How can SEA businesses expand their presence through social media?

8 out of 10 consumers in the region use online platforms to discover items they want to buy. 

Southeast Asia is leading the growth in digital transformation, with the number of digital consumers expected to reach 350 million by the end of 2021, according to the SYNC Southeast Asia Report by Facebook and Bain & Company.

In terms of digital consumer spending, the average reached US$238 in 2020 and the SYNC Southeast Asia Report has seen this to grow 60% by the year-end to US$381.

Facebook has understood these figures. Having started as a social media site connecting people virtually, Facebook has also transformed to allow people to sell and buy products with the Facebook Marketplace feature launched in 2016.

Marketplace was a natural next step for us in response to how people were already interacting with each other—we first observed such activity in Facebook Groups, which only grew substantially from there,” Benjamin Joe, Facebook vice president for Southeast Asia and Emerging Markets, told Retail Asia.

Joe said there are more than one billion users in the Marketplace every month, looking for items like shoes, baby gear, cars, and apartments.

According to the study, 72% of businesses in Southeast Asia said social media helped them engage more with their consumers. Joe also said that digital discovery is “crucial” for consumers in the region with online channels comprising 80% of channels people use to discover items they want to buy, compared to 20% of offline channels.

The study also found that 56% use online as the primary channel for purchases, up from 46% in 2020.

Digital ecosystem

Facebook launched the “Discovery Commerce” system in 2020, which provides an opportunity for businesses “to showcase their products and services on an online platform, anticipate shopper needs, and match products with people.”

“The ecosystem is a holistic guide that offers essential recommendations for businesses—including personalisation, creating engaging creatives, using advertising and conversion tools as well as optimisation and measurement solutions,” Joe said, adding that it helps equalise the playing field amongst large brands and content creators.

Joe cited the situation of Singapore-based bakery Puffs and Peaks which has been around since 2016. The store started as a passion project by business founder Jing Ting to sell her cakes online. The opening of its physical store was initially planned to be in early 2020 but it has to be delayed due to the pandemic.

“To get through the hurdle, they got customers to discover their creations via Instagram and communicate with them on WhatsApp. The business’ popularity thrived and grew even more than before,” he said, adding that Puffs and Peaks officially opened its physical store in Tampines in November 2020.

Facebook also launched Facebook Shops and Instagram Shopping in 2020 which is a “mobile-first shopping experience” allowing businesses to create the online store on the said social media account for free and connect with their customers through direct messages in the platforms, including WhatsApp.

It also has a “Facebook for Business” hub which provides guidance and insights to businesses who want to expand their online presence on its platforms, Joe said.

Security features

With transactions happening on the social media application, Facebook has put in place Commerce policies for sellers on Facebook, Instagram, and WhatsApp, providing the guidelines on the type of products and services that can be offered on these social media applications.

The commerce policies include the prohibition of selling adult products, alcohol, animals, digital media, and electronic devices, amongst others, on Facebook, Instagram, and WhatsApp.

Discrimination, gambling, hazardous good and materials, human exploitation and sexual services are also not allowed in the listings of products and services, according to Facebook.

Apart from these, Joe said they encourage buyers to report sellers who violate the commerce policies or community standards and they may suspend or ban sellers who do so. Buyers who file fraudulent claims are subject to consequences.

“Purchase Protections” for certain types of products, wherein buyers can file claims over their purchases with issues, are also available. Facebook then will review the claim and approve the issuance of a refund for the full purchase price and delivery costs.

Buyers and sellers can leave ratings and feedback on how to improve services such as response time, friendliness, and reliability. To ensure that there will be no inappropriate content, Facebook employs artificial intelligence. If a party, either a user or a buyer, violates policies on Facebook, users can opt to report the other party.

“We’re continuously exploring ways that could help people make more informed decisions on who to buy and sell with, like badges for buyers and sellers who have confirmed their identity and features that make it easier for sellers to select a nearby public place to meet in person,” Joe said.

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