Originally published on Parcelmonitor.com, 12th of September 2023.

Understanding consumer behaviour trends in Southeast Asia (SEA) is paramount for businesses aiming to succeed in this dynamic market. From the bustling urban centres of Jakarta and Manila to the remote rural communities, a myriad of factors shape the purchasing patterns and shopping habits of Southeast Asian consumers. 

As technological tools and innovative logistics practices continue to advance, customers’ online shopping behaviour is characterized by increasing expectations of quality standards and a desire for safer and more efficient service delivery. Follow along as we examine some of the biggest customer behaviour trends across the SEA region in 2023 and beyond. 

1) Sustainability is of Vital Importance to SEA Customers 

In recent years, sustainability and environmental consciousness have grown in many areas around the world. SEA customers have not been left behind in this regard and have indeed begun to prioritize green stores. 

This trend is reflected in Rakuten Insight’s findings which reveal that 65% of SEA customers consider sustainability-focused tactics such as sustainable product packaging and the use of collection points to reduce greenhouse emissions to be the most important factor attracting them to retailers. This is most true of the Philippines where 74% of respondents say sustainability is their primary consideration in picking a retailer to buy from. Over 60% of surveyees in Malaysia and Indonesia indicated the same opinion.

Supply chain ethicality is the next issue of concern to SEA customers. This involves the practices utilized in sourcing the raw materials used for the products as well as processing and transporting them. Consumer insights from the region show that 40% of the total respondents revealed that ethical supply chain practice is their key consideration when choosing retailers. 

Furthermore, buyers in the SEA region tend to support businesses that are involved in charitable causes. This is true of 34% and 35% of respondents from Vietnam and the Philippines, respectively. This figure drops to 29% for Singapore and 26% for Indonesia and Malaysia, respectively.

2) SEA Customers Are Very Likely to Switch to Competitors in the Face of Poor Customer Service

In the highly competitive business atmosphere in Southeast Asia, customer experience is one of the key means to ensure customer loyalty and repeat buying. As businesses continue to innovate and improve their services to suit customers’ demands, buyers in SEA have come to expect a high standard of service. 

As per Rakuten Insight’s research, 50% of SEA customers in general stated that they would be very likely to switch their patronage to a competitor if such a business failed to provide good customer service. This result was obtained from a survey in which respondents were required to choose how likely they would be to go for a different retailer if they experienced poor service. Respondents’ options ranged from “very likely” to “likely”, “unlikely” and “very unlikely”.

A breakdown of this statistic shows that 60% of examined Indonesian shoppers would be “very likely” to jump ship when faced with subpar service. The Philippines is next in line with 52%. Vietnam, Malaysia, and Singapore are next with 46%, 45%, and 44% of their respective surveyees indicating the same. 

A slightly lower figure of 41% of total respondents indicated that they would be “likely” to switch to another retailer if and when they received poor service. Interestingly, only a combined 8% of total respondents stated that they would either be unlikely or very unlikely to leave their favourite retailers even when they receive poor service. In general, excellent customer service delivery remains key in the SEA region to keep customers satisfied and loyal. 

3) Good Customer Reviews Are an Important Consideration to Keep SEA Customers’ Loyalty

With the increasing popularity of e-commerce, there has also been an increase in the number of unreliable e-commerce service providers. Trust remains key in online business and customers are generally wary about falling victim to e-commerce scams or patronizing e-retailers who produce bad service. While product prices play a major role in customers’ choices of retailers, there are several other issues that are taken into consideration before making this decision. Rakuten Insight had customers from all five countries rank a number of common customer considerations from 1 to 6 according to how important each factor was to the surveyee.

In all of the countries surveyed except Vietnam, the majority of customers deem positive online reviews and ratings as the most important reason for repeat purchases from any given store. This is true for 35% of Filipino respondents. 29% of Indonesian, and 27% of Malaysian and Singaporean respondents also ranked online reviews as their no.1 driver for repeat buys. In the meantime, around 14% of the same group stated that they considered fast and reliable shipping to be their first consideration for making repeat purchases. 

