Hi, it’s Edmund.
Asia is famous for its fragmented markets, largely due to its different cultures, languages, economic growth rates, and regulations.
For businesses that want to successfully operate in the region, there is a need to develop a sound localization strategy.
A good example is the digital payments ecosystem in Southeast Asia (SEA). Players in this sector have adopted localization strategies, and each SEA country has a preferred e-wallet. Singapore has PayLah! and GrabPay, the Philippines has GCash, Indonesia has GoPay, OVO, and DANA, Vietnam has MoMo and VNPAY, and Malaysia has Boost and Touch ‘n Go.
The fact is that the highly localized digital payments landscape, coupled with the reliance on QR-based payments, would explain why many international players in the payments sector, such as Stripe and PayPal, have not gained traction in Southeast Asia.
Having said that, while Asia’s fragmented landscape presents multiple challenges for businesses, it can also create growth opportunities. For instance, market fragmentation can provide young startups with competitive advantages, allowing new entrants to catch up with market incumbents.
A fragmented market also implies that there is a gap to be filled—hence, business opportunity. This week, I spoke with Kailash Madan, APAC Head of Sales at Primer, an automation platform for payments and commerce, which was launched in 2020 by former PayPal employees.
He told me that merchants in the region don’t want to spend significant time and effort maintaining different payment methods. Instead, they prefer to leverage a single unifying infrastructure to reduce costs and improve operational efficiency. And Primer’s open and agnostic platform addresses this issue by connecting merchants across the region to diverse payment service providers.
Check out more on the interview here.
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