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Analyzing Southeast Asia’s Online Shopping Behavior

Acquiring traffic through social media and paid advertisements are not as effective as direct traffic and organic searches

Photo by Brooke Cagle on Unsplash

In recent years, Southeast Asia’s digital economy has been growing and shifting. According to Accenture, Southeast Asia’s share of digital commerce will exceed $30 billion in the next two years. This means that Southeast Asians are now discovering the different avenues of online shopping. It’s at the cusp of peaking in online economic growth. 

Recognizing this shift, iPrice Group, in collaboration with App Annie and SimilarWeb, put together a Yearend Report (2019), which provides us vital insights on Southeast Asia’s online shopping behavior. Here are 5 interesting insights from the report: 

E-commerce sites mostly acquired traffic directly and through organic searches

Although there is a growing trend of SEA consumers accessing the Internet through mobile, it doesn’t mean that shopping through the desktop’s browser is becoming obsolete. Accenture is expecting 480 million Internet users in 2020 and ASEAN UP recorded about 350.6 million Internet users in 2018.  iPrice and SimilarWeb wanted to review how web traffic in e-commerce sites is acquired, so they analyzed the 4th quarter of 2019, when e-commerce sites acquired the most web traffic, and broke it down into 5 categories: direct, organic, paid, social, and others.

According to the data, brand strength is concluded to be important for e-commerce companies when acquiring web traffic because an average of 48% of web visits are acquired directly. Moreover, E-commerce sites acquired traffic from organic searches by an average of 38%, indicating that Search Engine Optimization (SEO) also plays a huge role in how e-commerce companies garner their userbase.  

Interestingly enough, however, the Philippines, Vietnam, Indonesia, and Thailand’s e-commerce sites acquire traffic mostly through direct traffic (by typing it on their browser’s URL), while the more mature countries, like Singapore and Malaysia’s e-commerce, acquire traffic mostly through organic searches (by typing it in search engines or accessing through other entities such as clicking links in an article). Acquiring traffic through social media and paid advertisements are not as effective as direct traffic and organic searches in Southeast Asia.

SEA consumers spend minutes a day on E-commerce sites

We’ve heard about how Southeast Asians spend hours on the Internet a day. However, how much of their time is spent on shopping online? According to the report, SEA consumers spend about 7-12 minutes on E-commerce sites a day. That’s 7-12 minutes of shopping a day! 

The Philippines has the third longest visit duration, spending about 10 minutes on E-commerce sites, while Thailand leads in the average visit duration, spending about 12 minutes a day, followed by Indonesia with 11 minutes a day. Vietnam spends the least time on E-commerce sites with just about 7 minutes a day. 

Shoppertainment and consumer loyalty drive usage of mobile apps 

Accenture mentioned that one of ASEAN’s key drivers of digital commerce’s growth is attributed to the growing mobile connections in Southeast Asia. They projected 800 million mobile connections in 2020. Therefore, it’s not enough to attract consumers through the web since a lot of SEA consumers now shop on their mobile phones. It is vital to develop and enhance e-commerce mobile apps to keep SEA consumers engaged. 

iPrice Group and App Annie analyzed the top 10 most used mobile e-commerce apps in Southeast Asia and the Philippines. In both the region and the country, the ranking of the most used e-commerce apps shows clear stability throughout the year; it indicates strong consumer loyalty.

The top 5 most used e-commerce retained their top spots in Southeast Asia. In the Philippines, Lazada, Shopee, Zalora, Amazon, AliExpress, and homegrown site, BeautyMNL, reigned as the top 6 most used e-commerce mobile apps for the entire 2019. Despite having new entrants with a high number of downloads, consumers still keep engaging with the current apps. This indicates the importance of having a strong mobile app for any e-commerce company.

The report also recognized how strong mobile apps utilized “Shoppertainment.” It is now a new competition among e-commerce apps, wherein they utilize mobile entertainment to drive sales or traffic. For example, Lazada introduced a quiz game, “Guess It!”, on its app, while Shopee launched the Shopee Live Festival in 6 countries. Indonesian site, Tokopedia, collaborated with Kpop sensation, BTS, for promotional activities, while Tiki and Sendo launched their own livestream app features in Vietnam. All these Shoppertainment efforts reaped benefits as it helped keep these apps in top spots. 

There is a surge in consumer spending during online sales  

Data reveals that there was an increase in consumer spending by an average of 56% on big online sales events compared to an ordinary day in 2019. SEA consumers are definitely more likely to spend during big sales periods. These sales deem to be effective just as how physical sales used to bring crowds of people into malls. 

In the entire Southeast Asia, average amount spent on Singles’ Day (11.11) was US$47 (Php2,375), which is 74% higher than the average of an ordinary day, while the average amount spent on 12.12 was US$44 (Php2,223), which is 63% higher than the average of an ordinary day. Notably, SEA consumers spent the most on Singles’ Day (11.11) more than any other day.

It is interesting to note, however, that Filipinos spent 25% more on 12.12 than Singles’ Day (11.11), indicating how big the Christmas season is in the country. Therefore, Filipinos spent the most on 12.12 than any other online sale or ordinary day. This may imply that Filipinos are more likely to do their gift-shopping online on 12.12. Lastly, Filipinos spend about an average of Php1,013 during an online sale, which is about Php281 more than the average household expenditure per day, as per the latest statistics from the Philippine Statistical Authority (PSA). 

Southeast Asians spent on electronics the most  

According to iPrice’s database, Southeast Asia’s top categories of 2019 are the following: 

  • Electronics: 40% of 2019’s product orders were made from the electronics category. The average amount spent on electronics in a day is US$37 (PHP1,869). 
  • Fashion: About 25% of the product orders received in 2019 were made from the fashion category. The average amount spent on fashion items in a day is US$22 (PHP1,112).
  • Home & Living: About 15% of orders were made from the home & living category. Although it has fewer orders than fashion, the average amount spent on this category is slightly higher, amounting to US$23 (PHP1,162).

Looking at the Philippines’ data, iPrice found that it has the same top categories as the rest of Southeast Asia’s. This goes to show how Filipinos and Southeast Asians’ product interests are similar.

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