Market Trends of Malaysia E-commerce Industry
Government Initiatives Are Boosting the Adoption of Digital Solutions
- The Malaysian government also recognizes the rise in e-commerce. In the first quarter of 2023, the net income of e-commerce in Malaysia surpassed MYR 291 billion (USD 62.18 billion), increasing from around MYR 287 billion (USD 61.20 billion) in the previous quarter. The quarterly net income of e-commerce in the country has been steadily increasing over the past few years.
- The previously mentioned factor is seen as a means of promoting inclusivity by the government, which has pledged assistance to boost local micro, small, and medium enterprises (MSMEs). Additionally, Digital Free Trade Zones have been established to ease cross-border e-commerce and expand the market for MSMEs.
- The digital sector contributed USD 1.162 trillion to Malaysia's GDP, as reported by the Malaysian Finance Ministry. It is expected that over 500,000 new jobs will be created by 2025. The government actively collaborates with the private sector to encourage consumers to adopt digital services and to assist small businesses through incentives and support.
- The government unveiled an action plan with eight points. Some options include restructuring existing economic incentives and reducing non-tariff barriers such as consumer protection, cross-border, and e-fulfillment. Other strategies involve providing targeted funding for selected e-commerce firms and showcasing local brands to boost global e-commerce.
- The Digital Economy Blueprint outlines plans for Malaysia's digital transformation in sectors such as e-commerce, which will be executed by 2030. It lays out plans and actions to encourage digital usage, boost skill growth, improve digital resources, and establish a favorable regulatory setting. The plan intends to drive Malaysia's digital economy and establish the country as a key hub for e-commerce and digital innovation.
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Consumer Electronics is Expected to Witness Growth
- According to the Malaysian Department of Statistics, the sales value of manufactured consumer electronics in Malaysia was approximately MYR 42.21 billion (USD 8.99 billion). The sales value of consumer electronics produced has fluctuated over the years. Nevertheless, e-commerce has been crucial as more ordinary individuals buy items online.
- Technology can improve individuals' lives by utilizing consumer electronics. The emergence of Industry 4.0 has accelerated the development of innovative consumer products, increasing the demand for smart consumer goods incorporating state-of-the-art technologies such as IoT, AR, VR, and AI.
- Some factors propelling the consumer electronics market include technological advancements, changing customer preferences, and the increasing need for affordable, user-friendly, and effective goods. Consumer electronics include smartphones, household appliances, computers, laptops, televisions, game consoles, and wearables. As product launches increase in the consumer electronics sector, e-commerce is becoming more popular for purchasing those items.
- The rising emphasis on luxury items in the consumer goods sector by domestic consumers is expected to boost the need for quality headphones and big-screen smart TVs. This trend is expected to push the market’s current value growth above the growth in retail foot traffic.
