Non-Capital Areas in Southeast Asia See An E-Commerce Boost During COVID-19

Jun 10, 2020

(Click here to download HD version of this infographic)

With movement being restricted across the world, more consumers are turning online to purchase essentials, prepare for stay-home life or otherwise indulge in some retail therapy. 

Several studies have shown a growth in e-commerce over the last few months, but has this growth been consistent across all cities? 

We’ve seen a common thread in our previous infographics. Capital cities of each country accounts for a significant proportion of a country’s e-commerce shipments despite only making up a proportionately smaller percentage of a country’s population.  

We asked ourselves – how are cities and states outside of capital cities in Southeast Asia faring? Are they experiencing a similar surge in demand for e-commerce from the pandemic? 

In this latest infographic, we looked into the growth rate of e-commerce shipments to Indonesia, Thailand and Malaysia across non-capital areas and capital cities. 

Encouraging trends on e-commerce shipments across the 3 countries

Comparing shipment volumes before & during COVID-19, we found: 

  1. Indonesia: Shipments to destinations outside of Greater Jakarta grew 14.7% faster than in the capital.

  2. Thailand: Shipments to destinations outside of Metropolitan Bangkok grew 13.0% faster than in the capital.

  3. Malaysia: Shipments to destinations outside of Greater Kuala Lumpur grew 11.9% faster than in the capital.

Zooming into the respective countries: 

In Indonesia, we see the rise of  “a new cohort of consumers during the pandemic” which has boosted the country’s e-commerce growth trajectory. Whilst the e-commerce market outside Jakarta may be relatively less mature, non-capital cities account for 85% of Indonesia’s population.

With these areas also experiencing strong e-commerce growth, there’s a significant untapped opportunity for both local e-commerce platforms and overseas companies looking to expand their presence beyond Greater Jakarta. 

Our previous study on Thailand shows its capital city (i.e. Bangkok) accounted for almost half of all shipment deliveries in 2019 despite making only a  quarter of the total population in Thailand. 

We’re watching to see if this trend continues after the gradual relaxation of lockdown and movement control measures post-COVID-19, and how this percentage might shift in the later half of 2020. 

Finally, in Malaysia, statistics showed that online commerce made up only 5.5% of the total retail sales in Malaysia last year. 

However, with measures such as the Movement Control Order (MCO) in Malaysia, Statistics Department chief statistician Datuk Seri Dr Mohd Uzir Mahidin expects the online retail scene to expand even further as more consumers move towards e-commerce. A study by Janio also found that 60% of respondents were making more online purchases than usual during this period. 

Seeing new opportunities for e-commerce retailers post-COVID-19

From social distancing measures, movement control orders to global supply chain shocks, the impact of the COVID-19 pandemic on the retail industry has been immense. Yet, we see encouraging signs as behaviour patterns and business models work to adapt.

Traditional brick and mortar stores and retail shops steadily moved online to cater to new consumption patterns as more consumers shop from home. 

This in turn created a positive impact on the e-commerce logistics industry with higher demand and increased parcel volumes across multiple countries. 

With the rapid growth of e-commerce in non-capital cities and the expansion of delivery services to rural areas, this opens up new possibilities for e-commerce retailers to expand further across the country. The e-commerce industry should start preparing ahead to meet the increasing demand from consumers across the country. 

Research methodology: Parcel Monitor’s team analysed representative domestic parcel shipment data in Indonesia, Malaysia and Thailand from Jan to May 2020.

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