Tech innovation reshaping Asian economies is indicative of future trends set to impact other regions. Citi analysts argue if developments in Asia are anything to go by, the US and Europe should prepare for the accelerated rollout of applications like super apps, social commerce, eSports and digital health.
Western economies should buckle up for a series of tech trends from Asia set to accelerate change. In a new report ‘Asia as a Time Machine to the Future’ analysts at Citi explore seven areas where Asia gives interesting insights into the future. The region adopts new technologies eight-12 years ahead of the West, making it much like a time machine to the future. Asia’s high internet connectivity, young and increasingly affluent and urban demographics, and entrepreneurial spirit have driven the region to adopt many technologies at a faster pace. In doing so, Asia provides a glimpse of what the future could look like in more developed, Western economies.
The rise of super apps
As opposed to a single-purpose app, the all-in-one super app offers a one-stop, comprehensive ecosystem of different apps, together providing an extensive suite of services. Super apps are largely unique to Asia, yet they are ubiquitous across the region. Asian users are immersed in super apps and enjoy the convenience, ease of use, and multitude of services they provide. The products and services offered by super apps are closely tied to the everyday life of a consumer. From instant messaging and e-commerce to food delivery and ride-hailing, a super app’s suite of services is devoted to enhancing every minute of the user’s day.
The top super app in Asia is Tencent’s WeChat, which recorded 1.3 billion monthly active users (MAUs) as of the end of 2022 – this means approximately 92% of China’s population and 17% of the world’s population regularly visit the app. Outside of China, regional and local champions are powering rapid adoption of super apps. KakaoTalk is not only South Korea’s dominant instant messaging app, but also the platform to the nation’s most-used taxi-hailing app, leading mobile banking app, and music streaming service.
Mobile payments
With the advent of numerous mobile fintech solutions, including mobile banking, mobile internet payment, embedded finance, direct carrier billing, and perhaps most notably, mobile wallets, Asia leads in mobile payment adoption. These features, coupled with the high prevalence of QR code purchasing and point-of-sale (POS) systems across Asia, mean consumers can instantly pay for almost everything through their mobile devices.
According to FIS, in 2021, digital/mobile wallets accounted for nearly 70% of the e-commerce transaction value in Asia, more than double the share in North America or Europe. Likewise, for purchases at physical POS, nearly half (44%) of transactions in Asia were done via digital/mobile wallets, a share 4-5x larger than in the West.
Social commerce
Social commerce is a subset of e-commerce that offers consumers an integrated platform with social features, providing a more immersive and interactive shopping experience. It captures the offline experience of going to a mall with friends, for example, where customers can interact, try out products, and encourage one another to make purchases. Yahoo! first introduced the concept of social commerce in 2005 when it enabled users to share and discuss items from its online shopping catalogue but outside of Asia, social commerce is still at an early stage positioning it for growth. For example, US social commerce is expected to grow to around US$100bn in 2025, while Asia already reached over US$400bn in 2021.
Major tech players in the West, such as Instagram, Snapchat and YouTube, are beginning to roll out features like livestreaming and AR filters to capture the growth opportunities in this field, further reshaping the e-commerce industry worldwide.
Short-form videos have revolutionised the way people consume video content. Short-form videos are credited to several different origins, including ad clips that preceded traditional, long-form videos. However, the commercialisation of short-form videos really took off with the launches of the Kuaishou and Douyin platforms in China in 2011 and 2016, respectively. In 2017, Douyin’s parent company ByteDance launched its international version, TikTok, ultimately surpassing Google.com as the most visited domain globally for a period in 2021. It’s a trend set to grow more in the west, argues Citi.
eSports
eSports, or multi-player video game competitions, is one of the fastest growing industries worldwide. The global market size was estimated to be nearly US$1.4bn in 2022 and is projected to grow at more than 10% per year through 2025; nowhere has adoption been greater over the past two decades than in Asia.
Viewership of eSports tournaments – such as the 2018 League of Legends World Championship in South Korea with approximately 100 million unique online viewers – has even surpassed some of the world’s largest traditional sporting events like the NFL’s Super Bowl.
Webtoons
Webtoons are digital comics optimised for viewing on mobile devices by their vertical format. They are intended directly for digital consumption, unlike traditional comics, which are physically printed or displayed in a book or “strip” format.
The popularity of several webtoons is already eclipsing that of traditional on demand content, such as TV shows. The longest-running webtoon, ‘The Sound of Your Heart’ – a South Korean comedy series about everyday life – ran for over 14 years from 2006 to 2020, with over 1,200 episodes (one released per week) and approximately seven billion cumulative views. Among the more recent webtoons, Lore Olympus, a modern retelling of the romance between the Greek goddess Persephone and the god Hades, has garnered 1.2 billion cumulative views and 6.1 million registered subscribers on WEBTOON – a leading platform for webtoons – since March 2018.
Healthcare
The integration of technology platforms, sensors, big data and mobile connectivity is driving a rapid digital transformation in healthcare. In Asia, digital healthcare is significant in terms of both scale and penetration. According to McKinsey, digital healthcare has touched the lives of around 1.5 billion people in Asia and its user base is continuing to grow. Furthermore, studies suggest the adoption rate of digital healthcare in developing Asia is 2.5 times the rate in the US.
