Japan, Singapore, and Malaysia are three of the emerging APAC markets that offer consumer brands the best online growth opportunities in 2021. Our newly launched ecommerce report on the Asia Pacific region profiled the key countries and trends that brands who want to enter these markets online–or grow their ecommerce sales–should be aware of.
Below we share some of the most important data points to understand when exploring whether these markets are right for your brand.
Japan is an attractive market for consumer brands
Though seeming to be a very technologically advanced market, online shopping penetration in Japan has lagged compared to less economically developed Asian markets, standing at only 8%. Despite this, Japan is still an attractive market for brands to sell to consumers online, and there are three online marketplaces that, between them, provide good coverage of the market.
Rakuten Ichiba is a domestic Japanese marketplace which provides a platform for third-party sellers only. Amazon is the second important player, and sells goods directly as well as allowing third-party sellers. The third is a newer entrant, PayPay Mall, which was launched by Yahoo Japan in 2019 and has taken its lead from Alibaba in combining a mobile payments app and online shopping destination into one convenient customer experience.
Cross-border shopping is not as popular in Japan as other Asian markets, and so a local entity or marketplace seller partner is ideal for brands who want to list and sell their products on any of these three marketplaces.
Emerging APAC markets: Malaysian ecommerce has government backing
The market’s ecommerce sales grew significantly in 2020–up by an estimated 24.7%–and ecommerce is one of the pillars of the Malaysian government’s post-COVID recovery plan. We expect that the shift to online shopping seen during the pandemic will only make it a more attractive place for Western brands to sell their goods online.
A connected population, increasing middle classes, and a government commitment to support the growth of ecommerce explain why it’s predicted to be the next market in the region that Amazon would want to enter. However, if Amazon does enter the market it will have stiff competition from Shopee and Lazada, who currently lead the way in terms of share of online traffic.
Singapore is a growing market for cross-border sales
Though the smallest country of those we have profiled, it is strategically important for those who want to sell online in the region. 73% of online consumers in Singapore have shopped with overseas sellers, and 35% of total online sales are cross-border. It is for this reason, Singapore has been cited as one of three emerging APAC markets.
Singapore-headquartered Shopee is the biggest online shopping site by traffic. It launched in 2015 and has used this base to expand to the other Southeast Asian markets it serves. The thinking is that Amazon may also use its base in Singapore to try to expand into other markets in the region, with Malaysia being the most likely. Lazada and Amazon are next on the list of marketplaces by traffic share, and Singapore is the only Southeast Asian market where Alibaba–which owns Lazada–and Amazon are directly competing.
Each market covered in this blog is culturally unique, at a different stage of ecommerce development, and varies in the number and spending power of their online shoppers. That said, these markets have some clear factors in common that show the region–and individual markets–should definitely be on the radar of U.S. brands who feel that they’ve maximized their growth potential in their home markets.
Contact us now to discuss how we could help to grow your Asia Pacific online sales or to learn more about how Pattern can act as your authorized partner for marketplaces such as Tmall, JD.com, Amazon, and Lazada.