Today, we’re looking at e-commerce across SE Asia. It’s characterized by rapid growth, plenty of VC investment and some surprisingly strong early homegrown e-commerce players. PaySec CEO Richard Barry says e-commerce opportunity is knocking throughout SE Asia. The Motley Fool in Singapore shares 15 reasons the digital economy could be huge in SE Asia. The SE Asia economy will grow in value to more than $200 billion by 2025, according to a report from Google and Temasek. The same report says the e-commerce market in Singapore is expected to be worth US$5.4 billion (S$7.46 billion) by 2025.
Tech in Asia uncovers South Korea’s 15 top-funded startups. Indonesia loosens e-commerce investment regulations to encourage foreign investment. Indonesia expects to get more than $14.6 billion of new investment into Indonesian startups says AMVESINDO. Alibaba Group executive vice-chairman Joseph Tsai said Alibaba is keen on investing in SE Asia. Following a recent launch, Rocket Internet’s shopping discount site CupoNation Malaysia is already soaring.
Ecommerce opportunity is knocking in south-east Asia
China is already the world’s biggest ecommerce marketplace and it is growing by a third year-on-year.
There are 365 million Chinese online shoppers and collectively they spent close to $600 billion (£411 billion) in 2015. A digital revolution has opened up the Asian market and that, combined with an expanding middle class with disposable income, has led to an explosion in Asian e-commerce. While China leads the way, others will follow in its slipstream. Indonesia is the world’s fourth most populous country with 250 million people and is already exhibiting similar traits.
To stake your claim in these territories you need to understand not only the marketplace, but the culture and regulatory frameworks that differ greatly from those in Europe and America. “What we say and how we say it, and what we sell and how we sell it, is not just about translating language but about translating your approach,” says PaySec CEO Richard Barry. Via business-reporter.co.uk
15 Signs That South East Asia’s Digital Economy Could be Huge
Services are moving online and the shift to a digital world may be gaining momentum. Traditional businesses may in fact already be feeling the heat from the rise of the digital economy.
For instance, bricks-and-mortar retailer Isetan (Singapore) Ltd (SGX: I15) noted that technological-savvy customers are turning to e-commerce, intensifying the competition for consumers’ dollars. Meanwhile, mall owner CapitaLand Mall Trust (SGX: C38U) is taking big steps to draw customers back to its malls and away from online shopping.
Elsewhere, land transport services giant Comfortdelgro Corporation Ltd (SGX: C52) is facing competition from the likes of ride-hailing apps such as Uber and Grab. There are signs that the digital economy might even accelerate from here. A recent study by Google and Temasek, one of the Singapore government’s investment arms, had highlighted 15 key figures that investors might want to take note of Via fool.sg
Southeast Asia: The Next Big Ecommerce Market
Southeast Asia is the world’s fastest growing internet region and is expected to grow in value to more than $200 billion by 2025, according to a report from Google and Temasek, the Singapore sovereign fund. The three key industries driving this growth: ecommerce, online advertising and gaming, and leisure travel.
Of these three sectors, ecommerce is the fastest growing, the report said, with an impressive 32-percent annual growth rate.
Southeast Asia has a young population, and it is growing fast. The Philippines has the region’s youngest population, with 44 percent of the population under the age of 19 and 75 percent under 40. In Indonesia, 60 percent are under the age of 30. Via globaltrademag.com
New report touts potential of Southeast Asia’s e-commerce
Although a new study by Google and Singapore’s sovereign wealth fund Temasek projects the Southeast Asian e-commerce market to reach US$200 billion by 2025, the region’s air cargo capabilities remain underdeveloped, according to Cainiao, the logistics unit of Chinese e-commerce giant Alibaba.
This week’s Temasek-Google report underscores just how important the market will become in the next decade, and increases pressure on both policy makers and airfreight companies to respond. Currently, the region is adding 3.8 million new internet users a month. The report raises a number of challenges to e-commerce over the next decade, and highlights inconsistent regional logistics as a major impediment. However, it also contends that, with between $40 billion and $50 billion in investment, Southeast Asia’s digital economy can make significant strides over the next decade and meet these projections. Most of the projected growth is the product of three important factors: about 70 percent of the population is under the age of 40, the region lacks big-box retail capacity and the middle class is growing rapidly.
Alibaba Group Executive Vice Chairman Joseph Tsai told the audience at an event put on by Temasek and Google in Singapore this week that Indonesia’s per-capita GDP of about $2,900 was roughly the same as China’s in 2009. As the world’s fourth most populous country, Indonesia is expected to drive a large share of anticipated growth as living standards rise and regional investors are already getting on board. In April, Alibaba invested about $1 billion in Singapore-based Lazada Group which operates shopping websites in Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam. Via aircargoworld.com
Singapore e-commerce market to exceed S$7b in 2025: Report
The e-commerce market in Singapore is expected to be worth US$5.4 billion (S$7.46 billion) by 2025, according to a report by Temasek and Google released on Tuesday (May 24). This is larger than the casino industry in 2015, which was valued at about US$4 billion.
