Amazon Targeting $240 Billion Southeast Asian Market
Amazon’s interest in the promising Southeast Asian Internet market is growing, as shown by its talks to acquire a stake in Indonesia-based Gojek.
Sept. 10 2019, Updated 8:26 a.m. ET
On August 28, The Wall Street Journal discussed Amazon’s (AMZN) ongoing talks to acquire a stake in Indonesia-based Gojek. Gojek’s “Super App” provides on-demand transport, payment, and food services by connecting customers to motorbike riders. Other Southeast Asian markets Gojek is present in include Vietnam, Singapore, and Thailand.
Gojek’s gross transaction value surpassed $9.0 billion last year. Amazon’s interest in the startup highlights its growing interest in the promising Southeast Asian Internet market.
According to Google and Temasek, the Southeast Asian Internet economy has hit an inflection point. By 2025, they expect it to be worth $240 billion. Google and Temasek expect the e-commerce, online travel, online media, and ride-hailing spaces to be worth $102 billion, $78 billion, $31 billion, and $29 billion, respectively. Meanwhile, Forrester expects the market to be worth $53 billion by 2023.
Amazon’s foray in the Southeast Asian market
In July 2017, Amazon launched its two-hour delivery service, Prime Now, in Singapore. And in December 2017, the company launched its Prime membership program in Singapore. Furthermore, in March 2018, Amazon entered Vietnam’s e-commerce market. It offers services for the Vietnam E-commerce Association.
Competitors are going strong in Southeast Asia
According to CrescoData, Alibaba-backed Lazada is the leading e-commerce player in Southeast Asia. It accounts for 46% of the market. And in the first quarter, iPrice Group and App Annie Intelligence ranked Lazada as the top e-commerce application in Malaysia, the Philippines, Singapore, and Thailand. They ranked Tokopedia and Shopee as the top e-commerce players in Indonesia and Vietnam, respectively.
However, Amazon was far behind in Southeast Asia, report iPrice Group and App Annie Intelligence. The company ranked tenth in Indonesia, ninth in Malaysia, and eighth in Singapore in the first quarter. It ranked fourth, fifth, and seventh in Thailand, the Philippines, and Vietnam, respectively.
Amazon expanding in Latin America
Amazon is also focusing on Brazil’s e-commerce market. On January 22, the company launched an in-house fulfillment and delivery network to sell merchandise directly in the promising Brazilian market. Additionally, it launched Prime in the country today. These moves all highlight Amazon’s growing appetite for international e-commerce.
