Retail CDOs to Watch Indonesia, Philippines Markets in 2019

This year had been an interesting one for retailers. Trade wars, regulations, data breaches and aggressive moves by online retailers have made it a challenging year.

While the market was focused on the retail fortunes of China and India, two bright spots are forming at the Southeast Asia corner.

According to Forrester figures, retail CDOs and CMOs will do well to focus on Indonesia and the Philippines. Both markets are buoyed by expanding the middle class and high penetration of smartphones.

Indonesia is currently the largest market in Southeast Asia. Forrester figures show that the country accounts for 41 percent of the online retail market in the region. The research firm expects the market to grow at a CAGR of 19.6 percent from 2018 to 2023 and reach USD 19 billion in 2023.
The country's e-commerce and telco environment are still developing, offering significant potential growth. CDOs and CMOs who can tap into this potential through smartphone stand to reap dividends.

Meanwhile, Philippines is now the fastest growing market in the Southeast Asia region. It is also the second largest country by population with 53 million online adults, accounting for 51 percent of the total population.

Here, social media marketing is critical. According to Forrester, Filipinos are the most active social users in the world, spending an average of 4 hours on social media per day in 2017 – higher than even the Chinese. The research firm also expects the Philippines’ online retail market to grow at a CAGR of 30.4 percent from 2018 to 2023 as more social media users shift to buying online.

Meanwhile, Forrester sees a new battle brewing in Southeast Asia between Chinese tech giants. Alibaba, Baidu,, and Tencent are fighting it out for the region, investing more than USD 8 billion in e-commerce, logistics, and payments in the area.

Watch out for Amazon. With increasing competition in India from Walmart after the acquisition of Flipkart and investment by Alibaba, Forrester sees the global retail giant taking its time in Southeast Asia. Although it launched Prime services in Singapore in July 2017, it has been in a watch-and-wait mode for the rest of the region. But when it makes a move, it will be one that will surely create a dent in the market. 

SEA figures