The report found that Singapore’s e-commerce market was valued at US$1 billion in 2015, with online shopping making up 2.1 per cent of retail sales – the highest proportion of all Southeast Asian countries surveyed.
Come 2025, Singapore’s e-commerce market is expected to make up 6.7 per cent of all retail sales, behind Indonesia’s 8 per cent, the report stated. Via channelnewsasia.com
Here are South Korea’s 15 top-funded startups
Here are the latest findings from Tech in Asia’s country-by-country top-funded startups series on South Korea. The infographic below uncovers South Korea’s 15 top-funded startups up to date, including its hottest industries and the VCs that invested in the startups.
Over the last two years, ecommerce maintains its seat as the most represented vertical on the list, emphasizing the country’s innovative and fast developing market in the tech scene. Impressively, Coupang has also proven itself by standing at the top of South Korea’s tech startup chain since 2014, and for two years in a row on Tech in Asia’s list. The company is now valued at US$5 billion, netting over US$1.4 billion in funding.
This infographic only consists of startups that are operating independently, so it does not include those that have been acquired or gone to IPO in the past few years. Via techinasia.com
More ecommerce opportunity in Indonesia as foreign investment bans are lifted
The old regulation didn’t differentiate between types of ecommerce business models. It only addressed retail-based ecommerce companies – meaning companies with inventory who sell directly to consumers. E-retail businesses were entirely off-limits to foreigners.
The new regulation introduces a category called “trade transactions through electronic systems.” It names four specific models that fall under it: platform-based marketplaces, daily deals sites, price grabbers (presumably sites that aggregate products sold elsewhere), and online classifieds.
All these business models are open to 100 percent foreign ownership, Harun says, if the investment amount is higher than US$7.3 million. Smaller investments are possible, but then foreign ownership is capped at 49 percent. It essentially says if you want to have full control over the business, you have to make a substantial financial commitment. If you bring less money to the table, you have to team up with a local partner. Via techinasia.com
Get ready for $14.6b pouring into Indonesian startups, says AMVESINDO
Indonesian startups boom has just started. The country’s new-born sector is predicted to receive Rp200 trillion ($14.6 billion) of investments starting this year, as the government is pushing a tax amnesty bill which it says could bring Rp1,000 trillion ($73.2 billion) worth of evaded tax and assets back to Indonesia.
Indonesian association of venture capitals and startups (AMVESINDO) said the money is likely to be invested in tech-based firms. One of the reasons is because conventional sectors are still recovering from the slowdown that hit global economy last year. Commodities, oil and gas, and property, for example, are suddenly less attractive now.
“OJK, the government, the Indonesian chamber of commerce (KADIN), everyone is preparing to welcome these hot funds. We know that the tax amnesty is targeted to be implemented in July,”Teddy Lee, Head of fintech department at AMVESINDO told Via dealstreetasia.com
Southeast Asian economies lure Alibaba
Southeast Asian economies are reaching a stage similar to China’s at the end of the last decade, when eCommerce began to take off, according to Alibaba Group executive vice-chairman Joseph Tsai.
“I don’t blame you guys for having some degree of excitement about Southeast Asia when you look at the economies here,” he has told a Singapore conference staged by Google and local sovereign wealth fund Temasek.
For example, he said, the per-capita GDP of Indonesia, the world’s fourth most-populous country, was about $2900. “That’s roughly the same as China’s per-capita GDP in 2009 and into 2010, a period when Alibaba’s C2C marketplace Taobao began to soar, adding about $50 billion in gross merchandise volume.” Via insideretail.asia
CupoNation Malaysia takes off like a rocket
Following its launch, Rocket Internet’s shopping discount site CupoNation Malaysia is already soaring.
The site is the German startup factory’s fourth foray into Asia Pacific. Already in Australia, India and Singapore regionally, CupoNation is established in 17 markets worldwide, helping shoppers find discounts and deals on eCommerce sites.
Listed on the Malaysian store are offers from Amazon, Dell, Groupon and McDonald’s as well as Rocket Internet affiliated companies like Foodpanda, Lazada and Zalora. It already has more than 500 discount codes available for consumers in Malaysia, with more being added constantly. Via insideretail.asia
US retail ahead
Wednesday’s report will update you on the latest moves in US retail and e-commerce. Stay tuned.