Southeast Asia’s E-commerce Boom: Insights from the 2024 Report
The recent Southeast Asia E-commerce 3.0 report by Momentum Works unveils significant trends in the region’s online shopping landscape, underscoring the remarkable growth and evolving dynamics of e-commerce. With an impressive total gross merchandise value (GMV) of US$128.4 billion in 2024, representing a 12% increase from the previous year, the Southeast Asian e-commerce market is approaching the scale of the US, processing an astounding 43.6 million online orders per day.
Dominant Players in the Market
Central to this explosive growth are key players, notably Shopee, Lazada, and TikTok Shop, which together account for over 90% of the total order volume. This consolidation highlights the competitive nature of the market, where brands strive for consumer attention in a crowded digital space. Vietnam stands out as one of the top five e-commerce markets in the region, alongside Thailand (US$23.5 billion), Malaysia (US$11.5 billion), the Philippines (US$16 billion), and Singapore (US$4.9 billion). Notably, Thailand and Malaysia have exhibited remarkable growth, with rates of 22% and 20%, respectively.
Indonesia’s Market Landscape
Despite the rise of its neighboring nations, Indonesia retains the title of the region’s largest e-commerce market with a GMV of US$56.5 billion, holding a significant 44% market share. However, this growth has slowed to just 5%, primarily due to ongoing platform mergers that have reshaped the competitive landscape.
Vietnam’s E-commerce Dynamics
In Vietnam specifically, the e-commerce terrain is primarily dominated by three giants. Shopee captures a hefty 65% market share of GMV, translating to about US$10.4 billion. Following closely is TikTok Shop, which has rapidly gained traction with a 28% share (US$4.5 billion), while Lazada holds 6% (US$1 billion) and Tiki remains a minor player at 1% (nearly US$200 million). This distribution reflects a robust competitive milieu where established platforms and newer entrants are vying for consumer loyalty.
Beyond Major Platforms
Interestingly, the report identifies alternative digital commerce channels that contribute significantly to the region’s e-commerce landscape. These include brand websites, multi-brand retailers, social media platforms, and messaging apps like WhatsApp, collectively adding another US$16.8 billion to the total e-commerce value. This diversification illustrates the evolving habits of consumers who increasingly seek convenience and personalized shopping experiences.
Resurgence of Chinese Brands
A noteworthy trend in the report is the resurgence of Chinese consumer brands within Southeast Asia. These brands are making a strategic comeback, presenting upgraded products and more localized marketing strategies aimed at capturing specific market segments. This could signify a fresh wave of competition, forcing local businesses to innovate and enhance their value propositions.
Future Projections
Looking ahead, Momentum Works predicts substantial growth for the e-commerce sector. The report suggests that if businesses effectively leverage artificial intelligence across various functions—such as sales, operations, logistics, and customer service—they could generate an additional US$131 billion in transaction value by 2030. This potential enhances the allure of the e-commerce market for investors and stakeholders alike.
The Rise of Gen Z Shoppers
A shift in consumer behavior also plays a pivotal role in shaping the e-commerce landscape. Individuals from Generation Z, those born in the mid-90s, are leading the charge for online shopping. Their inclination towards convenience and deals, coupled with their tech-savvy nature, is altering traditional buying patterns. The interplay of digital engagement and savvy shopping strategies among this demographic proves crucial for businesses aiming to capture this lucrative market segment.
As the e-commerce scene in Southeast Asia continues to evolve, it remains a vibrant landscape filled with opportunities and challenges, where innovation and adaptability will be key for success in this competitive arena.