As the world becomes increasingly digital and as social media grows, global consumers are no longer limited to purchasing products exclusively within their own country.

 

Stat shows that global ecommerce is projected to reach $5.55 trillion by the end of 2022 and will only keep growing. What’s more, Asian markets are leading in global ecommerce. Under current projections, Asia will represent 50% of the world’s consumer spending by 2032.

 

While global ecommerce continues to grow and Asia continues to dominate in global ecommerce, there’s a tremendous opportunity for Asian brands and retailers to expand into new markets, capture more global customers, and boost sales.

 

The first step to accomplishing this is understanding the global ecommerce trends driving growth. This article will cover five top trends in 2022 that are highly relevant to international and local brands in Asia.

1. More ecommerce companies are adopting headless commerce

 

Global ecommerce is growing and changing more rapidly today than ever before, commerce tech is innovating quickly, and consumer spending patterns are changing.

 

As a result, ecommerce retailers need to have the flexibility to quickly adjust the front end of their online stores to keep up with new trends. Headless commerce platforms make this possible.

 

Headless ecommerce platforms separate the frontend, or head, of a site from the backend. When a platform is headless, it’s possible to make quick changes to the frontend, such as how the store looks to customers, without impacting backend operations. Research by Salesforce found that companies with headless architecture are more likely to be rapidly expanding into new channels (77%) than non-headless companies (54%).

 

"More brands are turning to headless commerce to facilitate engaging ecommerce experiences. For so long, brands have had to choose between performance and design. But with tech like headless commerce that allows them to have both without compromises, they can reach customers in innovative ways with confidence,” says Kat Ambrose, content marketer at Shogun.

 

The Takeaway: Asian ecommerce companies looking to keep pace with a rapidly innovating industry would do well to adopt a flexible ecommerce platform.

 

2. Customer experience (CX) and personalization are of the utmost importance

 

While the global economy is uncertain, and many consumers are tightening their spending belts, there’s still some good news for ecommerce companies. Worldwide retail sales are still projected to grow 5% year-over-year.

Ecommerce experts assert that companies prioritizing personalization will win more sales as the year closes. And, statistics support this idea as 80% of consumers report they are more likely to buy from businesses that offer more personalized experiences.

 

Providing personalized experiences is when ecommerce merchants use customer data to create individual and highly relevant shopping experiences. For example, if customers shop at an online beauty brand, they’ll want colors that match their style and complexion. A beauty brand could even include a quiz that captures zero-party data and then use that information to provide only the most relevant product recommendations.

 

“2022 brought in financial uncertainty, and we’ve seen consumers scale down their purchasing behavior. Consumers continue to choose brands that choose them and dedicate time and resources towards providing great customer experiences,” says Eli Wiess, senior director of CX and retention at Jones Road Beauty.

 

“One thing that’s worked very well at Jones Road Beauty is personalization. Customers who were shade-matched by our concierge team have had a 111% higher LTV than standard customers. That’s one thing we are certainly going to take into 2023.”

 

The Takeaway: Ecommerce retailers that will stand out will be the ones that focus on creating highly personalized experiences for their customers.

3. Live commerce continues to grow quickly in Asia (and slowly in the West)

 

China was the first to introduce live commerce with the arrival of Alibaba’s Taobao Live in May of 2016. The idea was to link livestreaming with ecommerce sales stores, so customers could watch promotional videos live and shop simultaneously.

 

Since its inception, the livestreaming trend has been wildly successful and skyrocketed across Asia. Now, livestreaming events are a major part of monumental shopping days like Singles’ Day in China.

 

While China was the first to introduce live commerce, stats about the usage in Vietnam are telling. Statista reports that Vietnam has the highest usage rate of live commerce at 70%, and 92% percent of respondents in Vietnam reported they were aware of live commerce.

 

But, these usage rates aren’t the same across all of the Southeast. Singapore came in with the lowest number of livestreaming shoppers at only 21%.

 

“Live streaming is a hot topic these days. In Southeast Asia, livestreaming is still in its infancy, compared with China, where it’s contributed greatly to sales. The Chinese KOLs or creators are highly engaging and interactive when they stream, and they convert sales as well. In this area, Southeast Asia has the potential to grow, especially in fashion and beauty,” says Victor Liu, VP of Asia at Baozun.

 

Livestreaming is also projected to see tremendous growth in other non-Asian markets across the globe. Many countries in the West, along with big companies like Amazon, TikTok, Facebook, and Google have been slow to adopt live commerce but are making strides to participate in this trend.

