Top 9 E-commerce Trends to Watch in Southeast Asia for 2024

Top 9 E Commerce Trends To Watch In Southeast Asia For 2024

Southeast Asia (SEA) is a booming powerhouse of digital advancement and commerce, with the online marketplace sector rapidly expanding and evolving. This dynamic region is made up of 11 countries, with six of them leading the region economically: Indonesia, Thailand, Malaysia, Singapore, the Philippines, and Vietnam. As we approach 2024, several major trends will shape the future of e-commerce in Southeast Asia. Let's look at the key trends fueling Southeast Asia's online marketplace expansion, as well as some of the market's biggest participants.

Social Commerce and Live Selling

Live selling has experienced significant growth on platforms such as TikTok, becoming a dynamic component of social commerce. According to TikTok Newsroom, a significant number of individuals, approximately 325 million, are active users of TikTok in Southeast Asia on a monthly basis. Additionally, a considerable number of businesses, around 15 million, have chosen to utilise the platform. TikTok has experienced a surge in live selling events, with a significant rise in participation in Thailand and the Philippines in just the past year. This trend highlights a significant change in consumer behaviour, as shoppers actively interact with brands and influencers in real-time to explore new products and make well-informed purchasing choices.

Tiktok Tb

Meanwhile, Shopee Live is experiencing significant growth in Malaysia. Shopee Live is an exciting live-streaming platform offered on the Shopee app, where consumers can enjoy watching engaging product-related content and interact directly with sellers. The impact on economic empowerment is clear. In 2023, a significant number of vendors experienced a remarkable 25% increase in their earnings year on year. Additionally, there was a substantial surge in both affiliate and live-stream orders, with a staggering 420% and 500% increase, respectively, in Malaysia alone, as reported by TheStar.

Shopee Live

Expansion of Cross-Border E-commerce

Cross-border e-commerce in Southeast Asia has grown significantly, owing to increased consumer interest in international brands and products. Marketplaces are quickly adjusting to this trend, improving their logistics, payment systems, and customer support services to ensure successful cross-border transactions. Ninja Direct stands out among these markets as a major participant, supplying a comprehensive choice of global products to Southeast Asian customers.


Ninja Direct has made significant investments in developing a robust logistics network to ensure that products are delivered on time across borders. Furthermore, the platform offers a variety of payment alternatives adapted to the needs of different customer categories, increasing simplicity and accessibility. Ninja Direct's multilingual customer service responds quickly to any questions or problems, resulting in a more seamless purchase experience for users.


This expansion of cross-border e-commerce not only broadens the range of products available to Southeast Asian buyers, but it also assists local businesses in entering new markets, promoting regional economic growth. With platforms like Ninja Direct, Southeast Asia is rapidly evolving into a growing international trade hub. This allows customers to easily connect with global companies, opening up a world of possibilities and making a wide range of items more accessible to everyone.

Ninja Direct

The Adoption of Augmented Reality (AR) in Online Marketplace

Augmented Reality (AR) is currently growing as a key trend in Southeast Asia's online markets, owing to technology improvements and shifting consumer tastes. The use of augmented reality technology is transforming the shopping experience by providing immersive and interactive elements that dramatically increase customer engagement. For example, big companies such as IKEA have used AR to enable buyers to visualise furniture in their homes, resulting in more informed purchasing decisions.

Ikea Ar

Similarly, cosmetic brands like Watsons, Maybelline, and L'Oreal are using augmented reality for virtual try-ons, allowing customers to preview how makeup products would look on them without having to apply them physically.

Maybelline Beauty App Microsoft Teams

Statista predicts that the worldwide AR retail industry will increase from $1.5 billion in 2021 to $12.2 billion by 2028, showing growing adoption and investment in AR technology. These technologies not only improve the shopping experience, but they also generate major business benefits. According to a Harvard Business Review study, businesses who use augmented reality for product visualisation saw a 19% increase in customer engagement and a 15% rise in conversion rates. AR's accessibility through current smartphones is accelerating its mainstream adoption. As technology advances, AR's importance in e-commerce is projected to grow, cementing its status as a major trend. Platforms such as Lazada and Shopee are including AR capabilities, realising its potential to attract and retain customers in a competitive market. AR is becoming increasingly important in determining the future of online purchasing in Southeast Asia, with companies from all sectors benefiting from this new technology.

Integration of AI and Personalization

Artificial intelligence (AI) is transforming online marketplaces in the Southeast Asian (SEA) industry, leading to increased efficiency and customisation. Leading e-commerce platforms such as Shopee, Lazada and Zalora employ artificial intelligence algorithms to provide tailored product suggestions, resulting in a significant boost in sales of up to 30%. In addition, customer service is being transformed by AI-driven chatbots and virtual assistants, which automate interactions and problem-solving. Forecasts predict that AI will handle 95% of customer contacts by 2025, leading to substantial reductions in operational expenses.

Zalora

In addition, artificial intelligence enhances the efforts to detect and prevent fraud, resulting in an expected cost savings of $22 billion for enterprises by 2023, achieved through the swift identification and mitigation of fraudulent actions. These systems examine transaction data and user behaviour, guaranteeing secure transactions for both buyers and sellers. With the help of AI-powered search engines and targeted advertising campaigns, the retail industry is poised for impressive growth in the field of SEA AI. This will create better experiences and opportunities for businesses and consumers in the region.

