Building deeper connection with Malaysian shoppers

Industry players and experts highlight the need to reshape retail for shoppers at the Retail Asia Forum in Malaysia. 

Online shoppers in Malaysia continue to grow, presenting retailers with an abundance of opportunities. However, this growth comes with the intricate challenge of addressing the distinct needs and preferences of Malaysia's increasingly dynamic consumer base, which places a high priority on purposeful shopping. Navigating this retail environment requires a keen understanding of the evolving aspirations of Malaysian shoppers.

During the Retail Asia Forum held in Malaysia, Kenneth Soh, Head of Marketing at Shopee, underscored the imperative need for online retailers to develop a substantial online presence that speaks directly to their consumer base. This positions social media as more than just a platform; it's a crucial marketing platform for retailers like Shopee.

“We try to be essentially amenable for our brands and sellers to connect with their consumers the best they can right,” Soh said.

“[As an e-commerce platform / brand], we have to be very relatable. Aside from being present, it is imperative to be very localised in different markets to better serve customer needs,” Soh further explained.

In an increasingly digitalised market, the emphasis is on not only connecting with consumers but also making a significant impact through customised and resonant online experiences. This strategic focus on social media could very well be a game changer in the retail industry’s ongoing efforts to forge deeper connections with the ever-evolving Malaysian shoppers.

In its 2023 Consumer Trend report, Shopee found that seven in 10 Malaysians strive for smarter purchasing decisions through insightful content such as product warranty, live demos, and unboxing, whilst 32% of Malaysians intend to spend more time to destress and earn coins through shopee prizes.

The report revealed that 60% of Malaysian Buyers remain steadfast in achieving ambitions and enjoyment in e-commerce this year.

More particularly, 35% want to prioritise their personal health and wellness, and 39% plan to buy more home and living products. More than half (51%) also viewed greater personalisation as increasingly important.

Southeast Asia’s digitalisation

According to Euromonitor International, retail attained a full post-pandemic recovery in 2022, led by Indonesia and Vietnam which are the largest retail markets. E-commerce also saw a strong growth due to retailer digitalisaton and sticky purchase habits; whilst non-grocery retailers recovered with the return of international travel and social activities. 

Southeast Asia’s strong performance are being driven by three key themes, Quan Yao Peh, Senior Analyst (Channels), Euromonitor International, said – digital shopping and engagement, rethinking the store, and social and environmental sustainability.

Peh explained that effective digital engagement is a key to unlock consumer value and loyalty in a competitive online landscape. Amongst the trends that influences digital commerce development in Asia, digital engagement was cited by 53.4% of respondents. This is followed by personalised experiences (48.9%) and mobile wallets and new payment methods (48.9%). 

Retailers are also expected to prioritise improving customer experience as well as leveraging new technologies. Citing its Voice of the Industry Report, Euromonitor found that 60% have built more in-store experiences, whilst 38% added technology to enhance try-on experience. 

The Retail Asia Summit gathered interesting insights on Opportunities and Challenges in Embracing E-commerce from Euromonitor International, Shopee, and KPMG during the session moderated by Adeline Ooi, Manager, YCP Solidiance.

Moreover, more brands are implementing sustainability strategy (65%). It was also found that 74% of brands are motivated to implement such strategies due to customer perception. 

Future of retail 

The retail industry will likely continue evolving as the world moves past the pandemic, as tackled by Phang Oy Cheng, Partner – Head of Sustainability Advisory Services, KPMG, and Malik Murad Ali, Director of IT, Digital, HR and LPS, Mydin during the The Future of Retail Marketing: Trends, Technologies, and Strategies for Success. 

This continuing change gives retailers a nudge to start rethinking the role of offline stores and create a more experiential store, Cegid said. Marco Lim, Commercial Director APAC, CEGID, said this comes as physical retail have become more experiential, personalised, data-driven, socially and environmentally responsible and staff centric. 

Meanwhile, Julien Bourdiniere, Senior Partner, Consumer Goods & Retail, Asia, Roland Berger, said this gives rise to a need for retailers to reboot their business in the next five years. 

Amongst the key reasons behind this is the unprecedented rate of change businesses in Asia are facing post-pandemic. 

In particular, there is a massive shifts in consumer behaviour, acceleration of category and product innovation, digital disruption in routes to market, transformation of physical retail, and reboot of existing supply chain models. It has also become imperative to invest more in digital and data development.

Apart from this, retailers face scarcity in talents as the global labour deficit is expected to increase to 11% by 2030. 

There is also increasing pressure for companies to become more sustainable with 63% of consumers considering sustainability as a factor when making purchases. 

KPMG, similarly, highlighted the significance of incorporating environment, social, and governance (ESG) initiatives in retail strategies. 

“Unsurprisingly, close to 60% said that I don't mind spending a little bit more buying products that are much more aligned to my personal values, brands that are ethical in terms of how they produce their products,” Shahrul Kamal Kamaruddin, Executive Director, Management Consulting, KPMG, said.

“And I believe these tend to continue to evolve because you see it going outside of e-commerce,” he said, adding that ESG conversations have also started in the financial sector.

In this light, KPMG expected that purpose-led businesses with a greater focus on ESG+ will be amongst the key drivers in the future. 

Emergence of key trends 

During the panel discussion, Soh also highlighted the impact of the surge in e-commerce, especially for rural communities and small-scale sellers. He emphasised that digital technology acts as a great leveler by standardising prices and expanding accessibility for everyone, regardless of location.

This development has been particularly advantageous for sellers who previously faced limitations in growing their businesses. Now, they find themselves in a position to compete on a larger scale. This observation underscores the democratising influence of e-commerce, which not only broadens options for consumers but also empowers sellers to tap into a more extensive market.

The e-commerce platform also observed that there is a rise amongst younger and more purposeful buyers in the market.

“The values also come strongly into play in how [young buyers] make their decisions. It's about the averages—whether they resonate with the brand, whether they support the brand. How consumers relate to a brand has a significant impact on their purchasing behaviour," explained Soh.

“We believe in uplifting our underserved communities… and want to build more chances with shoppers who are deliberately shopping with us,” Soh said during his presentation.