Nataconnexindo.com,
Tangerang – Towards 2021, South East Asia has become a large
player in Digital Economy Enterprise. Internet usage in Southeast Asia (SEA)
continues to multiply, with 40M new users this year alone (400M YTD vs 360M in
2019). But even as we write this report, the region remains in the throes of
COVID-19, and its economic impact is still unfolding. Already evident, however,
is that the coronavirus has brought about a permanent and massive digital
adoption spurt, with more than 1 in 3 digital services consumers (36% of total)
being new to the service, of which 90% intend to continue their newfound habits
post-pandemic.
The adoption of digital life has become a new field
for businesses to strive for. Southeast Asians spent on average an hour more a
day on the Internet during COVID-19-imposed lockdowns, and it’s easy to see
why. The Internet sector provided access to essential goods, healthcare,
education, entertainment, and helped businesses “keep the lights on”. With 8
out of 10 Southeast Asians viewing technology as very helpful during the
pandemic, it has become an indispensable part of people’s daily lives.
This caused massive growth in Unicorns in this
region although the funding had to decline for the last two years. Since
peaking in 2018, funding for unicorns in mature sectors (e-Commerce, Transport
& Food, Travel, and Media) has slowed. Platforms are now refocusing on
their core business to prioritize a path to profitability, and are addressing
consumers’ broad range of needs through partnerships. The emerging DFS
battleground is one of the few spaces where the super-services do collide, and
though it’s too early to tell the outcome, we expect that continued funding and
strong cash-generating core business to be key.
This can easily be observed from the flooding access
to HealthTech and EdTech sector. HealthTech and EdTech have played a critical
role during the pandemic, with impressive adoption rates to match. Even so,
these sectors remain nascent and challenges need to be addressed before they
can be commercialized at a larger scale. Nonetheless, the boost in adoption,
compounded with fast-growing funding, is likely to propel innovation in this
space over the coming years.
Deal activity across the region continued to grow
unabated in the first half of 2020. Despite market turbulence, growth
fundamentals in the region remain strong and investors are cautiously
optimistic. Where the goal of years prior has been “blitzscaling”, investors
are now looking for sustainable, profitable growth. This year’s seismic
consumer and ecosystem shifts have advanced the Internet sector in unimaginable
ways, putting it in a stronger position than ever. In our 2019 report, we
identified six key barriers to growth - Internet Access, Funding, Consumer
Trust, Payments, Logistics, and Talent - and this year has seen significant
progress on most (Payments and Consumer Trust, especially). Talent, however,
remains a key blocker that all parties will need to keep working on to ensure
the momentum gained this year is sustained.
Source: e-Conomy SEA 2020: Resilient and racing ahead — What marketers
need to know about this year's digital shifts