Tag: E-commerce

Jakarta, Indonesia – E-commerce company Bukalapak has addressed reports of an alleged acquisition by Temu on the local e-commerce player. It is worth mentioning that various reports have stated that Bukalapak’s share price increased by over 22% in the past 5 days, from 120 rupiah on Oct 2, 2024, to 147 rupiah per share on October 8 over alleged acquisition talks.

In a letter to the Indonesian Stock Exchange (IDX) reviewed by MARKETECH APAC, Bukalapak stated that they are not aware of any information regarding its acquisition plans by TEMU.

“The increase in share price on October 7th, 2024 reflects the market’s reaction to unverified information regarding the Company’s acquisition plans, which has not been confirmed by the company’s management. Market speculation is beyond the company’s control,” wrote Cut Fika Lutfi, corporate secretary at Temu.

Bukalapak has advised public shareholders and investors to observe official disclosure of information by the company before making any investment decisions on the company.

It is worth mentioning that this news follows the Indonesian government mandate to ban Temu in the country in a bid to safeguard the standing of local SMEs in the country.

Jakarta, Indonesia – Popular Chinese e-commerce app Temu has been blocked from entering from Indonesia, according to a statement from Fiki Satari, Special Staff to the Minister for Creative Economy Empowerment at the Ministry–and confirmed by the country’s Ministry of Cooperatives and SMEs.

According to the ministry, should Temu enter the country, it will result in jeopardising sustainability of MSME players in the country.

“If Temu enters, it will greatly threaten local MSMEs. This application from China allows direct transactions between factories in China and consumers in Indonesia, which has the potential to kill small businesses here,” Fiki said in a statement.

Fiki explained that Temu’s business model enables goods to be sold directly from factories to consumers, eliminating the need for intermediaries like sellers, resellers, dropshippers, or affiliates. Furthermore, the platform offers subsidies, which significantly lowers product prices.

“They have entered the US and European markets, and are now expanding into Southeast Asia, including Thailand and Malaysia. Therefore, we must remain vigilant and ensure Temu does not enter Indonesia,” he added.

It is worth noting that since September 2022, Temu has tried to register its trademark in Indonesia three times. On July 22, 2024, they again applied for registration at the Directorate General of Intellectual Property Rights (DJKI), Ministry of Law and Human Rights.

“Temu App has tried to register trademarks, designs, and others with the DJKI. However, they have not been able to enter because there are already companies from Indonesia that have similar names and business categories. Even so, we must remain vigilant and continue to monitor,” Fiki explained.

Fiki hopes that various relevant agencies, including the Ministry of Law and Human Rights, the Ministry of Trade, the Ministry of Communication and Information, along with other stakeholders, will collaborate to prevent the entry of the Temu marketplace into Indonesia.

Singapore – TikTok, Instagram, and WhatsApp shops are preferred by Southeast Asian (SEA) consumers due to convenience, a new report from martech company Netcore Cloud recently revealed. 

While TikTok shop use is in the lead, Instagram and WhatsApp shops show a rise in consumer preference with 90% of respondents applauding its convenience.

In addition, 70% of chief executive officers plan on augmenting product personalisation through generative artificial intelligence (Gen AI) investments. The initiative is in response to the rising demand for personalised shopping experiences. According to the report, consumers want their product recommendations to be more relevant.

“As the Southeast Asian e-commerce market grows, personalisation and innovation remain critical for brands aiming to differentiate themselves. Gen AI is at the forefront of this transformation, empowering brands to create more immersive, tailored consumer experiences. This report outlines essential strategies for marketers to stay competitive and capture the opportunities presented by this dynamic market,” Saket Kumar Jha, chief revenue officer of emerging markets at Netcore Cloud, said.

Hong Kong – Alternative payment solutions are the preferred payment method for e-commerce purchases in Hong Kong (China SAR), collectively accounting for 41.7% share in 2023, according to data and analytics company GlobalData.

The report reveal that e-commerce market in Hong Kong grew by 10.5% in 2023 to reach HKD160.3b(US$20.5b), as increasing number of consumers shifted from offline to online purchases. The e-commerce market is estimated to grow by 13% to reach HKD181b ($23.1b) in 2024.

Amongst the various tools used for e-commerce purchases, alternative payments are the most preferred. They collectively accounted for 41.7% share in 2023, a trend that is prevalent in many Asian markets. This is mainly owing to factors such as simplicity, speed, and convenience.

Moreover, alternative payment solutions are followed by payment cards, which accounted for 38.6% of the total e-commerce transaction value in 2023. This can be attributed to convenience, pricing benefits such as cashback, discounts, and reward points as well as instalment payment options available with these cards.

