- Young Pioneers in Asia
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- Southeast Asia #4
Hello everyone,
Belated newsletter this week as it was a public holiday here in Queensland - King’s Birthday.
Did you know that the current British monarch, King Charles III has two birthdays? His actual birthday is 14 November but it has been a three-century tradition to celebrate the second birthday in June if the original birthday is not in summer. This is because the warm summer weather allows for outdoor parades etc.
Somehow other Australian states celebrate the ceremonial birthday in June whereas Queensland and Western Australia celebrate the original birthday (more or less).
This week’s newsletter is short so I did a bit of structural changeover but I am keen to keep this engaging and consistent. First, we start with some major updates on the official TikTok ban in Indonesia which had a huge ripple effect last week. I also analysed a few YouTube videos on what food companies are doing in Southeast Asia.
TikTok ban in Indonesia
From the words of Simon Torring, Co-Founder at CubeAsia, key takeaways are as follows:
Shopee is a clear winner as they have the most similar shopper profile to TikTok Shop (as illustrated below).
Shopee and TikTok also share similar pricing dynamics that involve big discounts. Shopee has always been focused on leveraging influencers to grow its price-conscious user base.
As I mentioned in the previous newsletter, Fashion and Beauty are the dominant categories on both platforms. They make up 70+% of TikTok Shop’s GMV. Given their 5% market share in Indonesia or US$4.4B, that creates a whopping US$3B+ void in the E-Commerce market.
The prediction is that Shopee will quickly feel the void.
As a result, SEA Group's share price, which owns Shopee, jumped by 10% (36% Indonesian E-Comm market share). GoTo's share price, which owns Tokopedia has barely moved due to its lesser similarity to TikTok (35% Indonesian E-Comm market share).
Cube Asia excels in market intelligence, research, and advisory, providing unrivalled data-driven insights and tailored solutions to global brands, investors, and consultancies.
Our mission To empower organizations with actionable intelligence, targeted strategies, and unparalleled resources, driving exponential growth and client satisfaction in a competitive digital landscape.
How we work Combining innovation, collaboration, and excellence, we deliver bespoke solutions and data-driven insights, guiding strategic planning and decision-making for our clients’ enduring success.
Learning Food and Beverage trends from YouTube
Video is yet another excellent source of information. Yet, there is too much out there with questionable credibility. Rather than scrolling through YouTube Shorts aimlessly or savouring that one 30-minute video link that someone sent a few weeks ago, I will summarise a few videos each fortnight for you and share general insights.
Here are a few to kick-start this!
Video 1: Future of Food by Reuters (5:00)
Lab-Grown Seafood: A Singapore-based startup, Shiok Meats, is pioneering lab-grown shrimp and lobster. This could be a niche market for premium brands to explore.
Eco-Friendly Alternatives: Lab-grown meats and plant-based milk are gaining traction due to their lower environmental impact. Brands that focus on sustainability could find a market in Southeast Asia.
Market Research: Proper market research is crucial before entering the Asian market. Understanding consumer expectations is key.
Business-to-Business Focus: The video suggests that new entrants should initially focus on B2B rather than B2C.
Quality and Quantity: Singapore Airlines focuses on both quality and quantity. Their annual budget is US$500M or almost 2,000,000 KG of rice every year for 20 million passengers per year.
Supply Chain: To make 50,000 yummy meals every day, the video shows how logistics can be absolutely optimised in such a small country as Singapore.
General Insights
Cultural Diversity: Each country in Southeast Asia has its own unique cuisine and traditions. Brands should consider this diversity when entering the market.
Western Influence: There is an appetite for Western foods, but they need to be adapted to local tastes.
Digital Marketing: Online presence and digital marketing are essential for brand recognition. But it needs to be strategic as large investments are required for proper ROI. B2B approach is initially appropriate.
Supply Chain: Given the logistical complexities originating from the vast ocean network of the region, a robust supply chain is crucial for maintaining quality and meeting demand. To do this, you need to find the right partner to navigate the complexity.
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