• Jefrey Gomez

e-Conomy SEA 2020: What Marketers Need to Know About the Digital Shift

Internet usage in Southeast Asia (SEA) has multiplied rapidly over the last few years. 40M new users were added in 2020 alone in the region. However, the COVID-19 pandemic has triggered a permanent and massive spurt in digital adoption with more than 1 out of 3 consumers of digital services being new to the service.


90% of these new users continue exploring their new-found habits and interests, which makes it challenging for marketers to create content that appeals to their users.


Luckily, the multi-year research launched by Google and Temasek in 2016 to study the SEA economies has examined the digital economy of the region in various industries in the wake of COVID-19. The report sheds light on what marketers can do to prepare themselves for the massive digital shift and the current trends.


Here are the major highlights of the report.


1. Increase in Consumers Using Digital Services for the First Time


40 million new people started using the internet in SEA this year compared to 100 million new users between 2015 and 2019. It means that almost 70% of the people in SEA now use the internet.



People who started using digital services due to the lockdown restrictions began taking the advantage of online education, entertainment, finance, and other services. 1 in every 3 digital consumers is new to the service.



Another data worth pondering upon is that internet penetration is no longer confined to the metro cities but has now transgressed into non-metro cities too. Except in Vietnam and Thailand, the majority of new consumers are from non-metro cities with consumers in non-metro areas of Malaysia forming the biggest percentage of users from non-metro cities.


2. Digital Adoption is Here to Stay


As people continue putting their trust in digital services, there has been a considerable shift in consumer behaviour and purchase patterns. 9 in 10 users across SEA said that they would continue using digital services even after COVID-19. This means that by 2025, online gross merchandise value will be more than $300 billion.



Not only do people intend to use digital services post COVID-19, but they also spend more time online. There was an increase of 1 percentage point (PP) from 3.7 to 4.7 during the lockdown. The number stayed 0.5% higher at 4.2 even after the lockdown ended.



Also, people who used the Internet every hour almost doubled from 24% to 46% during the lockdown and stayed 10 PP higher than the previous frequency at 34%.


3. Internet Coming to People’s Rescue


The shift in internet usage is also because people discovered new ways of how they can benefit from the internet. While Indonesia saw the highest increase in internet usage of 27%, the Philippines registered the highest increase in average time spent online each day. Also, while Philippines users spent an average of 4 hours online before the lockdown, they now spend an average of 4.9 hours online.




Also, people have started perceiving the Internet as more useful than they did before. For example, 85% of people said that they found the internet quite useful during the lockdown for purchasing groceries. The number was 80% for education and 87% for food delivery.



4. Lasting Adoption of e-Commerce


While digital services are picking up, the sharpest increase in the use of digital services was witnessed in the e-Commerce sector. Indonesia, Malaysia, and the Philippines recorded the highest increase in e-Commerce usage during the lockdown with almost 100% increase in the use of e-Commerce.



This push in e-Commerce adoption ranges from various reasons. 47% of new users said that e-Commerce saved time and energy. 49% of new users also cited decreased exposure to COVID-19 as the primary reason for shopping online.


However, 40% of the users also said that delivery issues constrained them from using e-Commerce, which means that e-Commerce brands need to streamline their delivery process in the near future.


5. Boost in Domestic Travel


The lockdown and the subsequent travel restrictions have resulted in people craving to come out of their homes. This has translated into short domestic tours with 65% of people across SEA planning to travel domestically within the next six to twelve months.



Safety was cited as the top-most consideration while travelling. 78% of consumers said that they would prefer companies that give more importance to health and safety. Also, consumers are now more likely to purchase experiences online to avoid lining up in person.


Also, consumers have gotten more averse to risk. Travel insurance purchase has shot up and the usage of pay-later services while booking a trip is also becoming more common.


Key Takeaways for Marketers


Since digital payments are only expected to become more popular, brands need to ensure that they integrate their digital payment options for their consumers. Also, since there is a surge in the number of new digital customers, brands should reach out to new users who are yet to decide the products that they want to use.


To get an idea of the shift in consumer purchase behaviour, brands can use Google App campaigns to boost app downloads and look at Google Trends.


Regardless of the instability, the internet sector in SEA is going to emerge stronger in the post-COVID-19 world. Considering the rapid shifts that are taking place, brands would do well to keep a tab on people’s changing online habits, as well as, keeping up with the changing trends.


To delve deeper into the findings of the study, find the full report here.