Alternative payment solutions are followed by payment cards, which accounted for 38.6% of the total e-commerce transaction value in 2023. This can be attributed to convenience, pricing benefits such as cashback, discounts, and reward points as well as instalment payment options available with these cards.

Ravi Sharma, lead banking and payments analyst at GlobalData, said, “The e-commerce sales in Hong Kong have been growing at a robust pace, supported by the rising internet and smartphone penetration, robust online payment infrastructure, coupled with increasing consumer confidence in online transactions.”

Ravi added, “Hong Kong’s e-commerce landscape continues its upward trajectory, poised for substantial growth between 2024 and 2028, with an anticipated compound annual growth rate of 9% in transaction value to reach HKD 255.7b (US$32.7b) in 2028. Alternative payment solutions are expected to continue their growth and lead e-commerce payments in Hong Kong.”

According to the Office of Communications Authority, 96.9% of the households had broadband internet connection as of April 2024. Furthermore, online shopping festivals such as Black Friday, Cyber Monday, and Singles’ Day have also contributed to the overall growth of e-commerce in Hong Kong.

The retail industry is primed to continue its growth trajectory, with the global consumer class (comprising of consumers spending US$12 or more per day) reaching 4 billion in the previous year, and 5 billion people by 2031. In Asia-Pacific, the retail e-commerce market size is expected to grow by 8% CAGR from 2023 to 2028. These numbers reflect a growing appetite around consumer spending, but are retailers able to keep up? 

With the latest technology trends diving into how consumers’ lives continue to merge with the digital realm, personalised experiences are beginning to see even stronger demand, with 90% of businesses acknowledging that these experiences play a pivotal role in increased sales and even repeat business. However, figures show that only 35% of marketers say their customers have personalised experiences, illustrating a gap between perceptions and reality.

Personalisation – How Challenging Is It, Really? 

For retailers to even begin looking towards personalised experiences, they need valuable data and insights which they can tap into to develop their marketing strategies. However, the concrete data they require from their customers are stored in existing silos such as social media platforms or respective e-commerce sites, leaving the wider pool of retailers with a fragmented view of a customer’s behaviour, and in turn, inaccurate data.

Imagine a tailor creating a suit without considering the client’s budget, the suit’s purpose, skin conditions, or the climate it will face. This is akin to businesses ignoring key consumer insights. Without understanding these crucial factors, they struggle to offer truly customised solutions. Relying solely on partial data leads to misguided marketing strategies and product offerings that miss the mark, resulting in wasted resources and lost opportunities. Just as a perfectly tailored suit requires more than a good fit, businesses need a holistic view of their customers to deliver truly personalised experiences that resonate and satisfy.

In the competitive retail landscape, where standard data is widely accessible, retailers must differentiate themselves by offering exceptional consumer experiences and personalisation through deeper insights. Failing to do so risks leaving consumers feeling undervalued, dissatisfied, and disengaged, while competitors who prioritise up-to-date customer data will excel and dominate market share.

The Band-Aid Solution At Present 

To grasp any form of insights about consumers, retailers at present typically turn to first-party, second-party, and third-party data. First-party data, collected directly from customers, is highly accurate and compliant with privacy regulations like GDPR and CCPA, making it a reliable source. However, its scope is limited to the existing audience database, and it can become outdated if not regularly refreshed. Second-party data, shared between trusted partners, provides additional perspectives but may not perfectly align with a company’s specific needs and can also suffer from data staleness. Third-party data, quite commonly used, is often viewed as a cost-effective method for expanding audience reach, is collected from a wide array of sources across the digital landscape, including websites and social media platforms.

However, third-party data is fraught with challenges. It often contains incomplete or outdated information, making it less reliable for strategic decision-making. Additionally, it raises significant privacy concerns, as it is typically gathered without direct consent from the individuals, making it far less accurate and trustworthy than first-party and second-party data.

The Gold Standard of Data Collection

For the uninitiated, zero-party data, a term that has gained traction in recent times, is defined as information shared directly by customers, with transparency and knowledge on how their data will be used. Differentiating this from first- to third-party data, zero-party data is intentionally shared by customers themselves, delivering unmatched precision and relevance in grasping their needs, preferences, and expectations. 

Consider Lily, a fashion enthusiast who visits an online apparel site to cart out new outfits. By sharing past shopping information, and current style preferences with the site, Lily gives the company valuable insights into her interests – a prime example of zero-party data.

On a grander scale, businesses that utilise zero-party data will be able to foster healthier and more positive relationships with their customers, increasing their brand loyalty and building trust. 

Holistic Identity – What Is It? 

The Holistic Identity concept is designed to return data ownership from centralised platforms back to individuals, allowing them to securely manage, store, and share their information. This approach empowers individuals to control what they share and with whom, ensuring a unified and accurate representation of themselves are shared.

