SEA digital bizs shift focus to monetisation to turn profitable: Study

E-commerce, travel, transport and media contributed $70 billion in revenue. Remarkably, the focus on monetisation has not come at the expense of consumer engagement and GMV growth, the research revealed.

The top 30 per cent of SEA spenders account for more than 70 per cent of digital economy spending.

Digital adoption in the region continues to rise even today, albeit at a slower pace than the steep acceleration seen at the height of the pandemic.

A distinct trend of SEA’s digital economy is that e-commerce follows an S-shaped growth curve, in which it continues on its growth trajectory, but from a higher starting point after the steep acceleration during the pandemic.

Consumers in the region are adopting digital financial services (DFS) at a rapid pace. Cash is no longer king, as digital payments now make up more than 50 per cent of the region’s transactions.

The SEA digital economy is expected to produce 20 metric tonnes (MT) of emissions by 2030—significant, albeit an order of magnitude lower than other environmental impact-intensive sectors.

Digital players have been rolling out reducing and recycling initiatives, but more can be done to further lower impact by up to 30-40 per cent over time, the report noted.

On the social front, the digital economy has created 1.6 lakhs high-skilled jobs and indirectly supports nearly 30 million jobs, while platforms have enabled over 20 million merchants to grow their businesses online. Concerns exist, nonetheless, around the welfare of worker-partners, necessitating dialogue between institutions and platforms.

Charting the course for the digital decade SEA’s ‘digital decade’ has just begun. The course to exceed $300 billion by 2025 depends on the shape of recovery amid today’s uncertainties, while the path to a $600 billion-$1 trillion digital economy in 2030 remains geared on SEA’s economic fundamentals.

High interest rates are tailwinds to deposits and wealth management but pose challenges to lending. Non-performing loans remain under control. Sustainable business models are emerging among pure-play fintechs, while traditional financial companies are accelerating the process of digitalisation to retain user, according to e-Conomy SEA, a multi-year research programme launched by Google and Temasek in 2016.

Bain & Company joined the programme as lead research partner in 2019.

Fibre2Fashion News Desk (DS)