Regarding loyalty programs such as rewards and discounts, 19% of respondents from Malaysia as well as from Singapore say this would be their primary consideration in deciding to stay loyal to a store. The same is true of 18% of Vietnamese respondents and 16% of Indonesian surveyees. 

Fewer respondents indicated that other factors, such as the availability of a wide variety of products, convenient payment methods, and hassle-free returns, would be their primary incentives to maintain their loyalty to any store.

In sum, this survey shows that SEA customers prefer to look up retailers’ reviews online as a means of measuring the businesses’ credibility and to help them decide whether or not to make repeat purchases from the said store(s). In a region with an internet penetration rate of 80%, online review research is easy and convenient for buyers.

4) Timely Updates on Product Location is Key for SEA Customers in Product Tracking

Tracking is an important part of logistics which allows customers to follow the movement of their products from the warehouse to their collection points or doorstep. Effective product tracking improves customers’ peace of mind and promotes effective deliveries as buyers know exactly when their orders will get to them. 

Out of a range of tracking factors, 36% of respondents from Malaysia stated that timely updates on parcel location were their most important consideration regarding tracking. The same is true for 35% and 32% of Singaporean and Filipino respondents, respectively. This is indicative of a growing taste for real-time tracking updates driven by the increasing use of innovative logistics technologies, which have helped digitalize logistics deliveries in the region. Such technologies include Alibaba’s EasyDispatch, which uses AI and Machine Learning to organize parcel deliveries.

Easy access to comprehensive order and delivery information is the next most popular tracking factor for SEA customers, with at least 24% of respondents in each country picking this option. This information is crucial for e-commerce customers because it provides transparency and convenience. It allows customers to track their orders, estimate delivery times, and address any potential issues promptly. This transparency builds trust between the customer and the e-commerce platform, leading to a better overall shopping experience.

5) Accurate Parcel Arrival Date is Crucial for SEA Customers

Accurate parcel arrival dates also play a pivotal role in enticing SEA e-commerce customers to make purchases from online stores. This trend is closely linked to evolving consumer preferences and market trends within the region.

Among all respondents, a whopping 80% stated that they would make repeat purchases from stores that give them specific delivery dates. This view is most prevalent in the Philippines, with 85% of Filipino respondents saying that accurate delivery dates are vital for them. The same opinion is held by 80% of surveyees from Malaysia and 78% from Indonesia. 

Consumer preferences in Southeast Asia are greatly influenced by the fast-paced nature of modern life. Customers are increasingly drawn to the convenience of online shopping, seeking seamless experiences that mimic the efficiency of traditional retail. Accurate parcel arrival dates cater to this preference by providing customers with a clear understanding of when their purchases will be delivered. This assurance aligns with their desire for predictability and control over their shopping experience.

Furthermore, market trends in Southeast Asia reflect a surge in demand for e-commerce, spurred by factors like improving internet connectivity and the proliferation of smartphones. In this landscape, e-commerce platforms are vying to capture customers’ attention. Offering accurate parcel arrival dates not only meets the expectations of tech-savvy consumers but also addresses a longstanding concern: the uncertainty surrounding delivery times.

Moreover, the region’s geographical diversity and varied logistical challenges make delivery estimates particularly crucial. By delivering packages on time as promised, online stores can differentiate themselves in a competitive market. This leads to enhanced customer loyalty, positive word-of-mouth, and repeat business. 

Navigating the Future of Consumer Behavior in Southeast Asia

All in all, by recognizing and adapting to the consumer behaviour trends shaping Southeast Asia in 2023, businesses can position themselves strategically to harness opportunities, build lasting customer relationships, and thrive in this diverse and ever-changing market environment. From sustainability and customer service to reviews and logistical efficiency, these insights provide a roadmap for fostering customer loyalty and driving success in this vibrant and evolving market.

Related articles: What Consumers Trully Think of Returns, Effects of Estimated Delivery Date on Consumer Satisfaction, Navigating the Top Pain Points of Parcel Deliveries in Asia

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