The Big Opportunity: Understanding the Connected Consumer in Asia

By: Devin Wenig, President & CEO

A lot has been written about the great Asian opportunity. True success will be determined by the ability to separate the reality from the hype.

This article originally appeared on LinkedIn.  For more real-time thoughts from eBay's CEO, follow Devin on Twitter.

During every visit to the Asia-Pacific region, I am always amazed by two things: how much it has changed since my last trip, and how richly diverse the region is.

It can be tempting to think of Asia as a single entity in business terms: A perfect storm of e-commerce opportunity and challenge, driven by an explosion in mobile penetration and fueled by a millennial population growing in wealth.

But the facts are more nuanced.

Most parts of the Asia Pacific region have emerged into the internet age as a fully-fledged mobile society. For many consumers, the first experience of a connected world was via the screen of their mobile device. They leapfrogged desktop and went straight to mobile.

This generation of hyper-connected consumers have a high propensity for technology, and are early adopters of new gadgets and mobile services.

eBay’s own data tells the story: Globally, 42 percent of our business is now conducted on mobile, but in some Asian markets, that figure is almost 70 percent.

But despite the digital disruption happening in almost all of the region on an unprecedented scale, especially in rural areas, the Asia Pacific region is by no means a single market populated by like-minded consumers.

It is a complex region, developing in a multi-country fashion. The needs, habits and buying trends of consumers vary from country to country. To fully take advantage of the opportunities the region offers, recognizing and responding to those differences is crucial.

A good example of this is South Korea, where eBay is the market leader and the e-commerce market is fairly robust. There, driven by market demands, we have expanded into new categories, including fresh food, and groceries.

 eBay’s leadership team and I visited Seoul last week, and we were invigorated to meet so many driven, mobile-first, digital colleagues – who are also consumers in one of the most connected markets in the world, with each owning more than two devices.  

From there, we went to Japan, another entirely different and equally exciting market. I met with eBay sellers -- entrepreneurs with access to high quality, manufactured products, brands and luxury items -- who are embracing eBay as a global shop front, allowing them to reach buyers in 201 different markets.

The contrast between the two countries was striking, and that is true right across all the major Asia Pacific markets.

Our focus in China, a mature market, has been on growing cross border trade and helping our sellers to expand globally with a combination of local support, innovative software solutions and data.

In neighboring India, which is newer to e-commerce, distinct consumer preferences are emerging, including cash on delivery, installment-based buying plans and personalized interaction with customer service representatives. India remains one of the biggest e-commerce growth opportunities in the region and is attracting a lot of investment. There's plenty of hype, but there's also a good deal of reality in India. We're investing appropriate amounts to grow the eBay brand, and the buyer acquisition has been strong.

I believe the market in Southeast Asia, which is fairly new to e-commerce, will explode with rising mobile usage, though it is currently fragmented with mostly local players.

Moving east to Australia, where there is a concentration of big brick and mortar retailers, we have partnered with 37 of the leading 50 retailers, who see our platform as their doorway to a connected world. Given the unique market dynamics, this is a complimentary strategy to our focus on small businesses on our platform.

In each of these markets, individual national players are emerging as strong forces. But it is unlikely to be a winner-takes-all market. The opportunity is big enough, and the growth is explosive enough, to drive multiple winners.

Longer term though, market forces, opportunity to scale and cross border trade will, I believe, drive consolidation.

As with many aspects of the relationship between East and West, some of the business practices and strategies that took root in Asia are moving West -- such as promoted listings. And certain Western approaches are also taking root in Asia – such as cross border trade and fulfillment/loyalty bundles.

eBay’s strategy across the region involves taking advantage of those synergies; keeping up with the pace of innovation; staying agile and flexible; planting seeds in emerging markets; building strong local teams, and partnering aggressively to improve localization and traffic.

A lot has been written about the great Asian opportunity. True success will be determined by the ability to separate the reality from the hype. For businesses prepared to look beneath the surface, there’s no denying the scale of the possibilities. eBay is “all in.”