For e-commerce businesses, these solutions also streamline onboarding by enabling efficient identity verification and data sharing with a. single click, providing customers with a frictionless experience. This approach allows companies to gain deeper insights into their customers, enabling personalised product recommendations and marketing, which enhances satisfaction and loyalty.

Businesses that adopt Holistic Identity technologies into their technology stack reduce their liability by gathering only necessary customer data through zero-knowledge proof methodology, minimising the risk of data breaches, and ensure compliance with privacy regulations. 

The Future and Beyond

In today’s competitive and rapidly evolving market, businesses must be proactive in meeting consumer demands for personalisation and privacy. By leveraging zero-party data through Holistic Identity, businesses can unlock new opportunities, craft highly effective marketing strategies, and build stronger brand loyalty—all while ensuring strict adherence to privacy regulations. Embracing these advanced technologies is not just an option; it’s essential for retailers aiming to pivot effectively and lay the groundwork for sustainable, long-term growth.

This thought leadership is written by Glenn Gore, Chief Executive Officer at Affinidi

Singapore – AnyMind Group, a BPaaS company for marketing, e-commerce and digital transformation, has today announced the launch of a new feature on its platform for publishers, AnyManager, that taps on AI to enable online publishers to generate short-form videos from existing content on their websites. 

With the new feature on AnyManager, publishers can use AI to automatically extract article content and handle the entire video production process, and resulting videos can be delivered on a publisher’s own site through AnyManager Video. The new feature also supports social media formats and text-to-speech functionality, allowing publishers to distribute videos on their social media platforms.

By automating tasks traditionally performed by humans, publishers are able to create more content to adapt to changing media consumption patterns, without the need for production costs or too much additional human labor. Publishers can also have new means to reach a broader set of audiences on social media. 

This new feature is part of the recently launched AnyManager Video Player, a no-code video player that enables the distribution of video content and advertising on websites through a single ad tag implementation. AnyManager Video is already deployed globally and adopted by various publishers across Asia.

Hitoshi Maruyama, managing director of publisher growth at AnyMind Group, said, “We are constantly developing and integrating the latest technology into our platform to provide solutions that enhance publisher profitability. By utilising the newly launched AnyManager Video Player, efficient video ad generation and distribution is now even more accessible and possible. These enhanced video capabilities will continue to support the growth of publishers.”

In the futuristic sci-fi thriller Minority Report, Tom Cruise’s character walks through a shopping mall equipped with retinal scanners that immediately serve up holographic advertisements tailored to his personal needs and tastes. It’s intrusive, unnerving, yet feels incredibly believable. That day has finally come, beginning in e-commerce.

With the explosive growth of Large Language Models (LLMs), AI has become the buzzword of the decade, promising revolutionary changes across industries. Nowhere is this more evident than in the realm of e-commerce, where AI holds the tantalising promise of hyper-personalised experiences that can dramatically boost customer satisfaction and loyalty. However, as we stand on the precipice of this AI-driven revolution, it’s crucial to recognise that beneath the hype lies a landscape fraught with hidden challenges and ethical considerations.

The potential is undeniably exciting. It offers unprecedented capabilities to analyse vast amounts of customer data, identify patterns and preferences, and deliver highly tailored experiences. Through sophisticated data analysis and predictive modelling, AI can anticipate customer needs and behaviours with uncanny accuracy. This allows for real-time personalisation of content, recommendations, and even user interfaces, creating a seamless and engaging customer journey.

Natural language processing, another key AI capability, is revolutionising customer interactions through chatbots and voice assistants, making brand engagement more conversational and intuitive. AI’s ability to optimise pricing based on individual customer value and willingness to pay opens up new avenues for dynamic pricing strategies. Moreover, AI-powered sentiment analysis can gauge customer emotions, enabling brands to provide appropriate responses and experiences that resonate on a deeper level.

An Overview of AI in E-Commerce

AI plays a crucial role in enhancing personalisation across various e-commerce domains, including traditional e-commerce, social commerce, retail media, and q-commerce. In e-commerce, AI-powered recommendation systems analyse vast amounts of customer data, such as browsing history, purchase patterns, and demographic information, to provide highly personalised product recommendations that are tailored to each individual’s preferences. This not only improves the customer experience but also drives increased sales and loyalty. 

In the realm of social commerce, AI algorithms enable brands to create engaging and personalised shopping experiences by analysing user behaviour on social media platforms. By understanding individual preferences and interests, AI can deliver targeted content, product recommendations, and personalised promotions that resonate with each customer, fostering deeper connections and driving conversions.

Retail media, which refers to the use of a retailer’s owned media assets to deliver advertising, also benefits from AI-powered personalisation. AI algorithms can analyse customer data across multiple touchpoints, including the retailer’s website, mobile app, and in-store interactions, to deliver personalised ad experiences that are more relevant and effective for both the customer and the advertiser.

