As online merchants expand into new regions, like the Asia Pacific (APAC), it can be tempting to repeat what’s worked for them elsewhere.
Different markets in APAC must be unpicked to understand how to serve their unique features – everything from consumer habits to payment and banking regulations matters.
This article explains key areas merchants should focus on as they seek to create online shopping experiences and systems that can both scale regionally and resonate locally.
#1: What devices do your customers use?
Merchants plotting an m-commerce route into APAC may be frustrated by the disparities. They may find success in Indonesia where almost 4 in 5 shop using their mobile. Yet in Japan – a country with 100 million smartphone users – less than 1 in 3 say they use their devices to shop.
A look at m-commerce penetration across APAC finds it is higher in countries with relatively low GDP. In contrast, Australia, New Zealand and Singapore sit alongside Japan at the other end of the scale.
#2: Where do your customers shop?
In Singapore, Mainland China and Indonesia, most online purchases are made via a third-party marketplace on a mobile app. Yet shoppers in Australia and New Zealand are much more likely to reach for their laptop. Merchants will need to understand how this changes their products and the trade-off they are willing to make between access to more consumers and control over the whole shopping experience.
And around 25 per cent of consumers in Indonesia and Thailand buy directly within a social media platform. And any plan to engage consumers in the region should not ignore the rise of the super-apps. Though some super-apps are closed shops, others such as WeChat, Alipay, Baidu, Meituan and Tmail allow third parties to integrate their services and products.
#3: Is there a language barrier to consider?
Making a purchase is a hugely psychological experience – details matter, including language. And it matters to some more than others. For example, 76 per cent of Japanese consumers say they would not buy from a website that was not entirely in Japanese throughout the shopping and paying experience.
#4: How do your customers want to pay?
In mainland China, Australia and Thailand, digital wallets are now the most popular way to pay. Aside from the might of Alipay and WeChat Pay, popular digital wallet providers include Rakuten, Line, Samsung Pay and Kakao, Grabpay and Go-Pay. Apple Pay and Google Pay are also coming to the party in a big way.
That said, merchants shouldn’t go all-in on digital wallets. APAC is the world’s largest market for card transactions, and the big card networks such as Visa, Mastercard, JCB and UnionPay still dominate.
#5: Is there a currency and FX balance to consider?
A shopper should expect to pay in their local currency and can’t be blamed for abandoning their purchase if it’s not offered. However, this creates a tricky balancing act. The more currencies offered, the more currency conversion is required.
The answer is not to restrict the currencies made available but to control the cost of settlement. But without a unified banking infrastructure in APAC, moving money across borders – even within APAC – can be costly. And the more currencies used, the more that managing fluctuating currency values becomes a full-time job.
Find the right partner to create a localised go-to-market strategy
Few businesses have the resources or capacity to put boots on the ground in every market. That means finding a partner with access to payment methods, consumer insights, knowledge of regulations, competitive FX capabilities, and data analysis that can pinpoint opportunities and risks at a granular level – ideally all within a unified platform.
With the right payments partner, merchants can scale across the region and unlock new markets at speed yet maintain localised experiences that ensure their competitive advantage.
Visit Checkout.com to find out more.