With the COVID-19 pandemic hitting businesses hard in 2020, everyone is looking forward to a better year in 2021. The new normal has changed the way people do business and how people live.
Moving from physical to digital realms
Perhaps the biggest change that the world experience from 2020 forth is the migration from physical to digital platforms in every aspect of life. This was no gradual change. It was an acceleration of sorts. From entertainment to marketing, education to food and everything else, life at large has changed as we know it.
In a recent statement by the US Retail Index, storefront businesses have moved to e-commerce faster due to the pandemic. The acceleration is as fast as 5 years! This means that SMEs have no choice but to move along with the times. Meanwhile, another sector that has accelerated tremendously is fintech. This is mainly due to the rise of e-commerce businesses. Major economies like Singapore, Australia and Hong Kong reported a more than 60% surge from 2020. That is a start contrast to 5 years before when it was only about 30%.
No let-down on consumer expenditure
The global economic outlook after 2020 could look gloomy and bleak but consumer spending is still high. There is no secret that unemployment and inflation rates are set to increase post-2020. While household spending has dropped, e-commerce transactions increased tremendously. The 11-11 Singles Days ale recorded by Alibaba saw a whopping USD74 billion in sales. That is about double its previous year. Moving forward, what should the gameplan be for businesses?
Change the way you do business
There has been an increase in live stream videos in Malaysia. If you are on social media, being on Facebook and Instagram is good, but it is time you get into the like of Tik-Tok. About 40% of the users are aged between 16 and 24. If you are targeting that group, this is the platform to go.
In 2020, Tik-Tok recorded 4 million users, which is fourth in Malaysia after Facebook, Instagram and LinkedIn. If that is not enough, the e-commerce sector in China that used live streaming tools garnered about USD 61 billion in sales in 2019. The numbers increased about double in 2020. There will be social distancing for sure which means you might have to continue limiting customers into your store. Hence, reaching out will be easier through livestreaming and videos.
New norms and technologies converge
You would have noticed by now that payment technologies have become more significant than ever. While it has been only used for e-commerce and online transactions, e-wallets have become the norm among physical stores. Even the normal economy mix-rice shops now accept Touch N Go payments. In a recent study by Mastercard, Malaysia is the top in Southeast Asia in e-wallet adoption. Meanwhile, the third quarter of 2020 saw PayPal recording more than 15 million active accounts.
Another aspect that you must look into is in interaction with your customers. Consumers are now spending more than 50% of their time with online interaction with companies as compared to pre-COVID-19.
So, what does it mean for your business?
The way forward is simple. You need to innovate and re-create if you want to survive. Malaysia has a strong following and high adoption rate when it comes to technologies. While it was slow in adopting financial tools when it comes to online purchases, they caught up quite quickly. So, technologies are your sure-win strategies. Connecting with your customers on live stream is another.
