The annual 12.12 Shopping Festival has just ended.

In China, 12.12 is only an aftertaste of 11.11, but in the Southeast Asian market, double 12 is the most popular shopping Carnival of the year.

According to public data, lazada, an e-commerce platform known as “Amazon in Southeast Asia”, set a new record in sales during the double 12 Shopping Festival, and the sales of Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam exceeded the daily sales by 30 times. The cross-border sales of the platform exceeded 300% of the turnover in the same period last year, and the order volume increased by nearly 400% year-on-year.

Although the transaction data of 2019 has not been fully settled, according to the current trend, there is still a huge improvement compared with last year. The consumption power of Southeast Asia with a population of nearly 600 million is considerable. In fact, thanks to the highly younger population structure, Southeast Asia is also regarded as an important potential market for e-commerce, mobile Internet and consumer electronics.

As for the currently popular aiot industry, we interviewed aiot Unicorn enterprises graffiti intelligence to explore how they can empower Malaysia’s largest home appliance brand pensonic, Thailand’s leading lighting brand Eve Vietnam’s national brand dawning, cherry mobile, a well-known consumer electronics technology company in the Philippines, and ACE, a subsidiary of Changyou group, the largest hardware chain channel in Indonesia, have successfully entered the fragmented and diversified smart home market in Southeast Asia.

More than 300 million young people can not eat in order to buy 3C products

If the Southeast Asian market is compared to a person, it must be a young man who is curious about new things and loves to share life with his mobile phone.

In Southeast Asia with a population of 600 million, about 50% of Southeast Asians are under the age of 30. Among them, Indonesia is one of the markets with the highest proportion of young people in the world, and people under the age of 30 account for 52% of the total population of Indonesia. These young people are highly dependent on social media such as Facebook and are keen to pursue stars, and the online red culture is popular. An unnamed senior executive stationed in Southeast Asia for many years said: “young people in Southeast Asia have to buy mobile phones even if they are hungry.”

Secondly, Southeast Asia is the region with the highest degree of mobility in the global Internet market. According to Temasek’s report, more than 90% of users use mobile terminals to surf the Internet, and more than 350 million Internet users in 2018. Compared with developed countries in Europe and the United States, Southeast Asia has directly skipped the PC era and entered the mobile era. Many young users may not have computers, but they must have smart phones. They can skillfully use all kinds of applications and are used to controlling smart homes on mobile devices.

The gap between the rich and the poor is large, and the GDP gap is 52 times

Under such excellent market conditions, the penetration rate of smart home in Southeast Asia is still low, only 2.1% in 2019, mainly due to the low level of economic development and the wide gap between the rich and the poor. The economic gap between Singapore, which has the highest per capita GDP, and Cambodia, which has the lowest, is as much as 52 times.

For example, in Indonesia, the biggest competitor of smart home is cheap manpower. Indonesian middle-class families generally employ at least two nannies with a monthly salary of only 1000 yuan, ranging from cooking to cleaning.

“However, smart home does not only serve wealthy groups. Even ordinary families with low wages should be able to improve the quality of life and reduce the time cost of human housework through smart home. This is also one of the original intentions of graffiti intelligence to promote the aiot platform. We hope to help more traditional products upgrade intelligently,” said Luo Zhijun, general manager of graffiti intelligence Asia Pacific region.

Graffiti intelligence is a global aiot platform that connects the intelligent needs of consumers, manufacturing brands, OEM manufacturers and retail chains, and provides customers with one-stop artificial intelligence internet of things solutions. Since its inception, the business goal of graffiti intelligence is to help customers upgrade intelligently.

By the end of October 2019, graffiti Smart has served more than 180000 customers worldwide, and its products and services cover more than 220 countries and regions, of which Europe, America and Africa account for more than 50%. Among them, the emerging Southeast Asian market is also a high-profile smart home market. According to statista data, the scale of southeast smart home market in 2019 was US $974 million, although the absolute amount is not high, However, it is expected to maintain a very high average annual growth rate of 30.5% in the next five years and triple that in 2023.

The Southeast Asian market not only has a huge population base, but also the popularity of household appliances in most countries is low: less than 20% of air conditioners and less than 35% of washing machines. This means that Southeast Asia has an amazing potential home appliance consumer market. Just as Southeast Asian users have crossed the PC era and reached the mobile era, with the continuous reduction of the manufacturing cost of smart appliances, Southeast Asian consumers may cross the traditional appliances and directly become big buyers of smart appliances.

However, the so-called Southeast Asian market is actually composed of 11 countries that speak different languages and believe in different religions. It is unrealistic to rely on one type to win the world. In the past, there were many examples of companies with foreign business thinking swallowing bitter fruits in the Southeast Asian market.

For example, Uber, a European and American taxi giant, lost grab in Southeast Asia. In addition to burning money too fast, it is also related to Uber’s inflexible local business strategy. When Uber launched ice cream door-to-door service, grab launched a more grounded durian door-to-door service, which is deeply loved by local consumers. Finally, when the two sides fought closely, Uber chose to withdraw from the Southeast Asian market.

