E-commerce in the ASEAN region
In 2019 the ASEAN region accounted for more than 50% of global e-commerce sales, that amounts to well over 900 billion dollars. Just in Asia, this staggering market share is expected to balloon to 61% by 2024, that’s 1.9 trillion dollars within southeast Asia. This exponential growth is not limited to only B2C interactions but B2B as well as more and more businesses seek professional aid in setting up online storefronts and getting to grips with the key metrics indices and tools that come with operating on the web. (Eastspring Investments, 2020)
Why the rapid growth?
The rapid growth of the sector can be attributed to the mass adoption of mobile technologies and ease of access to the internet, given the rapid development of telecommunications infrastructure spurred by China. The proliferation of digital payment options like PayPal, Visa and more recently cryptocurrencies like bitcoin have made it easy for businesses to target and reach relevant consumers in the AEASN region. China is the best case study to grasp the concept behind the power in numbers phenomenon the internet has brought forth, between 2013-2016 mobile payments skyrocketed from 25 to 68% of mobile internet users. (Kinda, Tidiane, 2019)
COVID-19 & Its effects on E-commerce
The events of the past 3 years have also been an unforeseen push factor for the growth of the industry, the need to access both luxury and essential goods without human contact, not to mention the post COVID paradigm that has seen a rise in remote work, shortages of staff within in-person businesses like restaurants and retail outlets. Despite the difficulties these organizations have faced they have managed to rise to the occasion and adapt by embracing platforms like grocery e-commerce and delivery, beyond groceries, recreational/home goods spending increased by 18% mostly through products like gym equipment and household furnishings (Fryer, 2022)
Lazada & Shopee
Lazada and Shopee are the largest online shopping platforms in southeast Asia by traffic volumes, particularly in Malaysia, Singapore, Thailand and the Philippines. In 2019 Shopee took the title of most visited ASEAN E-commerce platform with over 2 billion visitors, however Lazada has retained the larger market share of the two, seeing a rise of 13% in visitors within the same time period (Teope, 2020).
- Currently the largest and most widely used platform in the region, with over 100 million monthly active users and 80 million annual active consumers, it is important to know that Lazadas’ parent company is Alibaba.
- They have their largest presence in Thailand and the Philippines with 36.6 million & 34.3 million monthly visits respectively.
- The Malaysian market has seen an increase to 16.7 million active users since the introduction of their payment option – Lazada wallet. That is an increase of over 30%
- The second largest platform in Southeast Asia, however it is rapidly growing and actively competing with Lazada for the same market.
- Indonesia has contributed the majority of visits for the site with over 90 million visits in the 2nd quarter of 2020
- In only 5 years Shopee has managed to become the most downloaded application, coming in 1st in Taiwan and Southeast Asia and 3rd globally in the shopping category.
- Shopee’s rapid development is down to how they established their partnerships with local wholesalers and the pre-established Chinese businesses’. In contrast to Lazadas European backed finances and marketing.
- Another factor that contributed to Shopee’s meteoric rise is their partnership with local macro-influencers/celebrities particular to all specific ASEAN countries.
(Split Dragon, 2021)
Setting up your store
How do I get a piece of the pie? This is the fundamental question at hand, and one we are fully prepared and equipped to answer!
It's really easy to start! In fact you can finish the initial setup of your Lazada/Shopee store within 15 minutes - all you need is a phone number/email address and your business/personal details!
For an in-depth step by step guide for a full store setup follow our Lazada and Shopee guides, click the link below to get detailed instructions for your set up and start earning!
Nothing holding you back!
Unlike many other industries and markets, the barriers to entry for e-commerce are few and easily surmountable, not to mention the pre-established marketplaces that are Lazada and Shopee. The way we see it is in quite a literal sense, in that we, the average Joes, all have something we find of value and are intending to sell, Lazada/Shopee have made it so that there are already eyes on the shelves you plan to place your product, whilst giving you the tools to drive even more traffic to your items.
To add to these benefits there are services provided by companies like our own (Leap) that further aid your endeavor into the digital market, with offerings like back-end management i.e. logistics CRM, marketing and store setup as well to mention a few.
The time to act is now, it has never been easier to scale your business and add entirely new markets that were previously out of reach, now only a few clicks away, take a Leap of faith and start carving out a piece of the pie for yourself!
Eastspring Investments, 2020. E-commerce: Driving Asianext leg of growth. [Online] Available at: https://www.eastspring.com/sg/insights/e-commerce-driving-asia-s-next-leg-of-growth[Accessed 12 May 2022].
Fryer, V., 2022. Understanding COVID-19's Impact on E-Commerce and Online Shopping behaviour. [Online] Available at: https://www.bigcommerce.com/blog/covid-19-ecommerce/#covid-ecommerce-trends[Accessed 12 May 2022].
Kinda, Tidiane, 2019. E-commerce as a Potential New Engine for Growth in Asia. IMF Working Paper, - July, p. 19.
Split Dragon, 2021. Lazada vs. Shopee Perforrmance: Who's winning in Asia?. [Online] Available at: https://blog.splitdragon.com/lazada-vs-shopee-performance-whos-winning-in-asia/[Accessed 12 May 2022].
Teope, S., 2020. Lazada and Shopee are the two most used e-commerece apps in Southeast Asia. [Online] Available at: https://sbr.com/retail/news/lazada-shopee-are-two-most-used-e-commerce-apps-in-southeast-asia[Accessed 12 May 2022].