In the emerging field of q-commerce, or quick commerce, AI plays a crucial role in enhancing personalisation. By leveraging real-time data on customer location, purchase history, and immediate needs, AI can provide hyper-personalized product recommendations and seamless checkout experiences, ensuring that customers receive the right products at the right time, ultimately improving satisfaction and driving repeat business.

These applications paint a picture of a future where marketing becomes an almost magical experience, anticipating our desires before we even articulate them. However, this rosy vision comes with a significant caveat: the ethical implications of such powerful personalisation tools are profound and cannot be ignored.

Understanding Hyper-Personalisation Perils

The collection and use of vast amounts of personal data, essential for AI-driven personalisation, raise serious concerns about privacy and data security. The potential for this data to be misused, either through breaches or unethical practices, is a real and present danger. Moreover, the opacity of many AI algorithms creates a “black box” problem, where neither consumers nor regulators fully understand how decisions are being made about them.

There’s also the risk of creating filter bubbles, where AI-driven personalisation narrows the range of experiences and information presented to consumers, potentially reinforcing biases and limiting exposure to diverse perspectives. The use of AI in dynamic pricing, while potentially beneficial for businesses, raises questions about fairness and could lead to price discrimination.

Given these challenges, it’s clear that the path forward for AI in marketing must be one of responsible innovation. We need to strike a delicate balance between leveraging the powerful capabilities of AI and upholding ethical standards that protect consumer rights and maintain public trust.

Transparency and Responsible Use

Transparency should be at the forefront of this approach. Companies need to clearly communicate what data they’re collecting and how it’s being used. Privacy policies should be easy to understand, not buried in legal jargon. Customers should have control over their data, including the right to access, correct, and delete it. Robust consent processes and clear opt-out mechanisms for personalised marketing are essential.

Data minimisation is another crucial principle. Companies should only collect data necessary for specific, stated purposes and implement retention policies to delete unnecessary information. This not only respects consumer privacy but also reduces the risk and potential impact of data breaches.

Algorithmic transparency, while challenging to implement fully, should be a goal. Where possible, companies should provide explanations of how their AI systems make decisions. Regular audits of AI systems for bias and fairness are crucial to ensure that personalisation doesn’t turn into discrimination.

Ethical considerations need to be baked into the AI development process from the start, not added as an afterthought. This includes establishing clear ethical guidelines for AI use in marketing and ensuring diverse teams are involved in AI development to mitigate bias.

Don’t Lose the Human

Human oversight remains crucial. While AI can make rapid decisions, human supervision and review processes are necessary to catch errors, address nuanced situations, and ensure alignment with brand values and ethical standards.

Strong data security practices are non-negotiable. As AI systems handle increasingly sensitive customer information, regular updates and testing of security protocols are essential to protect against evolving threats.

Accountability needs to be clear and concrete. Organisations should assign clear responsibility for AI systems and establish processes for addressing AI-related issues or complaints. Regular ethical impact assessments can help companies understand and mitigate the broader societal impacts of their AI systems.

Education is key, both internally and externally. Staff need to be kept updated on AI ethics and best practices, while customers should be educated about how AI is used in marketing. This transparency can help build trust and enable consumers to make informed choices about their engagement with AI-driven marketing.

Collaboration with regulators and industry bodies is essential to develop appropriate guidelines and standards. As the AI landscape evolves rapidly, ongoing dialogue between businesses, policymakers, and consumer advocates is crucial to ensure that regulations keep pace with technological advancements.

The Way Forward

While the challenges are significant, there’s reason for optimism. The conversation around ethical AI is gaining momentum, with more companies recognising that responsible AI practices are not just ethically necessary but also good for business in the long run. Consumers are becoming more aware and demanding of their digital rights, pushing companies towards more transparent and ethical practices.

The future of AI in marketing is not a binary choice between innovation and ethics – it’s about finding ways to pursue both simultaneously. By embracing transparent and responsible AI practices, companies can unlock the full potential of personalised marketing while building and maintaining the trust of their customers.

As we move forward, it’s crucial to remember that the goal of AI in marketing should not just be to sell more effectively, but to create genuine value for consumers. When implemented ethically and responsibly, AI has the potential to create marketing experiences that are not just personalised, but truly personal – experiences that respect individual preferences, protect privacy, and contribute positively to people’s lives.

The path ahead is challenging, but it’s also filled with opportunity. By navigating this path thoughtfully and ethically, we can harness the power of AI to create a future of marketing that is both innovative and responsible, serving the needs of businesses and consumers alike. The journey towards ethical AI in marketing is not just a technological challenge, but a human one – and it’s a journey we must undertake together.

