The COVID-19 pandemic has changed the way the world operates. We have had to adapt and change how we do everything, and it looks like not all of that change will be temporary. In Southeast Asia, particularly, online shopping trends have changed dramatically and will likely never go completely back to how they were before the start of this year. Though we hope most of the changes we are experiencing during this pandemic are temporary, we will definitely be seeing a lasting impact of COVID-19 on online shopping in Southeast Asia.
According to a 2019 report by Facebook and Bain, Southeast Asia was already on a forward trajectory of digital consumers with the amount of digital spending almost tripling between 2015 and 2018. Expectations were that this number would continue to grow to 310 million consumers by 2025, but it appears that the Coronavirus has sped things along. A more recent report identifies six themes that have been unfolding across the consumer market as online engagement has increased in the region.
Shopping for essential goods
While online shopping is nothing new to many consumers in the area, Bain and Facebook’s report noted that the grocery market was an area of “untapped opportunity” for growth. Almost half of the eCommerce customers surveyed have significantly increased their online spending regarding groceries and other essential items, and over 80% of them plan to continue doing so in the future. Online shopping for groceries, household and personal goods was already accessible but not as widely used as going into the store was not a huge hassle—until now. But as people become more accustomed to it, it will grow in popularity due to the convenience and this newly-established habit.
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With most people spending more time at home, new forms of entertainment, avenues for social interaction, and ways to maintain work productivity have become essential. This new way of living brings a need for a new set of ‘”tools” to function effectively, leading to a rising rate of new app discovery. According to the report previously mentioned, 77% of consumers in Southeast Asia have successfully tried at least one new app and plan to continue using it in the future. The most common apps people are trying are social media, video streaming, and eCommerce related. This trend has been significant for the expansion and diversification of apps, helping boost app developers’ success and increase online revenue.
Value for money
The pandemic brought financial uncertainty and job losses for many. People switched from spending on luxury items to survival needs, placing a higher emphasis on frugality and practicality. Over half of digital consumers in Southeast Asia have added concerns on value for money to their consideration when online shopping.
Well-established and trusted brands
Previously, consumers in the region had little problem with trying new and unestablished brands. It didn’t seem to matter what brand they purchased and it appeared many preferred smaller, lesser-known brands. Throughout the pandemic, this has begun to change, and there has been a noticeable shift towards bigger, more well-known brands. This change is likely due to the assumption that larger brands will be more stable with regards to shipping, supplies and quality, giving peace of mind that the products will be reliable. Mid-pandemic is not the time to be experimenting with new products.
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More consciousness in consumer activity
The swift rise and spread of this pandemic have made us more aware of the health of our planet, ourselves and others. This enlightenment is making people more conscious of their shopping and spending, and they are gravitating towards wellness, environmentally friendly and sustainable options. People have also become more aware of the need to look out for each other and our communities, resulting in more consumers intentionally supporting smaller, local businesses to try help sustain and maintain them through this difficult time.
Increased ‘at home’ and contactless activity
Maintaining “normal” activity while staying as safe as possible, has seen the market developing new ways to distribute goods and interact without close-range physical contact. As people strive to find ways to pay for and receive goods without putting themselves and others at risk, they have started relying more on contactless delivery and payment options. Businesses have had to add contactless options to their services, and the use of ePayment options such as GrabPay has significantly increased.
Surprisingly, the impact of COVID-19 on online shopping in Southeast Asia has been very positive and offers economic hope in these dark times. It appears eCommerce in the ASEAN region received an extra boost and a chance to increase their market share, and this is unlikely to be just temporary. Indeed, these online shopping trends appear here to stay, even as bricks and mortar shops and everything else slowly starts to shift back to normal.