Southeast Asia’s Online Retail Outlook (2025–2026)
Southeast Asia’s online retail market is set for strong growth through 2025–2026, driven by social commerce, cross-border expansion, and technology adoption—but success will hinge on efficiency and local strategy.

Southeast Asia’s digital economy is entering a new era of scale, innovation, and competition. The Digital 2025 Global Overview Report paints a clear picture of an accelerating region — one where more consumers are connected, mobile-first, and increasingly reliant on online channels for everything from essentials to luxury goods. With a collective population exceeding 680 million and growing digital adoption, the region’s e-commerce transformation represents one of the most significant shifts in global retail. For businesses, the message is simple: adapt fast, localize deeply, and act boldly.
This comprehensive analysis expands on the evolving digital retail environment in Malaysia, Singapore, and Indonesia — the region’s three most dynamic markets. It dives deeper into category-specific trends, consumer behavior, and practical strategies for companies looking to sustain growth through 2025 and 2026.
The Regional Snapshot
Southeast Asia’s e-commerce landscape continues to mature. Consumers are spending more time online, social media is shaping purchase decisions, and digital payments are now the default. Yet, offline retail remains powerful, emphasizing the region’s unique hybrid model.
- E-commerce GMV: Expected to reach US$230 billion by 2026, nearly doubling since 2021.
- Mobile commerce: Over 90% of online transactions are completed through smartphones.
- Malaysia: E-commerce is projected to reach US$23.5 billion by 2027, driven by strong adoption of food, beauty, and electronics.
- Singapore: Home to SEA’s highest online spending per capita — over US$1,200 per shopper annually — and leading cross-border trade.
- Indonesia: The powerhouse, already at US$75 billion GMV, growing at an average of 19% per year.
While digital spending is booming, offline retail still captures 80–85% of sales, especially in grocery, fashion, and home improvement. For businesses, this dual reality underscores the importance of omnichannel strategies that merge digital convenience with physical trust.
Key insight: SEA consumers research online before buying in-store — and vice versa. The ability to bridge those touchpoints defines competitive advantage.
- Electronics & Gadgets
The electronics sector remains the foundation of Southeast Asia’s e-commerce expansion. From smartphones to smart home devices, consumers are driven by aspiration, affordability, and access.
- Category share: Electronics account for roughly 20–30% of total e-commerce GMV across major SEA markets.
- Top brands: Samsung, Apple, OPPO, Vivo, and Xiaomi dominate, while mid-tier Chinese brands like Realme continue to grow rapidly.
- Cross-border trends: Buyers in Malaysia and Indonesia often source premium electronics from Singaporean retailers for better warranty and reliability.
Why it matters: With short product lifecycles and high average order values, this category thrives on trust and speed. Fast after-sales service, transparent pricing, and installment payment plans are key differentiators.
Emerging opportunity: The rise of refurbished and eco-certified electronics is capturing value-conscious, sustainability-minded consumers.
- Fashion & Apparel
Fashion reflects the diversity of Southeast Asia’s culture and economy. It’s a space where local craftsmanship meets digital creativity.
- Indonesia: Fashion leads with 16% of e-commerce sales, fueled by modest wear and seasonal promotions during Ramadan and Eid.
- Malaysia: Modest fashion is booming, with 42% of Shopee’s apparel sales during festive seasons tied to Muslim wear.
- Singapore: Shoppers blend high-street and designer brands, with cross-border purchases from Zalora, ASOS, and Shein.
Why it matters: Fashion in SEA is heavily driven by social commerce. TikTok Shop, Instagram, and Facebook Live have turned shopping into entertainment. Conversion rates through livestreams are 2–3x higher than static listings.
Local icons: Love, Bonito (Singapore), Naelofar (Malaysia), and Buttonscarves (Indonesia) exemplify how regional brands thrive by fusing authenticity, inclusivity, and digital storytelling.
Trend to watch: Circular fashion is emerging fast, led by resale platforms like Carousell, which enable sustainable consumption for Gen Z.
- Health & Beauty
Once viewed as a niche, health and beauty now represent lifestyle essentials. Southeast Asians are prioritizing wellness and appearance at record levels.
- Indonesia: Health & beauty makes up 14% of e-commerce GMV, driven by affordable skincare and halal beauty.
- Malaysia: 62% of digital shoppers buy personal care products monthly.
- Singapore: The beauty segment, including skincare and supplements, accounts for almost half of Shopee Singapore’s top-selling items.
Local leaders: Wardah (Indonesia) and Safi (Malaysia) dominate with culturally aligned, halal-certified lines.
Global favorites: L’Oréal, The Ordinary, and Innisfree maintain strong urban followings.
Why it matters: Personalization, authenticity, and education drive engagement. Beauty livestreams, skincare tutorials, and user reviews influence over 70% of purchase decisions in this category.
Trend to watch: Subscription models for vitamins, supplements, and skincare refills are gaining traction among urban millennials.
- Groceries & Essentials
The pandemic permanently changed grocery habits in SEA, unlocking new digital behavior among urban families.
- Growth rate: Online grocery in SEA has seen a compound growth rate of 97% since 2020.
