.

This belief has guided Shopee Mall since its creation in 2017. More than a virtual mall, we see it as a space for Shopee to create one-of-a-kind experiences with our brand partners.

POND’s Skin Advisor Line (SAL) AR tool on Shopee

Recently, Unilever POND’S integrated their Skin Advisor Live (SAL) AI-powered chatbot on Shopee. It allowed users to speak to SAL on the Unilever Official Store, identify skin issues with a selfie, and shop for personalised products on the Unilever Official Store, all through the Shopee app. It was a new and useful tool for many of our users and together, we drove 2 times more conversions for Unilever POND’S.

We have also collaborated with other leading brands such as L’Oreal, La Roche-Posay, P&G, and more to roll out exciting initiatives that inspire shoppers across our region. 

At our Brands Summit last week, I had the chance to sit with our partners to discuss new ideas for 2021 and beyond. There is still so much we can do together to capture the opportunities of the future and I’m glad we were able to share our thoughts and discuss how we can all move forward. 

This is an exciting time for brands in the region. SEA consumers are diverse, young and tech-savvy, pushing companies to adapt and innovate more quickly.

No matter where you are in your digital journey, I believe there is room for all of us to succeed.

Chris