The Rise of Affiliate Marketing in SEA's Digital Landscape

Affiliate marketing is rapidly gaining traction in Southeast Asia's online marketplaces due to several key factors. The region's booming e-commerce sector, led by platforms like Shopee, TikTok Shop and Lazada, provides fertile ground for affiliate programs, offering brands a performance-based strategy to expand their reach and boost sales without hefty upfront investments. In a recent blog post on SellerCraft, the continued relevance of affiliate marketing in e-commerce for 2024 is explored in-depth, shedding light on its adaptive nature amidst evolving business trends. Dive into the insights here: (Business Trends: How Affiliate Marketing Still Fits into E-commerce in 2024)

Shopee Affiliate Program

With Southeast Asia's high mobile internet usage rates and increasing consumer demand, particularly post-pandemic, affiliate marketing emerges as a strategic tool for brands to tap into this growing market efficiently. As noted by impact.com, success stories from local brands like Love, Bonito in Malaysia further validate the effectiveness of affiliate marketing, while the widespread adoption of diverse digital payment methods facilitates seamless transactions within affiliate programs. Overall, the integration of affiliate marketing into broader digital strategies is proving pivotal for brands in Southeast Asia, enabling them to enhance visibility and drive sales cost-effectively amidst the region's evolving digital landscape.

Enhanced Payment Solutions

Fintech innovations are driving major shifts in digital payments. In Southeast Asia, where smartphones are widely used, the digital payment landscape is rapidly evolving. Mobile wallets, such as GrabPay and GoPay, are gaining significant popularity, with Statista forecasting that mobile wallet transaction value in Southeast Asia would reach $258 billion by 2025.


Furthermore, the rise of buy now, pay later (BNPL) services is changing how customers shop online. As reported by GlobalData.com, the Buy Now Pay Later (BNPL) market will be worth $309.2 billion in 2023 and is predicted to develop at a compound annual growth rate (CAGR) of 25.5% during the forecast period. Online payments are fast increasing as more consumers take advantage of online buying, which benefits BNPL market growth. Over the previous few years, BNPL has gained popularity as an alternative credit option, and this trend is projected to continue during the forecast period. The payment mechanism has become popular among Generation Z and Millennials.


Fintech technologies such as mobile wallets and buy now, pay later (BNPL) services are not only improving the convenience and accessibility of online buying, but also accelerating the growth of e-commerce, particularly in growing regions such as Southeast Asia. In addition to popular mobile wallets like GrabPay and GoPay, platforms like Shopee have launched their own SPayLater service, and TikTok Shop works with Atome to enable BNPL payments.

Spay Later

These efforts give consumers more choice and control over their payment methods, solving the limitations posed by traditional banking infrastructure in the region. As a result, the widespread availability of mobile wallets and BNPL choices is generating significant growth in online transactions, moving Southeast Asia's e-commerce sector ahead.

Buy Online, Pick Up In Store (BOPIS)

Buy Online, Pick Up In Store (BOPIS) is a hybrid retail approach that is becoming increasingly popular, particularly in the aftermath of the COVID-19 pandemic. This method enables customers to buy purchases online and pick them up at physical store locations, combining the convenience of e-commerce with the quickness of in-store pickup. BOPIS is becoming increasingly popular internationally. In November 2022, approximately 8% of all online orders were picked up in-store.


According to Statista.com, by October 2023, the figure had risen to ten percent. BOPIS was at its peak in September 2023, during the survey period. It accounted for more than 11% of total online orders.

Bopis

Source by Statista: Monthly share of e-commerce orders bought online and picked up in store (BOPIS) worldwide from November 2022 to October 2023

IKEA, the Swedish furniture giant, has launched BOPIS services in some Southeast Asian areas, allowing customers to order furniture and home goods online and pick them up at IKEA shops. GrabMart, as an extension of the Grab app's services, also provides BOPIS capabilities for groceries, basics, and other things, allowing users to order online and pick up their purchases at certain locations.


Shopee and Lazada also provide in-store pick-up services, albeit currently available for selected sellers and products.

Lazada In Store Pick Up

These platforms are gradually expanding their BOPIS offerings to cater to the growing demand for flexible shopping options among consumers in the region. This trend aligns with customers' preferences for flexibility and speed in their shopping journeys. As retailers continue to optimize their omnichannel strategies, BOPIS is poised to remain a crucial component, driving both online sales and foot traffic to brick-and-mortar stores.

Conclusion

In Southeast Asia (SEA), the digital marketplace landscape is dynamic and rapidly evolving, fueled by robust economic growth and technological innovation. As we enter 2024, several key trends are shaping the future of e-commerce in the region. Live selling, exemplified by platforms like TikTok and Shopee Live, has gained significant traction, offering consumers interactive shopping experiences and empowering vendors with increased sales opportunities. Cross-border e-commerce is also on the rise, driven by growing consumer interest in international brands and facilitated by platforms like NinjaDirect, which provide seamless logistics and payment solutions for cross-border transactions.


Additionally, the adoption of augmented reality (AR) and artificial intelligence (AI) is revolutionizing online shopping experiences, enhancing customer engagement and personalization. Brands are leveraging AR for immersive product experiences, while AI-driven algorithms are optimizing product recommendations and customer service interactions. Affiliate marketing and innovative payment solutions further enrich the digital landscape, enabling brands to expand their reach and cater to diverse consumer preferences. Furthermore, the emergence of Buy Online, Pick Up In Store (BOPIS) services underscores the importance of omnichannel retail, offering customers the convenience of online shopping coupled with the immediacy of in-store pickup. With major market players like IKEA, GrabMart, Shopee, and Lazada embracing BOPIS, this hybrid model is poised to drive continued growth in e-commerce across Southeast Asia, fostering a more seamless and integrated shopping experience for consumers.