7 in 10 SEA online sellers expect growth in 3Q

52% of the 750 sellers surveyed experienced growth in H1.

Seven in 10 Southeast Asian online sellers are optimistic that they will experience more growth in the third quarter, according to Lazada’s Digital Commerce Confidence Index.

Lazada said of the 750 sellers surveyed in the Philippines, Indonesia, Thailand, Vietnam, Malaysia, and Singapore, 52% experienced a “high level of growth” in the first half of 2021, with 70% expecting additional growth of more than 10% in the third quarter.

Of the 70%, a third of them were confident that their sales volume would surge by more than 30%, resulting in an overall index score of 64 for being “optimistic,” zero being “very pessimistic,” and 100 being “very optimistic.”

Lazada cited as a key driver to sellers’ optimism the significant shift in Southeast Asian consumers’ consumption habits, with more resorting to online purchases due to the pandemic.

Developing a unique differentiated offering, initiating more user traffic and harnessing data insights were also identified by sellers as “key enablers of online business growth.”

“Many SMEs have embraced new technology and acquired digital capabilities to transform and future proof their businesses. Despite the challenging health situation and ongoing challenges, our index shows that sellers remain both resilient and optimistic about the future,” said Lazada's Chief Strategy Officer Magnus Ekbo. 

Whilst strong growth momentum was seen across all retail categories, sellers from electronics and fast-moving consumer goods categories were the biggest beneficiaries of a stay-at-home economy, with 53% reporting that their business recorded strong growth in the first six months of the year.

The fashion segment also made “the biggest leap of faith” with 75% expecting improvement in the third quarter and almost 40% expecting more than 30% growth even though 48% said their business improved in the first half of the year.

Roshan Raj, partner of Redseer, said vaccination programmes have had a significant effect and platforms have seen fashion rebound with more than 70% growth in the second quarter from the first quarter in some categories, mostly apparel.

Raj cited live streaming which has been a “big boost” to many sellers as it creates an interactive environment but noted that "the expectations from fashion sellers might see some moderation in the near future" with the recent surge of COVID-19 infections in the region.