“It is not easy to enter the Southeast Asian market. Unlike the retail, manufacturing or FMCG industries, smart home can directly copy the successful experience of other markets. The industrial chain is complex, local standards are not unified, Southeast Asian governments have heavy local protectionism, and local brands are also eyeing smart home… Under such a background, it is important to deeply cooperate with local brands with a soft body Only by making adjustments according to the characteristics of market segments can we effectively achieve the promotion of business objectives, “Luo Zhijun said.

There are great differences in the Southeast Asian market, but if we can work patiently and break each one, we can get rich returns.

When localism prevails, group fighting is the king’s way

However, the premise of getting rich returns is a detailed and in-depth localization strategy. In Singapore alone, there are four official languages, one Indonesia, more than 17000 islands and more than 100 nationalities. All three major religions in the world gather in Southeast Asia, and the same set of market strategy will not work.

For example, in Indonesia, where the terrain is narrow and broken, logistics distribution is a big problem. Local brands will deliver smart products to users through various “island owners”.

“We have cooperated with local brands and observed that they have been deeply involved in the local channel network for many years. They regularly distribute the products we cooperate with to the ‘island owner’ every month, and then the ‘island owner’ will transfer them to ensure that users can receive these powered by Tuya brand products. This practice is worth learning from,” Luo Zhijun said.

The prevalence of local protectionism is not only in Indonesia, but also in Vietnam. Vietnam’s per capita GDP is less than 2800 US dollars, and smuggling is rampant. Its attitude towards foreign products is that as long as it is cheap, everything is easy to say.

In contrast, domestic brands with a certain manufacturing foundation. The Vietnamese government has provided policy support and quality supervision to the local, so the Vietnamese people highly praise “made in Vietnam”. In addition, Vietnam’s economic conditions also determine that the mainstream sales channels are not large supermarkets or online channels, but small grocery stores scattered in the streets of the community.

In response to this situation, graffiti intelligence mainly seeks cooperation with local well-known brands in the early stage of business development. On the one hand, it avoids the possible impact of national sentiment, and the high-end products made by Vietnamese local brands are easier for consumers to accept and be willing to pay. On the other hand, because local brands already have a relatively mature distribution system, “taking doctrine” is more efficient than looking for distributors one by one.

This is the dawn of the largest and most influential local lighting brand in Vietnam. They are willing to access the powered by Tuya ecological platform of graffiti. The two sides work together to build smart lighting and smart city in Vietnam.

Excellent technology and flexible wrist are indispensable

Aiming North at the Philippines, which has hundreds of millions of people, the Philippines has fast economic growth and strong market potential. The younger population structure makes users have a strong willingness to spend, but the per capita GDP of 3000 US dollars gives them little spare money to spend.

“Philippine consumers may lack a budget for smart home, but they will definitely buy smart phones,” Luo Zhijun said. “So we cooperate with well-known local mobile phone brands, such as cherry mobile and infinix, to associate entry-level smart home products with smart phones, so as to speed up the speed of customers’ products entering the offline pipeline.”

According to graffiti, the intelligent universal plug-in jointly developed by graffiti and cherry mobile is one of the most popular products in the region. Philippine local electrical plugs are mainly American, but European, Japanese and other plug products also exist in the market. Consumers need universal sockets to adapt to different plugs. Smart universal plug is not only flexible to use, but also the power consumption is clear at a glance. It is a good helper to control expenditure for Philippine users who do not have rich income.

Malaysia is the third Asian country with a bilateral trade volume exceeding US $100 billion with China after Japan and South Korea. It is also one of the fastest-growing E-commerce markets in Southeast Asia. In the past, Malaysian local brands such as pensonic were often questioned to imitate Panasonic in order to build brand awareness. Now, as pensonic has become the largest local electrical brand, pensonic and graffiti have jointly launched the smart home brand t? Ush has reshaped the good reputation of innovative technology enterprises in the Southeast Asian market.

“In short, excellent technical strength and localization strategy are the two major strategies for graffiti in the Southeast Asian market. Similarly, graffiti intelligence is a few months faster than other companies. If customers don’t want to fall behind in the competition, they will give priority to cooperating with graffiti intelligence; in-depth cooperation with local brands can avoid national sentiment and local protectionism in the local market “The xenophobic pressure has also contributed to the intelligent transformation of local brands and shared the huge potential of Southeast Asia’s aiot market,” Luo Zhijun shared.

In order to deeply understand the Southeast Asian market, he has long become a flying man. It is common for him to fly between 5 or 6 countries in a month. Although it is hard, in order to conquer the fragmented Southeast Asia, he has to fragment his journey and switch his thinking at any time.

Walking on the streets of Bangkok with bustling lights, today’s Southeast Asia is not a backward developing country in the impression of people in the past. Young and explosive Southeast Asian people are becoming big buyers of the smart home industry. The smart home that takes over the smart phone may create another legend with a scale of 10 billion US dollars in Southeast Asia.

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