The Role of Artificial Intelligence is Logistics, Thailand vs Asian Countries

In 2022, global e-commerce sales are expected to exceed USD 5 trillion for the first time, accounting for 1/5 of overall retail sales. Fast-growing emerging markets will return to the top in e-commerce sales growth, overtaking more established national markets such as Canada, Singapore, the Netherlands, and Russia. In 2025, this figure is expected to exceed USD 7 trillion.

The growth of e-commerce sales will slow down significantly. Global e-commerce sales are expected to increase by 12.22% in 2022. While this is slightly lower than the figures for the last two years, the 12.22% increase still means that USD 603.68 billion more will be spent online in 2022 than in 2021. It is the most significant increase on record. Emerging economies will be rejuvenated by the rapid rise of e-commerce markets locally.

Online shoppers have easy, fast, and equal access to all goods, and they have the freedom to browse seamlessly between a wide range of platforms, products, prices, payments, and delivery options. Asia produces over 50% of all global e-commerce sales with developed markets like China, South Korea, and Japan. As a pioneer e-market, China accounted for almost a quarter of the total retail sales of consumer goods in 2021, with the younger generation driving involvement. Yet, there is a “grey e-commerce generation” emerging across Asia with a high online adoption rate, with 60% more older online shoppers in Indonesia and 64% in Thailand in 2021 than at the end of 2019.

The rise of online shopping has increased the demand for last-mile delivery options. Customers want faster shipments at a lower cost. Many customers are ready to pay extra charges for fast delivery. However, COVID-19 has pushed customer expectations even higher. The old model consisted of shipping for a handful of strategically placed distribution centers around the country. In an era of e-commerce explosion, companies need to respond by developing an omnichannel fulfillment model. This requires investment in real estate and more staff since a last-mile delivery strategy is a key to e-commerce shipping success.

The online shopping experience ends only when the shopper has the desired purchase. Delivery is the final stage of online shopping that contributes significantly to the overall experience. Since the pandemic started two years ago, South East Asia (SEA) has seen an increase of approximately 70 million online shoppers. The number is expected to reach 380 million by 2026, according to the e-Commerce Barometer 2021 Report by Ninja Van and DPD Group.  According to the report, 80 % of SEA shoppers prefer to have their purchases delivered directly to their homes, with deliveries to their workplace ranking second, and more than 50% of SEA consumers made cross-border purchases, such as those in China, Hong Kong, Taiwan, Japan, and South Korea.

SEA shoppers also expressed a strong desire for real-time tracking of their parcels, as such tools allow them to access details regarding their parcel shipments, including their statuses and even the estimated delivery time. In addition, SEA buyers often want to know the delivery company’s name. 56% would like to choose one which guarantees a good service. 51% turn to which offers reassurance. 38% want environmentally friendly delivery alternatives. 35% prefer their accustomed company; the remaining 35% have had a previous bad experience and want to avoid it.

              

Online shoppers want their parcels delivered to their home addresses. Real-time delivery tracking is one of the critical delivery preferences. The appetite to purchase from foreign websites looks to grow in the future. It is an opportunity for shippers to be regional players. However, resolving delivery issues is still essential to maximize this opportunity.

Article by: Asst. Prof. Suwan Juntiwasarakij, Ph.D. & MEGA Tech