The eCommerce revolution has taken the world by storm, both East and West. The pandemic brought many shoppers online and away from physical stores, but this trend was strong even before COVID-19. According to Statista, 24% of China’s, 17% of Taiwan’s, and 16% of South Korea’s retail sales are made online, and these numbers will continue to rise.
Data has been the key to the Asian eCommerce revolution. Data-driven solutions provide a virtuous cycle--the more consumers shop online and discuss their purchases through reviews and status updates, the more consumer data is ripe for collection. Alternative data collection is done through data crawling, scraping, and it is analyzed to create actionable consumer insights.
How Much is eCommerce Growing in Asia?
Many Asian populations have been enthusiastic early adopters of technology, including mobile and apps, in some cases, faster than in the West. In Asia Pacific countries, the number of mobile subscriptions outstrips the population. Mobile devices in many areas are the primary way Asian consumers browse for products, make purchases, and communicate about their shopping habits.
Online sales in Asia were strong before the pandemic but have grown stronger ever since. In 2017, Asia accounted for 40% of worldwide online sales. The pandemic kicked this eCommerce trend into high gear.
According to Alon Ghelber from Forbes, “Businesses that can embrace digital transformation on time can actually benefit from the pandemic.” Since so many consumers in Asia were already online, the rise in eCommerce in the East was inevitable.
Sales on Shoppee, one of the leading Asian eCommerce platforms, increased by 74% and reached $6 billion by the first quarter in 2020. A shopping festival in Shanghai, China, raked in $2.2 billion in 24 hours. Banks and credit card companies in Asia make it easier for small merchants to sell their wares online with partnerships like Visa in Hong Kong’s alliance with eCommerce platform Boutir.
Major platforms such as Lazada and Shopee continue to dominate the Asian eCommerce market. Lazada, launched in 2012, serves Singapore, Malaysia, Indonesia, Philippines, Singapore, Vietnam, and Thailand.
Lazada hosts over 155,000 merchants and sells to 560 million customers in the South Pacific Asian region.
However, Lazada was recently surpassed by Shopee, backed by Tencent. Shopee took a page out of Lazada’s book and improved upon it with a mobile-centered and data-driven, customer-centric approach that encourages brand loyalty.
What is Driving the Asian eCommerce Growth?
The driving force behind the growth of Lazada, Shopee, and other players in the Asian eCommerce market is data. Specifically, alternative data is produced from user-generated content such as social media updates and reviews.
The more time consumers spend online, the easier it is to understand their habits, preferences, pain points, and what features and products they want to see. The raw material for alternative data can be found everywhere online.
What is Alternative Data and How is it Used?
Alternative data is derived from user-generated content. When someone writes a review of a product or posts on social media about a night out at a restaurant and describes the food or the service, these are examples of user-generated content that can be used to produce alternative data.
There are many reviews and social media mentions of products and brands. Collecting and reading all of them may not seem possible. Fortunately, there are web crawling and scraping tools that help marketers locate mentions of brands and products.
Scrapers retrieve texts through lifting HTML code. Analytics tools determine the attitude of the text towards the brand. The result is actionable alternative data.
Alternative Data Strategies
Alternative data refine business strategies, including product development, customer service, and marketing. If customer reviews indicate that most customers would prefer a broader selection of colors for ballet shoes, companies can respond to these requests.
If sentiment analysis indicates that customers are not happy with specific questions asked by customer service callers or chatbots, those questions can be eliminated or revised.
Customer feedback from alternative data can inform companies if pricing is a pain point or if an ad campaign didn’t seem to grab them. Alternative data points the way to making improvements and doubling down on products and services customers like.
The Power of Data in the Asian eCommerce Market
Asian eCommerce platforms leverage customer data to drive sales, customer retention, and brand awareness. The widespread use of mobile in Asia provides a wealth of data for eCommerce. Discovering preferences and customer buying habits is the first step towards generating alternative data that drives the eCommerce boom worldwide.
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