This thought leadership is written by David Ko, Managing Director at Ruder Finn Interactive Asia, the digital arm of Ruder Finn Asia.

MARKETECH APAC is leading the conversation on the future of e-commerce marketing strategies this 2024 and beyond with the E-Commerce Marketing in the Philippines 2024 conference on August 14, 2024 at Crowne Plaza Manila Galleria. Join us and become an integral part of a dynamic community committed to pushing the boundaries of innovation and fostering unparalleled growth in the e-commerce domain.

Data from a recent IAB research recently indicates that around 99% of APAC marketers intend to increase their retail media spend this year and retailers have finally realised they are sitting on an untapped goldmine. 

As customers adopt online shopping as the norm, marketers recognise the need to provide a personalised shopping experience and retailers are increasingly monetising access to ad spending across their websites and in-store activity.

Chemist Warehouse, an Australian pharmacy chain, recently aimed to become one of the largest advertising businesses in the country through sponsored ads on their site and in-store out-of-home screens. For a company whose traditional modus operandi was cost-effective access to pharmaceutical goods, advertising across their network now accounts for 20% of their sales. 

However, accessing retail media networks (RMNs) fluidly and at scale, remains a sticking point for marketers. Unlike advertising across the open internet – which allows a brand to access ad space across news websites, blogs, broadcast video-on-demand and music streaming apps with ease – RMNs often close their ecosystem. This is known as a ‘walled garden’. 

And while the market may become saturated with an infinite number of RMNs, their timing and power have never been more evident. Google’s impending (be it at a snail’s pace) third-party cookie deprecation is providing an added boost for retail media networks – especially as most of their USPs lie not just in their ad space, but also their valuable customer data is available for advertising use. 

Singapore-owned Carousell Group, who have premium online e-commerce space including Carousell, OneShift and Revo Financial, seized the opportunity and launched its own Shopping Ads back in 2022; collaborating with brands to acquire new customers and increase sales. Now with 58 million registered users across Greater Southeast Asia, their value to brands is insurmountable. 

For any marketer navigating this minefield, they need a ‘Swiss army knife’ of solutions.

While there’s value in utilising an RMN’s rich data – nothing is stopping a brand from creating its own goldmine. Even before engaging with an RMN, brands should be collecting and collating their own customer data. This can be as simple as starting a loyalty program, creating a newsletter or email/SMS promotions, or tracking a user’s purchase journey through a site pixel. These strategies arm a brand with information known only to them about their core customer base – allowing the brand to build audience profiles and understand who their core customer is – without solely relying on an RMN to tell them. 

Better yet, the better breeds of RMN will combine their richly sourced and proprietary customer data with a marketer’s brand in a process known as “data clean-rooming”. These data cleanrooms are safe spaces where a RMN and a brand can share anonymized and aggregated shopper data with the brand within a secure environment. Here, both parties can collaborate and supercharge their data and build better customer insights. For example, by understanding patterns and preferences in this combined data will help brands understand their ‘repeat-shoppers’, ‘vertical-based shoppers’, and ‘lapsed shoppers’ between both data sets. 

Combining data in a cleanroom also helps brands understand the missing links in the customer journey. By securely sharing anonymised transaction data, the marketer can attribute specific marketing touchpoints (such as a purchase of their product through a RMN) to build out more accurate return on ad spend, customer loyalty and lifetime value. Combining data with a RMN removes a layer of fogginess that RMN’s walled gardens can, on their own, provide.

Given the walled garden state of RMNs, marketers should also look directly outside the RMN for retail solutions. Marketers should engage with providers that can provide a multi-retail solution that doesn’t require dozens of direct deals with retailers. Off-site media platforms like Criteo’s Retail Media solution have allowed brands – such as online shopping site Welcia.com in Japan – to gain access to valuable audience segments for effective targeting, as well as transparent reporting and closed-loop measurement through their own partnerships with leading retailers. 

In Australia, Circana’s recent partnership with omnichannel media-buying platform The Trade Desk allows brands to measure the incremental impact of their cross-funnel and cross-channel campaigns across multiple retailers at once. 

In a highly fragmented and ever-growing retail market, marketers should not lose sight of traditional media buying to drive brand equity. Focusing on closed-loop solutions and sales helps to understand the return on ad spend, customer journeys, and lifetime value. But as reporting remains unhomogenized across RMNs, and the ability to advertise on an RMN remains tedious, the art of building brand equity through the open internet and traditional media buying channels – as brands have always done – should not be lost.

As marketers learn to strike a healthy balance between traditional brand building and sales-driven activity backed by retail media – retail media networks are opening fascinating and accountable ways to prove the value of a brand’s media investment. It is still, however, developed in a walled garden environment. 

