China and India are currently the darlings of global e-commerce, boasting the world's fastest-growing markets, but a third Asian market could join their ranks in the coming years.
The six major economies of the Association of Southeast Asian Nations (ASEAN) – Singapore, Malaysia, Indonesia, Thailand, the Philippines and Vietnam – are benefiting from strong fundamentals that will soon bring them into focus internationally, industry experts say.
Online retail revenues among the six nations are expected to rise to $34.5 billion by 2018 from $7 billion in 2013, according to Frost & Sullivan.
"As purchasing power increases, internet penetration spreads, and online offerings improve, online retail in ASEAN markets could grow as much as 25 percent annually," said a joint- report from consulting firm A.T. Kearney and CIMB Asian Research Institute last month. The report notes that the region has already enjoyed 15 percent annual growth in the past four years.
Moreover, ASEAN is home to some of the biggest smartphone markets in the world – a key advantage given mobile devices account for 40 percent of global e-commerce transactions, according to a February report from Criteo.
In Indonesia, the world's fourth-most populous country, smartphone penetration is around 23 percent, compared with 18 percent in India, Nielson data shows. In more developed economies like Singapore, that figure jumps to 85 percent – the highest rate in the world.
"Right now, there's more of a business-to-consumer (B2C) trend in ASEAN," said Clement Teo, senior analyst, at Forrester Research, over the phone. "But over time, as people become more confident, the market could grow into a consumer-to-consumer (C2C) model like China."