Presented by TDCX

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Major economies in the ASEAN region (Singapore, Indonesia, Malaysia, Thailand and Vietnam) are undergoing a major digital transformation, with Singapore well in the lead. Organizations in the consumer goods, retail, and food and beverage industries are especially lagging behind in their digitalization journeys. But that lag isn’t for lack of desire, a study from TDCX (Transformative Digital Customer Experience) found.

“Digitalization is top of mind for ASEAN SMEs,” says Laurent Junique, founder and CEO of TDCX. “It’s becoming clear that without digitalizing, their companies will not survive against growing competition and increasing consumer expectations. Hence, they are motivated to develop digital capabilities to seize business opportunities from the digital economy.”

There’s a huge opportunity here for companies offering B2B solutions to help these companies accelerate their journeys, he adds, with ASEAN companies reporting that they plan to increase their investment by close to 70% with an expected spend of USD $130 billion over the next three years.

Understanding the need for digital expertise

The survey found an overwhelming number of companies are committed to investing in their digital capabilities in three specific areas. A full 80% of respondents are focused on ramping up their product or service innovation with digital tools such as data analytics, while 69% are pivoting to an ecommerce business model, and 69% aim to digitalize marketing, digitize customer relationship management, and segmentation targeting operations to enhance business processes.

“These companies recognize that they need help,” Junique explains. “Not only are they actively seeking tech providers to enhance their operations, but more than four in five of them surveyed say they’re also open to switching to a different tech provider. They recognize they can achieve their goals much faster with external solution providers. In fact, 84% see value in working with an external provider. These are target-ready customers.”

Breaking down the market opportunity

Working with an external provider enables companies to bolt on the capabilities they need more quickly, to stay competitive in an increasingly crowded market — and it means they don’t have to take on the maintenance of the digital solution themselves.

But the gap between intent and execution of digitalization comes from an array of challenges. The study found 67% of these companies lack access to knowledge and expertise, 65% recognize they need consultation on technology adoption and 60% need connections with the right service providers.

Plus, more than 80% of the companies surveyed say the value of an external partner is that it frees them up to focus on their core business functions, and extends their reach into their markets, Junique says. Six out of 10 respondents say that they’re prioritizing marketing and social media strategy, CRM and CX business functions for digitalization — though 60% report that they are struggling to manage these processes in-house, noting lack of skills within their team.

“These businesses lack the expertise required to reach the right customers, on the right platform and serving up the content customers want to see,” he explains. “This presents a clear opportunity for the right digital service provider to hold their customer’s hand through a more sophisticated CX strategy.”

What are they looking for in a provider?

These companies have a very specific wish list for the digital service partner they choose.

Over half of respondents say they prefer working with a single digital service provider, for faster decision-making and single point of escalation for key business processes. The top three reasons they gave for switching to external solutions providers are more advanced technology (71%), more responsive customer care (68%) and better price (45%).

They’re looking for providers with flexible solutions, strong technical skills (76%) and industry knowledge (69%). Fast response times are also key, according to 65% of respondents. And while chatbots and AI have become increasingly sophisticated, they’re also prioritizing human interactions. Human-assisted customer service (60%) and human-assisted chat (54%) are among the top five considerations when deciding which provider to work with.

“Incumbents therefore need to watch out for how they are responding to these needs, or they risk losing market share to competitors,” he adds. “And that’s why providers looking to break into the ASEAN market are finding partnering with local experts to be key in their success.”

They’re also looking for external support for their employee training needs, which suggests that they’re focused on generating revenue and ensuring that employees have the required skillsets to adapt to a digital future.

Breaking into the ASEAN market

Digital service providers will encounter particular challenges in approaching the ASEAN market, Junique says. Top among them is the non-homogeneity of the ASEAN market — every market has its own regulations, culture and business practices, which is crucial to keep top of mind. And while English is commonly spoken across the region, language barriers are common.

Entrants into the market will also encounter companies at every stage in the digitalization journey, which means providers must be agile, able to understand what a company needs at any given step, and be able to provide secure integration support and data privacy.

These challenges can be met by partnering with local experts, he says.

“A partner who understands ASEAN’s nuances can offer invaluable support to a service provider. This spans the entire customer lifecycle with the organization looking to enhance their digital capabilities, from the initial approach to the ongoing pursuit of customer satisfaction,” Junique says. “TDCX has helped global digital service providers scale and grow in the ASEAN market.”

For instance, a leading social networking platform that engages with millions of subject matter experts every day needed a partner to provide customer support across multiple languages including Vietnamese, Thai and Bahasa Indonesia. With its market expertise and the ability to hire multilingual talent, TDCX was able to swiftly engage and roll out the support teams needed to support the company.

“Partnering with a local company presents tech providers a significant leg up as they target a ready pool of customers,” he adds. “With the right approach, solution providers can establish long-lasting partnerships with these companies and unlock new avenues for growth in the dynamic digital economy.”

For more on the business priorities and opportunities in the ASEAN market, don’t miss the full survey, free to download here.

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