Brands should be selective of which RMN aligns best with their brand, and explore less-tedious multi-retail solutions, all while not losing focus of the traditional media spends that got brands to where they are.

This thought leadership is written by Sebastian Diaz, Head of Media Innovation at Bench Media

MARKETECH APAC is leading the conversation on the future of e-commerce marketing strategies this 2024 and beyond with the E-Commerce Marketing in Malaysia 2024 conference on July 25, 2024 at Sheraton Petaling Jaya and the E-Commerce Marketing in the Philippines 2024 conference on August 14, 2024 at Crowne Plaza Manila Galleria. Join us and become an integral part of a dynamic community committed to pushing the boundaries of innovation and fostering unparalleled growth in the e-commerce domain.

Against the backdrop of the post-pandemic recovery, consumers across the Asia Pacific region have been adapting to many challenges: inflation, a cost-of-living crisis, and supply-chain-related instability of product availability, to name a few.

The pandemic has disrupted traditional in-store shopping patterns for three long years, but a recent return to a more ‘normal’ shopping environment has put into focus how much consumers driven online over that time would return to stores.

Amid the current saturated e-commerce landscape, as well as the current climate of economic uncertainty, there is therefore an even greater need for retailers to know how to better engage consumers to gain market share, particularly as consumers recalibrate their spending.

KPMG and GS1’s latest research of 7,000 consumers across 14 markets in the region reflects multiple patterns and expectations among consumer groups, but one over-riding conclusion is clear: The era of seamless commerce has arrived and while both online and offline channels remain popular throughout the region, traditional retail business models are unlikely to meet the expectations of many consumers today. Retailers and brands will have to adapt or face potential consequences of not moving with the market.

From omnichannel to seamless retail

We’re witnessing a third wave of digital disruption in the ever-evolving retail landscape. Previously, multichannel approaches—such as online and brick-and-mortar stores—operated independently within the same retail umbrella. However, the omnichannel era, fuelled by data analytics and AI, has prompted retailers to build bridges across these silos, encouraging collaboration.

Now, with seamless commerce, we’re entering a new evolutionary phase. The seamless commerce approach recognises that consumer interactions span multiple channels, blurring the lines between online and offline. To deliver a truly seamless experience, retailers must adopt an end-to-end perspective, making decisions through a fundamentally different lens. If they don’t deliver a truly seamless experience and don’t adapt their businesses to meet the expectations of the next generation of consumers, they will struggle to survive.

Innovative retailers are striving towards seamless commerce – which recognises a brand’s customer journey across multiple platforms and services, encompassing social media, delivery innovations, apps, websites, automated messaging, and other digital interactions, all seamlessly integrated within traditional physical stores.

The concept of seamless retail was fuelled by the pandemic, where consumers across all generations were driven to shop online, unable to visit physical stores due to movement restrictions. Not only did they head online to purchase food, groceries, and other essential goods, but the migration from working in offices to working from home saw demand in categories such as apparel and home furnishing.

With this shift, seamless commerce – once a differentiator – is now a baseline expectation from consumers; retailers and brands will have to adapt or face potential consequences of not moving with the market.

It’s never a one-size-fits-all in Asia-Pacific

In recent decades, the Asia-Pacific region has been at the forefront of retail transformation, notably in its early and extensive adoption of online platforms which have played a much larger role compared to the rest of the world.

Although COVID has accelerated online shopping across the region, results tell us that consumer habits in terms of how, where, and when they shop remain highly varied. On average, 45% of respondents preferred the ‘omnichannel’ approach, while in a boost for physical-first retailers, relatively few respondents said they could live with only shopping online.

In fact, the e-commerce landscape in the region is marked by a lack of a dominant platform – although various solutions and marketplaces are prevalent in individual markets. There is intense competition among platforms to capture the consumer’s dollar, and these figures identify a wide variety of products and fast, reliable delivery as two of the top three priorities for consumers when choosing a platform.

In terms of desired improvements, competitive pricing ranked as the foremost expectation in Asia-Pacific, cited by 38% of respondents, while promotions and discounts ranked third at 25%, highlighting the need for retailers to implement price strategies that ensure they remain competitive in the market.

Despite these aggregated results, the study reveals that although online is now more important than ever as a retail shopping channel, others such as livestreaming and social shopping are growing at differing rates in many locations. Marketplaces, once at the vanguard of retail transformation, are now coming under attack from new players, including department stores and other multi-brand retailers developing sophisticated, personalised platforms to recover market share they may have lost online.

More notably, a one-size-fits-all retail strategy – if ever it made sense – is becoming less and less meaningful.

How AI is shaping customer experiences and driving sales

With consumer preferences in Asia-Pacific being ever-varied, retailers are embracing AI at an unprecedented speed, resulting in improved customer experiences and increased sales.

