The rise of social commerce in Southeast Asia
In the age of Facebook, Twitter, and Instagram, social commerce can no longer be ignored bymarketers. Social commerce is a subset of electronic commerce that involves the use of social networks to promote online buying and selling of products and services. Online vendors engaging in social commerce take on creative tactics, including inviting users to vote on product styles, encouraging user-submitted feedback, garnering interest through celebrity endorsements, and concentrating consumer attention using hashtags. Social commerce is changing the field of online marketing and opening vast opportunities for vendors, as online shopping continues to grow.
What spurred the growth of social commerce?
While traditionally, consumers are more accustomed to shopping at physical storefronts where products are available for first-hand testing, all market segments are experiencing a shift of consumers valuing convenience over product experience. In PayPal’s social commerce report, 85% of consumer respondents in the Southeast Asian region have commented on the ‘quick and easy’ convenience of making an online purchase through social media.
Of approximately 350 million internet users in the region, 90% connect to the internet through their smartphones. Millennials make up the bulk of social commerce usage with 21 to 40-year-olds leading all aspects of social trade, including using social media to sell unwanted goods to supplement their income, as well as buying products and services. Millennials are also among the highest users of new digital payment methods, with 50% of 31 to 40-year-olds and 44% of the 21 to 30 age bracket consumers using digital payment methods. As the growth of smartphones in Southeast Asia relates directly to social media and digital payment usage, social commerce is expected to experience even more growth in the coming years.
Potential of social commerce in Southeast Asia
Considering the lightning-speed growth of smartphone ownership, Think with Google reports that the market will grow beyond $100 billion USD per annum by 2025. Furthermore, 56% of respondents to Think with Google’s report indicates that social media has a direct influence on over a quarter of their purchases, while 96% of respondents reported deliberately visiting social media sites before making a purchase.
The phenomenon of social commerce has not gone unnoticed by Southeast Asian merchants. Those surveyed by PayPal have reported that 80% have been selling through social media platforms with 95% Thailand and 87% in the Philippines doing so. Even consumers are capitalising on this upward market trend, with 21% of Southeast Asians reportedly using social networking sites to sell goods and services, whether to supplement their income or dispose of unwanted goods.
With low overheads and an expansive pool of ready customers, social commerce is widely available to producers, retailers and customers. In PayPal’s report, 93% of Southeast Asian vendors have reported an increased market reach, and 92% have indicated that social commerce has greatly improved their financial conditions. While a small percentage of merchants (11%) reportedly have yet to incorporate social media into their business models, 80% indicated that they are likely to sell through social media platforms in the future.
Tools you’ll need
To harness the potential of social commerce efficiently, many data-driven considerations come into play. Optimisation of sales in various online marketplaces such as on Facebook and Instagram requires its own fine-tuning according to each product and individual platform. Merely learning how to leverage technology to grow your business, let alone automating your business, can be a daunting entrance into the world of social commerce.
CrescoData is a cloud-based technology business that facilitates the cleaning, mapping and connecting of commerce data of your consumers’ digital experiences of your company. CrescoData works to provide flexible and personalised solutions for businesses ranging from simple to complex commerce data mapping and automation problems. Utilising AI and machine learning to process and connect products to consumers, CrescoData works with a wide range of leading commerce platforms to connect businesses to over 70 channels through one API. Vendors can leave the grunt work of removing costly channel maintenance, manual mapping, automating and synchronising products, and updating product and order reports to CrescoData’s state-of-the-art technology. This allows business owners to focus on product development and the growth of their businesses.
CrescoData is a globally connected team of experts and developers with over 40 years of commerce experience. Partnered with market-leading commerce platforms, such as Lazada, eBay, Google Shopping, Facebook, Magento, and Amazon, CrescoData has helped build businesses across ten countries in 8 different languages. With over 120 million products processed in the last 12 months, CrescoData is Asia Pacific’s leading enterprise commerce automation platform reducing onboarding barriers and advancing years worth of vendors’ online presence in a matter of weeks. Contact us to learn more about our industry-leading products and services to maximise your business’s reach and potential.