Asia continues its eCommerce boom, this time fueled by a pandemic induced lockdown. Online shopping has surged in Asia as the region observed lockdown. Perhaps observing lockdown more effectively than elsewhere. East Asia is a more mature eCommerce market and is also leading innovations in mobile commerce. Like elsewhere the impacts of COVID are having a fundamental change in the region. From changes in regulation and customer trends to big ticket corporate consolidations, it has been a big three months. Here are some of the observations DigiCommerce has made in the past months.
eCommerce in Asia seems to be booming in parallel with other regions, with some similar changes in customer habits. Singapore-based Shopee for example saw a 74% increase in gross merchandise value in Q1. Shopee processed 430 million orders in Q1 2020 compared to 203 million last year. Even large real estate groups like CapitaLand, operator of Singapore’s largest mall network is launching an eCommerce platform. This platform is being designed to house the products of businesses operating in its malls. In China, an eCommerce shopping festival called Double Five raked in $2.2 billion in one day. The event was preceded by a campaign sending out online coupons and discounts by different eCommerce platforms and offline retailers. Internet penetration in China has increased 5% over the past year. Online retailers continue to take advantage by increasing their share of overall retail year over year.
Similar to elsewhere their is an ever growing appetite for omnichannel solutions and Asia shows a glimpse into the future. Mobile is the easiest available way to access the internet for billions around the world. In Hong Kong, half of eCommerce is conducted on mobile and this is set to grow 2% per annum. Philippines, arguably Asia’s leader in mobile commerce, skipped mass desktop adoption due to its lower income population. In the year preceding January 2020, mobile connection increased 38% in the country. Social media users also increased by almost 6 million people in the 9 months before January. Asian mobile commerce has found the right mix of design simplicity, security and maximizing micro-interactions.
With the rapid changes going on in the Asian market, one country is making some interesting moves. In Japan, tech firms with eCommerce capabilities will now be required to submit annual business practices reports to the Ministry of Economy, Trade and Investment. The report contains business operations and contract terms with customers. This is designed to help transparency in eCommerce, as the ministry will publish a report after consulting merchants. This report will reflect reviews conducted and the compilation of business practice reports. Companies are now obligated to give prior notice of contract changes and create ways to address customer concerns. They must also explain how they rank search results. These measure are designed to target the adverse impacts of monopolistic and predatory business tactics.
When it comes to integrating eCommerce with social media and digital payments, Asia is far ahead. Mainland China for example is 3-5 years ahead of anywhere else when it comes to influencer marketing. However, current indications are customers are weary of influencer marketing with other alternatives getting more popular. Live-streaming and video have become the go to choice for many brands in recent months. Hashtag marketing on social media is also boosting sales for many e-commerce vendors. The growing demand of mobile means Asia might be a snapshot into the future of eCommerce in less mature markets.