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E-Commerce in Southeast Asia 2017. How Big was it?

E-Commerce in Southeast Asia 2017. How Big was it?
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Internet commerce across Southeast Asia, also known as e-commerce, was worth $50 billion in 2017, according to a Google Temasek report.

But a more detailed report published by the iprice Group operating out of Kuala Lumpur show the bulk of transactions exceeded $10 billion in gross merchandize value (GMV) and conducted over mobile platforms as opposed to desktop purchases. (For further detail, go to iprice insight site here)

The GMV on firsthand goods of more than $10 billion represented compound annual growth rate of 41 percent, from only $5.5 billion in 2015, according to the Google Temasek report.

Angela Marie Gratela, content marketing executive at iprice, said mobile e-commerce transactions demonstrated unstoppable growth during the period by expanding an average 19 percent over 12 months and accounting for 72 percent of all e-commerce traffic in the Internet.

E-commerce transaction was largest in Indonesia, where it accounted for 87 percent, followed by Thailand, where it owns 79 percent of market. The Philippines was third largest, where e-commerce owns 76 percent, Gratela said.

Mobile traffice | medium.com
Mobile traffice | medium.com

 

In one of the countries surveyed was desktop-based purchases accounted for more than 30 percent of internet traffic, she quickly added.

E-commerce conversion, indicating web site visits turning into actual purchases, was highest in Vietnam at 1.3 times and lowest in the Philippines where it stood at only 0.8 times. Vietnam’s conversion rate was higher than even Singapore’s 1.1 times. The numbers indicate the low level of correlation between the conversion rate and the level of maturity between each e-commerce market, Gratela said.

Data from iprice also show that while e-commerce transactions were fastest in the mobile segment, the conversion rate was substantially higher in the desktop segment.

According to iprice data, which used the average mobile conversion rate in Southeast Asia are reference, the conversion rate for desktop was 1.7 times higher than the average mobile conversion rate.

In terms of basket size, indicating the average amount spent for each online purchase by a customer was highest in Singapore, followed by the Philippines, with Vietnam at the bottom of the rankings.

“The basket size results to be closely correlated to the GDP per capita of each country. Singapore has the highest GDP per capita [$90,530], while Vietnam has the lowest GDP per capita [$6,880]. Relatively, Singapore’s merchants score highest with a basket size of $91, 3.7 times higher than their Vietnamese counterparts, with an average basket size of $23,” the iprice said.

Conversion times | medium
Conversion times | medium

 

Its data also show the average order value to be consistently higher on desktops than on mobile platforms ranging from 8-percent to 20-percent conversion rate in any country in Southeast Asia and an indication of consumer preference for completing larger purchases over desktops than on mobile.

Such purchases typically also happen between 9 a.m. and 5 p.m. across all six Southeast Asian countries in the survey, except in Singapore, where online purchases peak at 10 p.m.

“Considering the average number of order of the local country as reference [100  percent], the number of orders is highest between 9 a.m. and 5 p.m., when people are traditionally at work or school, with the exception of Singaporeans, who seem to enjoy evening shopping more than other countries, peaking at 10 p.m. Consistently across countries, there is a dip between 5 p.m. and 7 p.m., were people typically commute and have dinner, before getting back into online shopping until 11 p.m.,” the iprice reported.

Basket size vs GDP percapita | medium
Basket size vs GDP percapita | medium

 

Peak days were Wednesdays and the preferred mode of payment was cash on delivery 80 percent of the time in both the Philippines and Vietnam. The iprice said this had “structural” reasons, chief among them the low credit-card penetration in Ho Chi Min City and Manila.

“Bank transfer is another very popular payment method across SEA, with respectively 94 percent, 86 percent and 79 percent of merchants in Indonesia, Vietnam and Thailand offering it. In Thailand and Vietnam, almost 50 percent of merchants offer off-line point of sales [ie., 7 Eleven].

Payment solutions offered by merchants | medium
Payment solutions offered by merchants | medium

 

Payment by installments proves to be very popular [and increasingly so] in both Vietnam [47 percent of merchants] and Indonesia [42 percent],” according to iprice.

Source : iprice.com | Business Mirror | Medium

Akhyari Hananto

I began my career in the banking industry in 1997, and stayed approx 6 years in it. This industry boost his knowledge about the economic condition in Indonesia, both macro and micro, and how to More understand it. My banking career continued in Yogyakarta when I joined in a program funded by the Asian Development Bank (ADB),as the coordinator for a program aimed to help improve the quality of learning and teaching process in private universities in Yogyakarta. When the earthquake stroke Yogyakarta, I chose to join an international NGO working in the area of ?disaster response and management, which allows me to help rebuild the city, as well as other disaster-stricken area in Indonesia. I went on to become the coordinator for emergency response in the Asia Pacific region. Then I was assigned for 1 year in Cambodia, as a country coordinator mostly to deliver developmental programs (water and sanitation, education, livelihood). In 2009, he continued his career as a protocol and HR officer at the U.S. Consulate General in Surabaya, and two years later I joined the Political and Economic Section until now, where i have to deal with extensive range of people and government officials, as well as private and government institution troughout eastern Indonesia. I am the founder and Editor-in-Chief in Good News From Indonesia (GNFI), a growing and influential social media movement, and was selected as one of The Most Influential Netizen 2011 by The Marketeers magazine. I also wrote a book on "Fundamentals of Disaster Management in 2007"?, "Good News From Indonesia : Beragam Prestasi Anak Bangsa di dunia"? which was luanched in August 2013, and "Indonesia Bersyukur"? which is launched in Sept 2013. In 2014, 3 books were released in which i was one of the writer; "Indonesia Pelangi Dunia"?, "Indonesia The Untold Stories"? and "Growing! Meretas Jalan Kejayaan" I give lectures to students in lectures nationwide, sharing on full range of issues, from economy, to diplomacy Less
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