Spanning 11 countries and composing 8.58 percent of the world’s population, Southeast Asia has grown into a force to be reckoned with when it comes to retail and e-commerce. From 2015 to 2021, the region’s e-commerce market value ballooned from USD 5.5 billion to USD 100 billion, making Southeast Asia a space to watch.
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A new industry report by Global Fashion Group and Zalora, the ‘Southeast Asia Trender Report’ outlines key takeaways on consumers from Singapore, Malaysia, Indonesia, Vietnam, the Philippines, Thailand, and more.
In a growing digital economy, e-commerce continues to gain momentum
According to the report, three of the world’s top 10 heavy internet users reside in Southeast Asia: the Philippines (averaging nine hours and 58 minutes), Thailand (eight hours and 37 minutes), and Malaysia (eight hours and 36 minutes). As expected, a growing digital footprint means communities are becoming ever more sophisticated in the region. The region’s digital economy approached USD 200 billion GMV in 2022—three years earlier than previous estimations. Southeast Asia shoppers are also embracing the hype when it comes to online shopping festivals. What started as a celebration in China—Single’s Day, or 11.11—has become a retail sensation in countries throughout Southeast Asia. In 2022, mega campaign days by Zalora drew six-times the sales of a typical day, birthing the rise of annual shopping days.
When they’re not shopping online, they’re shopping at the mall
An irreplaceable establishment for many Southeast Asians, shopping malls are often the centre for leisure activities. More than a haven for retail, malls have become a go-to for outings and events whether alone or with family or groups of friends. In Malaysia, for example, searches for malls pre-pandemic peaked at 87 percent, according to Google Trends. Boutique retail is also finding footing in places like Bangkok and Kuala Lumpur, where concept stores and niche commercial spaces offer a refreshing alternative to crowded shopping centres. The physical experience remains a key quality for success, and unique retail encounters can be a major plus.
Wellness has become top of mind
Emerging from the pandemic, Southeast Asian consumers continue to prioritise “self-care,” with wellness products such as candles and surgical masks peaking substantially in 2021 before tapering to average levels in 2022. Sports electronics enjoyed a positive growth of 15 per cent from 2021 to 2022. According to the report, consumers across ages started investing in fit-tech wearable devices as mobility restrictions across the markets eased gradually. Shoppers from Indonesia and the Philippines, in particular, have become the biggest spenders of Zalora’s wellness category, with Gen X shoppers over the age of 40 spending the most, thanks in part to their increased digital literacy, followed closely by millennials aged 25 to 30.
Sustainability is on the rise
According to a Bain & Company report, Southeast Asia’s fast-growth markets—Thailand, Malaysia, Indonesia, the Philippines and Vietnam—were more conscious of environmental and social factors than those in more mature markets such as Singapore.
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In part due to this, the resale industry, estimated between USD 100 billion to 120 billion, has seen a boom in recent years, giving rise to recommerce platforms founded in Asia. The growth of Zalora’s pre-loved item segment, offering secondhand clothing and accessories, has also risen nearly 70 percent, led by purchases from millennial and Gen Z shoppers.