How can SEA businesses expand their presence through social media?

RETAIL How can SEA businesses expand their presence through social media?

8 out of 10 consumers in the region use online platforms to find items they want to buy.

Over one billion users look for items like shoes, baby gear, cars, and apartments in Facebook Marketplace every month

Southeast Asia is leading the growth in digital transformation, with the number of digital consumers expected to reach 350 million by the end of 2021, according to the SYNC Southeast Asia Report by Facebook (now rebranded as Meta Platforms) and Bain & Company.

In terms of digital consumer spending, the average reached US$238 in 2020 and the SYNC Southeast Asia Report has seen this to grow up to 60% by the year-end to a total of US$381.

Meta has understood these figures. Having started as a social media site connecting people virtually, Meta has also transformed to allow people to sell and buy products with the Marketplace feature launched in 2016.

“Marketplace was a natural next step for us in response to how people were already interacting with each other—we first observed such activity in Facebook Groups, which only grew substantially from there,” Benjamin Joe, Meta Vice President for Southeast Asia and Emerging Markets, told The Asian Business Review.

Joe said there are more than one billion users in the Marketplace every month, looking for items like shoes, baby gear, cars, and apartments.

According to the study, 72% of businesses in Southeast Asia said social media helped them engage more with their consumers. Joe also said that digital discovery is “crucial” for consumers in the region with online channels comprising 80% of channels people use to discover items they want to buy, compared to 20% of offline channels.

The study also found that 56% use online as the primary channel for purchases, up from 46% in 2020.

Get to know the consumers

During the pandemic, the study also found that digital consumers in Southeast Asia were buying a wider range of categories at an average of 8.1 categories in 2021, which is 60% higher than the 5.1 average in 2020.

Indonesian consumers were leading in terms of the widest range of categories at 8.8, from an average of 5.1 in 2020. This is followed by Thailand with an average of 8.3 categories, and the Philippines at 8.2.

Fresh groceries, food delivery, and healthcare categories were amongst the drivers of first-time online buys, with 59%, 56%, and 52%, respectively, of the respondents purchasing them in the past three months since the survey was conducted in May 2021.

Shoppers from the region who purchase predominantly online also increased to 45% in 2021 from 33% in 2020, posting a 35% growth. The largest increases were seen in Singapore, Malaysia, and the Philippines, which rose 1.5 times higher in 2021 compared to the previous year.

Benjamin Joe

Beauty and cosmetics, clothing, footwear, and accessories are often included in consumers’ online shopping lists

For the “mostly online” shoppers, groceries, personal care, and household furnishings were the categories that saw the largest increase in purchase frequency. Beauty and cosmetics, clothing, footwear and accessories, were the categories that at least half of the respondents include in their online shopping.

The online survey involved 16,706 digital consumers–who have purchased online in at least two categories in the past three months–from various age groups, income levels, and genders in Indonesia, Malaysia, the Philippines, Singapore, Thailand, and Vietnam.

The survey was commissioned by Meta and Bain & Company provided the data analysis and modelling, according to the report.

Be part of the digital ecosystem

Meta launched the “Discovery Commerce” system in 2020, which provides an opportunity for businesses “to showcase their products and services on an online platform, anticipate shopper needs, and match products with people.”

“The ecosystem is a holistic guide that offers essential recommendations for businesses—including personalisation, creating engaging creatives, using advertising and conversion tools as well as optimisation and measurement solutions,” Joe said, adding that it helps equalise the playing field amongst large brands and online influencers and content creators.

Joe cited the situation of Singapore-based bakery Puffs and Peaks, which has been around since 2016. The store started as a passion project by business founder Jing Ting to sell her cakes online. The opening of its physical store was initially planned to be in early 2020 but it has to be delayed due to the pandemic.

“To get through the hurdle, they got customers to discover their creations via Instagram and communicate with them on WhatsApp. The business’ popularity thrived and grew even more than before,” he said, adding that Puffs and Peaks officially opened its physical store in Tampines in November 2020.

Meta also launched Facebook Shops and Instagram Shopping in 2020, which is a “mobile-first shopping experience” allowing businesses to create the online store on the said social media account for free and connect with their customers through direct messages in the platforms, including WhatsApp.

It also has a “Facebook for Business” (now renamed Meta for Business) hub that provides guidance and insights to businesses who want to expand their online presence on its platforms, Joe said.

Abide by the security policies

With transactions happening on the social media application, Meta has put in place Commerce policies for sellers on Facebook, Instagram, and WhatsApp, providing the guidelines on the type of products and services that can be offered on these social media applications.

The commerce policies include the prohibition of selling adult products, alcohol, animals, digital media, and electronic devices, amongst others, on Facebook, Instagram, and WhatsApp.

Discrimination, gambling, hazardous good and materials, human exploitation and sexual services are also not allowed in the listings of products and services, according to Meta.

Apart from these, Joe said they encourage buyers to report sellers who violate the commerce policies or community standards and they may suspend or ban sellers who do so. Buyers who file fraudulent claims against sellers are subject to consequences.

“Purchase Protections” for certain types of products, wherein buyers can file claims over their purchases with issues, are also available. Meta then will review the claim and approve the issuance of a refund for the full purchase price and delivery costs.

Buyers and sellers can leave ratings and feedback on how to improve services such as response time, friendliness, and reliability. To ensure that there will be no inappropriate content, Meta employs artificial intelligence. If a party, either a user or a buyer, violates policies on Facebook, users can opt to report the other party.

“We’re continuously exploring ways that could help people make more informed decisions on who to buy and sell with, like badges for buyers and sellers who have confirmed their identity and features that make it easier for sellers to select a nearby public place to meet in person,” Joe said.

Discovery Commerce helps equalise the playing field amongst large brands and content creators

Meta has a “Facebook for Business” hub that provides guidance and insights to businesses who want to expand their online presence on Meta Platforms