 

 

The Takeaway: There’s room for companies in Southeast Asia to capture more global customers via livestreaming. China has set the benchmark for what the rest of the world can achieve with live commerce.

4. Payment tech will continue to evolve, providing easier checkout for consumers

 

Payment tech innovation and adoption vary greatly across the world. Even in countries that lead in fintech adoption — China, U.S., Mexico, South Africa, and the U.K. — there is still room for growth and further adoption.

 

For example, McKinsey reports that even though much of Asia has adopted digital payment methods, the region remains the world’s most cash-reliant nation. In 2019, cash represented 71% of all transactions.

 

For all global ecommerce companies, however, convenient, cashless payments are mandatory. The good news is 49% of urban consumers in Asia who are commercial bank users are already using e-wallets, and it’s projected that this trend will reach 84% by 2025.

 

“Salesforce reporting from 2021 showed that Cyber Week transactions showed an increase in 'mobile wallet' usage and a decrease in credit card checkout for the first time ever. That means more and more people are checking out with Apple Pay, PayPal, Venmo, and Buy Now Pay Later options,” says Ian Leslie, editor-in-chief of Banknotes by Hashtagpaid.

 

“This trend has already taken hold in China where credit card payments have been the second most popular checkout method behind mobile or e-wallets for a couple of years now. It will be critical for ecommerce sites to continue to take advantage of this trend but doing so in the most efficient way possible with little tech and development overhead.”

 

The same McKinsey report listed above also projects that digital wallets and QR codes will soon become the norm, and current payment methods (e.g., credit cards) will be reformatted to work within digital-wallet front ends.

 

The Takeaway: More global consumers in urban areas — especially across Asia — are adopting digital payment tech. Ecommerce companies in Southeast Asia can benefit from embracing payment tech innovation and prioritizing e-wallets.

5. Supply chain is finally improving in China, but there’s still room for logistics to innovate in Southeast Asia

 

The staunch lockdowns in China during the height of the COVID-19 pandemic caused significant stalls in the global supply chain.

 

But, as China continues to ease its lockdown protocol, the supply chain is speeding back up, costs are reducing, and the backlog of shipments in China is clearing. Once the backlog is cleared, ports in Europe and the United States will see a rush of shipments, according to reporting by CNBC.

 

"Port delays and costs out of China have rapidly normalized in the last several months. Capacity out of China is improving because many brands and retailers in the U.S. are over-inventoried,” says Joel Carlin, supply chain manager at  KURU Footwear.

 

With the supply chain normalizing, lags in products coming out of China are resolving, making it easier for companies to restock their inventory.

 

Even though China’s supply chain is improving, there’s still room for effective logistics solutions in the rest of Southeast Asia.

 

“The eCommerce and cross-border trade boom in Asia has spotlighted the region as a global logistics hub, with much potential for further growth… As the sector expands, the demand for digitalization and technological investments within the logistics sector is expected to increase, indicating growth opportunities for businesses,” says Dr. Ding Hongwei, general manager of China's logistics giant, Cainiao Technology.

 

“Coupled with mounting pressures put forth by consumer demands for better, faster, and cheaper logistics services, companies need to evaluate the operational processes in their value chains to remain agile. Although the supply chain disruptions marring the global economies today have accelerated digital adoption, there is still much room for greater efficiency, productivity, and sustainability.”

 

As ecommerce companies in Southeast Asia look into global expansion, improving logistics and adopting better technology will be the gateway to growth.

 

The Takeaway: Ecommerce companies relying on products from China will see delays resolved, but there’s still room for better logistics solutions across Southeast Asia.

Grow your company by choosing the right ecommerce solution

Ecommerce sales in Southeast Asia will total $89.67 billion in 2022, an increase of $15.31 billion over last year. By next year, the region will cross the $100 billion mark, a long way from the $37.22 billion seen in 2019.

 

Additionally, experts project Vietnam, the Philippines, Indonesia, Malaysia, and Thailand will rank among the top 10 markets measured by retail ecommerce sales growth.

 

However, this kind of growth doesn’t happen without keeping a pulse on global ecommerce trends, and without using the best ecommerce solutions provider.

 

Look for an ecommerce solution that helps you with IT solutions, e-store or marketplace operations, digital marketing, customer services, and supply chain logistics. Need a place to start? Feel free to reach out to our team members at sea@baozun.com if you're interested in learning more about how we can help your business grow through our expertise.

 

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