Southeast Asia’s (SEA) digital economy is set to enter a new phase of growth as it hits major milestones in 2024.
The latest e-Conomy SEA report by Google, Temasek, and Bain & Company finds that the digital economy’s profits are expected to rise by 24% and cross $11 billion this year.1 Its gross merchandise value (GMV) is also expected to grow by 15% to $263 billion, as consumers continue to spend on digital offerings despite inflationary pressures.2
Another breakthrough: The transport and online travel sectors are turning a profit as their GMV surpasses pre-pandemic levels. Key e-commerce players are also looking at delivering positive earnings.
The strong performance of the SEA digital economy — with profits, revenues, and sales each posting a double-digit increase — underscores the essential role of digital services in consumers' lives. And it points towards a future of sustainable growth.
Video commerce now makes up 20% of the e-Commerce sector's GMV – a more than 4X jump from 2022.
To drive sustained, profitable growth and resonate with increasingly savvy online consumers, businesses will need to double down on digital marketing strategies.
Already, many are using online video marketing as an effective way to unlock potential profit, since shopping via video formats – or video commerce – now makes up 20% of the e-commerce sector’s GMV. That’s a more than 4X jump from 2022.3
So here are three strategies for engaging SEA’s consumers via video campaigns, based on fresh findings in the latest e-Conomy SEA report about how they shop, search, and thrive.
Reach digitally fluent consumers with full-funnel video marketing campaigns
SEA’s consumers have reached a pivotal moment of digital fluency, with the majority – up to 65% – of them now participating in the digital economy.4
That means businesses will need to update their marketing strategies and shift from prioritising first-time online shoppers to existing ones. The latter are the dominant driver of e-commerce growth, contributing up to 70% in 2024.5
And digitally fluent consumers are showing two distinctive online buying behaviours.
The online buying behaviours of digitally fluent consumers:
In 2024, consumers will, on average, make between 27 to 32 e-commerce orders – that’s respectively, 8X and 9X the three to four orders placed in 2012.6
Because the frequency of purchase has gone up and shoppers are buying across a wide range of products, including lower-priced items like groceries, average basket sizes tend to be smaller. But overall, digital spend has gone up by more than 3X. So businesses will need to win sales at every opportunity to overcome lower revenues per transaction.
SEA’s digitally fluent shoppers are also open to new offerings and exploring categories before selecting brands. Many of them use broad search terms when they’re shopping and they do not include the names of brands. Broad topic queries related to digital economy sectors have grown 1.8X between 2020 and 2024.7
So to get consumers who’re exploring multiple options to choose your brand, you’ll need to stay present throughout their purchase journey. That means connecting with them across the entire funnel on platforms where they are, like YouTube, which 86% of SEA consumers turn to when using video to research purchases.8
YouTube’s influential creators can help your brand win awareness among new audiences, and its AI-powered marketing campaigns like Demand Gen can drive engagement across immersive surfaces including YouTube, Discover and Gmail.
By adding Demand Gen to your lower-funnel ads campaigns like Performance Max and/or Search, you can further boost results. On average, advertisers that did this saw 14% more conversions.9
When Vietnamese milk brand GrowPlus+ wanted a marketing solution that would boost its sales across the entire funnel, it turned to YouTube. To raise awareness of its products, it collaborated with 20 family content creators to create tutorial-style Shorts on childcare, which attracted 5.8 million views, likes, shares, and comments.
It then drove engagement and conversions by pairing Demand Gen and Performance Max, resulting in a 2X increase in brand consideration versus the benchmark, and 2X more purchases.
Engage shoppers with relevant video content that satisfies their search
Along with increasing digital fluency, shoppers’ search behaviours are evolving, and this lets brands drive deeper engagement.
For one, they’re making increasingly specific searches — digital economy sector searches involving four or more words have grown 2X between 2020 and 2024.10
They’re also seeking locally relevant content. Searches about SEA digital economy sectors that are made in local languages have grown 1.4X from 2020 to 2024.11
How SEA shoppers search online:
And they’re increasingly finding their searches satisfied by online videos, especially those created by YouTube’s diverse ecosystem of creators.
Online creators offer localised content across all digital categories, with as many as 88% of them posting videos in their native languages.12 So partnering with YouTube creators to create highly relevant ads can be a great way for brands to engage shoppers, 43% of whom used video for product discovery, research, and transactions in 2023.13
Indonesian mineral water brand Aqua, for example, wanted to boost engagement with young Indonesians. So it tapped YouTube – Gen Z Indonesians’ favourite mobile app for watching videos.14 Leaning into Shorts’ huge traction among these youth, Aqua sponsored eight creators’ Shorts on the #YukTebarBukBerCheck trend for breaking fast.
The Shorts showed the creators breaking their fast by drinking Aqua, inspiring viewers to do the same and post their own Shorts with the tag #AQUADULU.
That opened a flood of engagement. After 30 days, Shorts tagged with #AQUADULU garnered 33 million views, 31% of which were from Gen Z. The campaign also drew over 9,000 Shorts creations.
Win video commerce customers with ‘shoppertainment’
Besides meeting consumers’ needs and interests, marketers must also engage them with what they love: entertaining, immersive video shopping experiences.
Brands are already using shoppertainment content to showcase products, either on their own video channels, with creators, or via live shopping.
One way to gain video commerce traction is by tapping the YouTube Shopping affiliate program. This program, in partnership with Shopee, enables brands to partner with creators to seamlessly integrate their products into YouTube content across videos, Shorts and livestreams. It’s now available in Indonesia, Vietnam and Thailand.
As SEA’s digital economy continues to grow, businesses can lean into video commerce to win sales and customers. And YouTube is the place to win the digitally savvy shoppers driving SEA's next lap of growth.
Contributors: Stephan Wu, Industry Analytical Head, Digital Natives; Ibrahim Shahid, Principal Analytical Consultant; JeeSoo Lee, Senior Analytical Consultant; Mike Koh, Principal Analytical Consultant; Nikki Del Gallego, Principal Analytical Consultant