In fact, our interviews with senior executives suggest that the adoption of AI by retail enterprises is faster than any previous technology – both at customer-facing points and behind the scenes. Analysis from Stocklytics predicts the generative AI market will hit US$1 trillion in value by 2031, representing a cumulative annual growth rate of 48.05%.

Front-of-house, AI is being used to refine customer experiences in automated chat platforms by developing a better understanding of consumer experiences and behaviour to provide more accurate responses and information.

Responses to customer enquiries can be based on relevant help centre content – directly provided within the conversation, rather than just sharing relevant FAQ responses as is typically done.

Back-of-house, AI has become an indispensable tool in functions such as demand forecasting, supply chain management, and developing marketing content. We have seen how ChatGPT has taken the world by storm, with a user base of more than 180 million people in November 2023.

There is a huge opportunity for AI to help companies understand purchasing trends – sudden spikes or drops in volume, for example – to maintain optimum inventory levels. It can contribute to significant efficiencies in sourcing, shipping, and inventory optimisation by predicting product demand, thereby mitigating issues like out-of-stock inventory or overordering. Currently, such decision-making processes may be delayed or predominantly manual, but the leverage and scalability that AI brings can greatly amplify the output traditionally managed solely by human personnel.

Incorporating seamless commerce strategies for sustainable business growth

Across Asia-Pacific, retailers who limit themselves to one channel face significant risks. Online-only retailers may lack the personal touch and might encounter difficulties in establishing reliable delivery systems, while traditional brick-and-mortar stores are not only missing out on reaching a broader audience but also on leveraging their physical presence for innovative solutions like ‘click and collect’ services or using their locations as local distribution hubs.

To meaningfully address these dynamics, focusing on a frictionless customer experience as the ultimate benchmark for measuring success is crucial. Insight-driven retailers need to utilise data and analytics to predict, strategise, and tailor their product offerings and service delivery, backed by a deeper understanding of their customers’ needs.
Technologies such as AI and Gen AI are increasingly helping retailers to yield actionable insights and interventions that improve customer experiences – from enhanced demand forecasting and customer service to optimising product availability and fine-tuning pricing and promotions.

Indeed, a seamless online-offline customer experience has now become a baseline expectation. Only by excelling in this domain can retailers expect to lead the market.

This thought leadership is written by Anson Bailey, Head of Consumer & Retail, for KPMG in Asia Pacific

MARKETECH APAC is leading the conversation on the future of e-commerce marketing strategies this 2024 and beyond with the E-Commerce Marketing in Malaysia 2024 conference on July 25, 2024 at Sheraton Petaling Jaya and the E-Commerce Marketing in the Philippines 2024 conference on August 14, 2024 at Crowne Plaza Manila Galleria. Join us and become an integral part of a dynamic community committed to pushing the boundaries of innovation and fostering unparalleled growth in the e-commerce domain.

In Asia-Pacific retail, everything is a storefront and the door sign is never turned ‘closed’. This is the reality of commerce and marketing today whereby consumers can shop for over 24 hours without leaving their homes. However, this is not to say the brick-and-mortar experience is dead; far from it in fact, but is ripe for significant transformation. 

Despite the mass explosion of digital and social media commerce, APAC consumers still enjoy the physical shopping experience. Indeed, the majority of consumers prefer to mix both online and offline shopping. Indeed, many consumers no longer even see them as separate pillars. Brick-and-mortar, e-commerce and social commerce are, in fact, just commerce. The question is, however, how do brands and marketers merge them to provide a seamless omnichannel experience to consumers?

Over the past decade, e-commerce and social commerce have exploded, with many traditional stores pivoting rapidly to meet online demand. However, the COVID-19 pandemic laid bare humans’ fundamental need for sensory experiences, especially touch. Indeed, according to a report from IBM, touch and product interaction influence the purchase decisions of over half of consumers. As a result, retailers are now increasingly re-embracing the physical shopping experience – albeit with a digital twist.

Notably, RPG Commerce Group, a direct-to-consumer (DTC) startup home to drinkware and cookware brands Montigo and Cosmic Cookware, began purely online business at the height of the pandemic lockdowns but has since ventured into physical retail. Today, it has physical stores in Malaysia and Singapore that feature interactive displays, demonstrations, personalised customer service and customised products such as engravings and hand-drawn limited editions by Malaysian artist Fawwaz Sukri.

Bistro Bytes, meanwhile, has perfected the omnichannel experience by allowing customers to mix and match orders from either in-person at various kiosks in the mall or through a single mobile application – KLIK by Keppel. 

Any retail vertical can benefit from these kinds of hybrid experiences. The trick is to find the right model that fits both the needs and interests of your target demographic and meets them at their convenience. 

