Hyper-personalised shopping rules in Southeast Asia

Data and analytics allow brands to optimise customer experience both online and in-store.

Consumer demand for a hyper-personalised retail experience is intensifying competition in Southeast Asia's retail market, where shoppers now look for tailored clothing designs and colours, travel advice, and even lifestyle recommendations.

Retailers and brands are boosting their digital strategies using data and artificial intelligence (AI) to meet higher expectations and differentiate themselves in a crowded market, Vivek Sharma, consumer industry technology and transformation leader at Deloitte Southeast Asia, told Retail Asia.

“For example, a leading retailer in Singapore took the lead in driving multiple digital initiatives through its app and personalised loyalty programs,” he said. “We have seen that Southeast Asian consumers prefer brands offering personalised experiences, which boost customer retention rates in competitive markets.”

Vivek said data and analytics allow brands to optimise omnichannel customer experience in both their online platforms and in their-physical stores. Generative AI (genAI) has further transformed consumer interactions by enabling personalised communications at an unprecedented scale across ads, media, and customer service, he added.

He said genAI adoption would continue to accelerate as brands focus on maximising customer satisfaction and reach, whilst enhancing operational efficiency at scale.

Social commerce is also surging, particularly amongst younger generations. In Indonesia, for example, six of 10 Gen Z consumers report shopping directly through social media platforms, reflecting a broader regional trend in digital engagement.

The “impatience economy” is another force reshaping the retail landscape, with demand for quick, convenient services driving the rise of “quick commerce” in major Southeast Asian cities. A growing appetite for rapid delivery is pushing retailers to invest in micro-warehousing, dark stores, and last-mile logistics to meet demand.

Vivek added that, with the evolution of eCommerce, retailers should optimise product-channel strategies across various  archetypes to maximise growth.

Despite the imperative for digital transformation, many Southeast Asian companies face hurdles in integrating legacy systems with modern technology, leading to fragmented operations. Vivek noted that over 50% of Deloitte’s clients have identified dated systems as a significant barrier to their digital transformation.

The region also has a skill gap in data and digital expertise, hampering the speed and effectiveness of digital initiatives. Company culture is another challenge, as organisations face resistance to changes, including the push to embrace agility and experimentation. “More than half of transformation efforts fail due to a lack of organisational buy-in and change management, which needs to be driven top-down,” he pointed out.

Vivek also said there is an increasing demand for a seamless omnichannel experience. “Consumers expect a cohesive experience between online and offline channels, including options like click-and-collect and support for multiple digital payment methods.”

Nearly half of Southeast Asian shoppers would abandon brands that fail to meet their expectations for convenience and immediacy, he added.

To succeed in today’s market, brands must ensure consistent messaging, pricing, and customer interactions across all platforms. They should also invest in unified data platforms, ensure consistent brand messaging, and offer flexible delivery options, Vivek said.

Amongst the key forces identified by Deloitte to shape the future of the consumer industry, Vivek noted that there is an increase in adoption of technologies such as generative AI, augmented reality, and virtual reality in brand-to-consumer interactions.

Meanwhile, more companies are adopting sustainable practices in response to rising consumer expectations about climate change and waste reduction, Vivek said. Shifting policies and cyberthreats highlight the importance of data privacy and transparency in an increasingly digital world, he added.