With 350 million digital consumers, Southeast Asia is set to leapfrog China to become the fastest-growing digital economy in Asia-Pacific.
So, the most successful brand owners and platforms need to focus on strategies to both capitalize on a post-pandemic digital boom in the region and insulate themselves from ensuing digital disruptions.
Digital consumption in SEA is increasing faster than in other Asia-Pacific regions, according to research conducted by Bain & Company and Facebook. Digital shopping in the region now outstrips China at a 1.6x growth rate. In Southeast Asia, 78% of consumers are now digital consumers (those who performed a commercial transaction online).
The number of new digital consumers added in one year in Singapore, Malaysia, Indonesia, Philippines, Thailand, and Vietnam is equivalent to the population of the entire United Kingdom.
A Shift in Quality is Required for Digital Marketing in the ASEAN Region
Immense value continues to be a baseline criterion for 44% of SEA digital consumers. However, providing better quality is the key to driving a brand switch and subsequent repurchases.
In addition, to differentiate and garner future loyalty, companies need to focus on positive buying experiences, value adds, and multi-point connections throughout a brand ecosystem.
The tailwinds driving the growth of the digital advertising market in Southeast Asia are:
Ad spending in the Digital Advertising market is projected to reach $9.84bn in 2023.
The market’s largest segment is Search Advertising, with a market volume of $3.59bn in 2023.
In global comparison, most ad spending will be generated in the United States ($297.40bn in 2023).
The average ad spending per user in the Social Media Advertising segment is projected to amount to $7.78 in 2023.
In the Digital Advertising market, 57% of total ad spending will be generated through mobile in 2027.
In the Digital Advertising market, 89% of the Digital Advertising revenue will be generated through programmatic advertising in 2027.
This massive digitalization has fuelled the need for data centers. The data center market in Southeast Asia is growing significantly, with multiple investments in Singapore, Indonesia, Malaysia, Viet Nam, the Philippines, and Thailand.
The Time is Right for Growth
Southeast Asia is among the fastest-growing digital markets worldwide. Internet usage and social media trends have increased the demand for faster internet networks and data centers to store data generated by them. Three out of five people in Southeast Asia are active social media users, with Malaysia having the highest penetration rate of 86%, according to a report by HKTDC Research.
In 2021, the digital advertising market in Southeast Asia was valued at around $10.53 billion. Estimated to grow at a CAGR of 18.7%, the region’s market was projected to reach around $58.63 billion in 2031.
This is a market ripe for the picking!