- Market leaders: GrabMart, Foodpanda, and HappyFresh dominate city deliveries, while supermarket chains like FairPrice (Singapore) and Lotus’s (Malaysia) bridge online and offline.
- Indonesia: Services like Sayurbox and Blibli Mart are expanding beyond Greater Jakarta.
Why it matters: Convenience defines the customer experience. Loyalty programs, same-day delivery, and freshness guarantees are becoming standard expectations.
Emerging subtrend: Specialty categories — organic produce, halal groceries, and pet food — are showing rapid digital uptake.
- Home & Living
Home improvement and lifestyle spending are surging, powered by rising middle-class incomes and flexible work arrangements.
- Category share: Roughly 10–12% of SEA’s e-commerce spending.
- Top players: IKEA Southeast Asia, Courts, and Castlery are expanding hybrid store models.
- Consumer shift: Families invest more in comfort-driven furniture, smart appliances, and home décor.
Why it matters: Southeast Asians are spending more time at home and expect seamless online-to-delivery journeys. Brands providing AR previews, detailed specs, and post-purchase assembly services see stronger conversion.
Example: Castlery (Singapore) leverages AR technology and localized logistics to ensure fast delivery across major cities.
Trend to watch: Sustainability in furniture manufacturing and upcycling are gaining attention among eco-conscious urban dwellers.
- Toys, Baby & Hobbies
Young demographics and family-oriented culture make this a resilient growth category.
- Malaysia: Toys & hobbies = 12% of total e-commerce value.
- Indonesia: Baby essentials (formula, diapers) and hobby goods are consistent bestsellers.
- Singapore: Pet care and educational toys are growing, supported by brands like Mothercare Singapore and Pet Lovers Centre.
Why it matters: This category thrives on trust, safety, and emotional connection. Parenting content and community groups are powerful conversion tools.
Emerging sub-niche: Gaming peripherals, creative crafts, and collectible merchandise are driving engagement among young adults.
Consumer Behavior Shifts
- Mobile-first consumption: SEA consumers spend an average of 8 hours daily online, with 3–4 hours on mobile commerce or social apps.
- Social commerce boom: TikTok Shop, Instagram Live, and Facebook Marketplace are expected to represent 25–30% of SEA’s online GMV by 2026.
- Price versus experience: While discounts remain important, quality and convenience increasingly influence retention.
- Digital wallets everywhere: GrabPay, TnG eWallet, Dana, OVO, and PayNow are driving cashless transactions. QR code adoption exceeds 80% in urban centers.
- Trust and authenticity: Verified badges, secure payment gateways, and transparent delivery tracking are critical confidence builders.
Challenges & Opportunities Ahead
- Overcrowded marketplaces: Low-cost imports via Temu and AliExpress create margin pressure. Local sellers must compete through service and branding.
- Rural reach: Delivery outside Tier 1 cities remains costly, slowing penetration in emerging markets.
- Skills shortage: Demand for digital marketing, logistics, and data analytics talent outpaces supply.
- Consumer fatigue: Constant mega-sale events risk diluting impact — brands must innovate with storytelling and value-added loyalty programs.
Opportunity insight: Regional collaboration is the next frontier. Malaysian SMEs using Singaporean logistics hubs or Indonesian manufacturers exporting via Shopee and Lazada are unlocking new efficiencies.
Strategic Roadmap for Businesses
- Adopt Omnichannel Models: Seamlessly merge physical stores with digital experiences — enable buy-online-pickup-in-store (BOPIS), unified loyalty, and cross-channel customer service.
- Leverage Local Holidays: Localize campaigns for Ramadan, Chinese New Year, Hari Raya, and the Great Singapore Sale to capture cultural moments.
- Invest in Speed: Optimize supply chains with regional 3PL partners such as Ninja Van, J&T Express, and SiCepat.
- Own the Social Space: Create live-selling strategies, influencer partnerships, and community engagement initiatives.
- Data-Driven Personalization: Use analytics to segment audiences and predict purchase behavior.
- Sustainability Storytelling: Showcase eco-initiatives in packaging, logistics, or sourcing to appeal to Gen Z consumers.
- Cross-Border Integration: Use Singapore as a fulfillment gateway to scale across Malaysia and Indonesia efficiently.
Final Word
The Digital 2025 report confirms that SEA’s consumer markets are diversifying quickly, with six categories dominating growth: electronics, fashion, health & beauty, groceries, home & living, and toys/baby/hobbies. Businesses that adapt early, invest in trust, and deliver seamless omnichannel experiences will thrive in Malaysia, Singapore, and Indonesia.
For busy leaders, the takeaway is simple: watch these categories, prepare for digital-first buyers, and adapt strategies to local cycles. Companies that move fast, personalize engagement, and modernize logistics will capture the next wave of growth in Southeast Asia’s dynamic retail economy. The winners will not only follow the trends but actively shape them by aligning with consumer needs, cultural habits, and digital-first lifestyles.
Ready to expand in Southeast Asia? Engage with Sellercraft for brand market entry consultation and let us help you capture growth with clarity and control.