Southeast Asia covers an area of 4,545,792 km2 and has 655,298,044 people as of 2019, making it the 3rd most populated region in the world (United Nations). Including 11 countries and a $3.317 nominal GDP, SE Asia is a market rich in opportunities for any brand looking to expand overseas (IMF).
Image Source: Wikimedia Commons
To penetrate such a large and complex market, we must first understand its landscape. Let’s look at the trends and driving factors that define SE Asia’s marketplace in 2022.
Southeast Asia’s transformation into a digital media landscape
SE Asia is undergoing a rapid digital transformation, fueled by growing consumer classes, an active start-up market, cheap and accessible devices, and a younger, tech-savvy population that embraces e-commerce and social media. Digital technology is revolutionizing the region.
Precipitated by the covid pandemic, SE Asia has seen a huge surge in internet users. Just in 2020, the region saw the number of internet users climb up to 463 million, a total that continues to climb today. According to the annual e-Conomy Southeast Asia report published by Google, Temasek and Bain & Co., the region’s digital economy could hit $360 billion in 2025 and reach $1 trillion by 2030.
SE Asians spend much more time online than the average global citizen, with the Philippines leading the world at an average of 10 hours and 56 minutes per day.
Driven by the younger generation, social media leads the way in digitization
A major driver of online consumption in this region can be attributed to social media.
The Southeast Asia region has become one of the world’s largest users of Facebook, and Indonesia’s capital, Jakarta, has earned the title of global Twitter capital (Asialink Business).
Malaysia leads the way in social media penetration rate at 81%, followed by Singapore (79%), the Philippines (67%), and Indonesia (59%) (eMarketer).
The digital-native youth lead the way, with young adults in the region now spending four times as much time online as they do in front of the TV screen (Datareportal).
The study further showed that 99.6% of users between 16 and 24 use social media every month, making it the number one online activity, even ahead of using search engines (Datareportal).
YouTube attracts the largest audience for this age group, with 9-10 users watching at least 1 video on the platform per month, followed by Facebook and Instagram (GWI).
Twitter attracts almost as many people in this age group as TikTok, while Facebook Messenger remains the preferred messaging platform for young adults, ahead of WhatsApp and Telegram, contrary to trends seen elsewhere in the world (Datareportal).
Smartphones are the portal to the digital landscape
One of the big drivers in SE Asia’s digitization is the rise of mobile phone use among their population. The Asian continent has the most mobile phone users globally, with around two-thirds of people using phones.
Image source: World Economic Forum
The fastest growth rates are in SE Asian countries, reflecting the developing economies taking place in the region. Singapore (87%), Malaysia (83%), and Thailand (75%) have the highest smartphone penetration, while the Philippines have the highest increase, at over 90% (World Economic Forum). Mobile data consumption in SE Asia is expected to grow threefold by 2025, from 9.2 GB to 28.9 GB per user per month (GSMA).
The rise of social commerce
As social media use and mobile penetration have increased in SE Asia, social commerce has emerged as an interesting dimension of social media consumption. With social commerce, the entire shopping process is conducted on social media platforms, from product discovery to checking out. Through social media platforms, many small influencers are acting as resellers, ordering products at wholesale prices, then promoting and redistributing within their social networks (TechCrunch).
Social commerce is growing at an accelerating rate in SE Asia, and is already worth $13 billion (TechCrunch). According to GWI data, there are 64.2 million social shoppers in SE Asia, as the the demand increases for one-stop-shop platforms (Campaign). The most used media channels for social commerce in SE Asia are Facebook (94%) and Instagram (86%) (Campaign).
Image source: Kantar Global Monitor 2019
Southeast Asia is shifting to a new model of TV consumption
Approximately 200 million people (34% of SE Asian viewers )now use online TV streaming services, according to a study conducted by The Trade Desk. The number grew by 20 million last year, and now users stream 9.7 billion hours of content per month, an increase of 22% over the past year (TTD). Furthermore, more than 22% of those using online video streaming services no longer watch traditional TV, a 29% increase from last year (TTD).
It’s worth noting that this shift has been spurred on by the pandemic, as more consumers working from home are able to binge on content at their own convenience. The same study conducted the year prior found that viewers streamed more during the pandemic (TTD). While the pandemic possibly lit the spark, we should expect to see a continued shift towards streaming services, with 73% planning to continue or increase TV streaming consumption even after the pandemic (TTD).
According to the Trade Desk study, Singapore has seen the biggest switch fro9m traditional TV at 39%, while Indonesia has had the biggest increase, at 26% in penetration. Indonesia is also the most ad-tolerant market, with 42% of viewers stating their willingness to watch four or more ads for each hour of free content. Likewise, 70% of viewers in Thailand use ad-supported platforms, compared to 58% in the region (TTD).
According to the study “Southeast Asia Online Video Consumer Insights & Analytics,” conducted by Media Partners Asia, streaming giant Netflix retains a strong lead, with 39% of premium video streaming minutes, while regional and local streaming platforms Vie, WeTV and iQIYI all compete for number two (Variety).
Driven by such platforms as Viu and newly introduced Disney Plus, content from Korea has become the top choice in Indonesia and the Philippines, surpassing both local and Western content (TTD). Meanwhile, Tencent-owned WeTV has surpassed the 1 million subscriber mark in Southeast Asia, largely due to the popularity of Chinese dramas in Thailand and local originals in Indonesia (Variety).
Challenges and developments
SE Asia’s media landscape has its fair share of challenges and developments as it transitions to digitization.
Continued retreat of media freedom
According to 2022’s edition of Reporters Without Borders (RSF)’s annual ranking of media freedom, 10 of the 11 countries that make up SE Asia rank in the bottom half. The report labeled the press situation in three SE Asian nations as “very serious,” while labeling seven more nations as “difficult.”
According to the report, the continued ebbing of media freedom highlights the growing power of authoritarian governments and “the disastrous effects of news and information chaos – the effects of a globalized and unregulated online information space that encourages fake news and propaganda (The Diplomat).”
The biggest slider was Myanmar, which ranked 176th out of 180 countries, down from 139th in last year’s survey. This slide coincides with the military seizure of power in February 2021, which has resulted in the country’s descent into repression.
Continued growth in investor confidence
SE Asia has seen an influx in major investments in the digital landscape, with such entrants as Amazon Web Services, Google, and Meta in recent years (Georgetown Journal of International Affairs). Meta, in particular, has invested in a $1 billion data center in Singapore and has three trans-pacific submarine cables scheduled to come online in 2023 and 2024. Google co-owns two of these cables jointly with telecommunication companies in Indonesia, Singapore, and the Philippines, indicating a long-term investment with plans for market expansion and increased media influence in the region (Georgetown Journal of International Affairs).
Expanding your business into SE Asia
With increased digitization driven by social media and e-commerce on mobile platforms, contrasted with challenges with media freedom, brand penetration of the SE market requires a carefully planned strategy to achieve success.
iSpider Media can help your brand optimize its online presence for audiences and relevant platforms within the SE Asian media landscape while creating localized content sensitive to local cultures and government regulations. Now is an exciting time to expand your brand into the SE Asian marketplace. iSpider Media is happy to empower your brand along the way.