The rise of ‘retailtainment’

Traditionally, storefronts have aimed to entice visitors through lavish, eye-catching window displays. But anyone who has gone and bought a bag of cookies after passing a Famous Amos store knows that humans are a highly multisensory species. Gone are the days when visual merchandising was enough to stimulate shoppers. Now, according to recent research, almost two-thirds of consumers want brands to immerse them in experiences that hit all senses.

 However, for many consumers, the physical shopping experience largely falls flat. As many as 70% of shoppers admit that they can’t recall the last time a brand excited them. That is not to say consumers no longer want to shop physically — they just want more from these spaces.

Marketers should not be surprised by these sentiments. Nobel Prize-winning economist and philosopher Daniel Kahneman famously researched that 95% of human decisions are made emotionally. A brand cannot expect to have an emotional impact on a customer without appealing to their senses.

There are multiple ways to achieve this, whether through music, decoration or signature scent. Brands like Nike notably took this to another level with the creation of its Air Max Listening Room, an immersive listening experience designed to capture the music that inspired the product.

Temporary pop-up shops are a hugely powerful tool for digital-only brands or for retailers looking to experiment with new concepts or create a buzz. Pop-up shops and augmented reality experiences can be used to deliver product information, reviews and virtual try-ons.

Marketers can achieve this by creating AR window displays in busy areas where passersby can use their smartphones to interact with products displayed, get detailed information and make purchases without entering the store. To drive conversions, marketers can pair these with an RFID tag for customers to scan to add products to their online cart and buy within a matter of clicks.

Experimenting with this type of experience can have significant brand benefits. Around 80% of retailers that set up a popup said it was a success and nearly 60% intend to do it again.

The AI revolution

Generative AI exploded into our lives less than two years ago and today it remains a top talking point for marketing leaders. Yet, most are still figuring out exactly how to use it. Marketers, technology and business leaders are still to create tangible business cases for building effective GenAI models. Moreover, many are still grappling with its safety implications. 

Nevertheless, 67% of marketers feel positive about the possibilities of GenAI and more than half of marketers are looking to invest heavily in developing A and machine learning capabilities in their business verticals.

Although still in its infancy, retail marketers can still begin exploring genAI and machine learning technology for product discovery and personalisation for consumers based on user history and first-party data. 

Marketers can begin exploring using AI-driven content creation tools to automate product descriptions and marketing copy, but at this stage, will still require a significant degree of human oversight.

Other uses include introducing AI-powered visual search functionality that allows customers to upload images and find similar products on your platform. These can sit alongside voice-activated ads for smart speakers where users can ask questions, hear detailed product descriptions and make purchases through simple voice commands.

Last, but by no means least, marketers can combine AI with AR to provide an immersive shopping experience such as using AR to try on clothes and AI to suggest other recommendations.

Culturally purposeful

Due to the proliferation of information available today, people are hyper-aware of the world around them. As such, brands and companies are held to higher standards and consumers want brands to be purposeful within their cultural context. Globally, 80% of consumers say they make an effort to buy from companies that support causes important to them. However, consumers are also discerning whether a brand is showing genuine support or is simply capitalising on a cause.

Brands are now walking a tightrope of being called out for staying silent on issues and for speaking out and appearing disingenuous. Learning how to navigate this tightrope is still a work in progress.

However, these are some tactics that can help brands take a genuine stand on social causes that matter to them. One is to create dedicated sections for products that support social causes, such as Australian retailer The Iconic’s ‘Consider’ clothing section. Marketers can track these sections with real-time impact tracking to show customers the direct results of their purchases.

Brands can also create transparency reports on sustainability efforts and social impact directly on e-commerce platforms. They can also partner with artists and community leaders to create exclusive product lines that reflect cultural heritage, offering unique stories behind each product.

Staying ahead of the competition is challenging for retailers in 2024 as new retail providers emerge regularly and attempt to undercut the market. Marketers indeed may find themselves in a heated battle between rivals, e-commerce players and even social media influencers. 

However, it is evident that consumers no longer want to simply scroll and click when they shop. The demand for physical experiences is real and marketers are now in a position to use technology to take these to the next level.

This thought leadership is written by Keith Ho, Strategy Lead at NP Digital Malaysia

MARKETECH APAC is leading the conversation on the future of e-commerce marketing strategies this 2024 and beyond with the E-Commerce Marketing in Malaysia 2024 conference on July 25, 2024 at Sheraton Petaling Jaya and the E-Commerce Marketing in the Philippines 2024 conference on August 14, 2024 at Crowne Plaza Manila Galleria. Join us and become an integral part of a dynamic community committed to pushing the boundaries of innovation and fostering unparalleled growth in the e-commerce domain.