The increasing number of digital consumers in Southeast Asia is helping drive the growth of internet economy in the region.
This is according to the latest report by management consulting firm, Bain & Company, titled Digital Acceleration in Southeast Asia: Navigating Tectonic Shifts. The report is based on a survey of 2,400 consumers across Indonesia, Malaysia, Philippines, Singapore, Thailand, and Vietnam.
The report found that around 230 million people in the region are now 'online engaged consumers' or those who have at least researched products or services online. This indicated an increase of 50 percent over last year.
E-commerce was also tagged as the second largest contributor in the region's digital market at US$15 billion, following travel and tourism (US$22 billion). The survey showed at least 90 percent of respondents across every country - except Singapore - have made a purchase via social media or were influenced by it.
Meanwhile, the research suggests that the digital economy in Southeast Asia has emerged as a key battleground for large industry players from other regions - mostly from the U.S. and China. However, the increasing number of digital users with a fragmented market signifies that local players are also successfully competing and gaining an edge against their foreign competitors.
"Southeast Asia has become a proving ground for digitally native companies as well as traditional companies looking to tap into the digital market," said Sebastien Lamy, an expert in Bain's Digital Practice and co-author of the report.
"We have seen many companies succeed here, but an almost equal number succumb to the pressures and challenges of a still maturing market. Those that can develop and implement a strategy focused on adaptability, flexibility and reinvention are likely to come out on top," Lamy added.
In line, Bain & Company identified three ways companies can get ahead of the digital wave:
- Innovate rapidly to create new products and services with the use of digital technologies.
- Initiate a tech-enabled transformation to improve customer experience.
- Reinvent internal functional capabilities to adapt to and leverage the digital world.
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