In November 2022, Meta cut 11,000 jobs (about 13% of its staff) in the biggest tech layoff of 2022. It wasn’t just Meta, many other tech industry giants made cuts and “right-sized” amidst uncertain economic conditions.
This means that many skilled immigrants were forced to quickly find a new job or leave the countries they were employed in. Considering the emerging tech and start-up scene in Southeast Asia (SEA), the region might appeal to many of these young, innovative, and determined individuals.
Let’s not forget that for some, it could be the perfect reason to go “home” – wherever it may be.
What does this mean for SEA? How might its tech industry develop and how could its societies change? What would it mean for (non-tech industry) brands?
Let’s explore some possibilities.
SEA is going through a period of digitalisation
We’ve seen various unicorns – Bukalapak (Indonesia), Grab (Malaysia), Lazada (Singapore), etc – emerge from the region in the past decade, and we don’t expect it to end there. In many ways, SEA is still “playing catch up” with the modern world.
There remain many challenges to be solved throughout the region – in healthcare, education, banking, entertainment, and so on – and solutions often bring about new challenges (or opportunities).
While tech skills are growing among locals, there’s arguably still a lack of practical experience. SEA companies will be on the lookout for skilled individuals who have experienced failure and success – to help them avoid missteps, mentor local talent, and inspire new ideas for the future.
To attract these individuals, certain SEA nations – Thailand, Malaysia, and Indonesia – have started offering “digital nomad visas” to attract skilled foreign talent and other high-net-worth individuals.
To clarify, SEA’s tech ecosystem was not immune to layoffs in 2022 and in the current economic environment, funding appears constricted. However, experts continue to project economic growth in the region, even if it seems a little slow right now.
One reason for this is that, in our ageing world, the World Economic Forum predicts that Gen Zs and Millennials will make up 75% of ASEAN consumers by 2030. This is a change-driving demographic so expect many to start their own tech- and purpose-led businesses.
So beyond e-commerce, Fin-tech, Edu-tech, and digital entertainment, expect to also see investments in Agri-tech, Food-tech, Health-tech, Green-tech, SaaS (Software as a Service), EV, Automation, etc.
Will SEA consumers welcome these tech-led changes?
Depending on one’s perspective, tech can be viewed as a force for good or one for evil. It’s been called the great isolator but also the great connector. It has “stolen” jobs but created new ones. It has given us the power of anonymity but also a path to fame.
It won’t just be technically skilled individuals (eg engineers, programmers, designers) in high demand, but those with keen human understanding as well.
With many new tech innovations, adoption is part of the product itself. Social media platforms cannot exist without users, and solutions are meaningless without the need (eg e-grocery).
How well a company or start-up understands the market, the community, their potential audience, and its needs are key to its success or failure – along with an offering that is convenient, safe, and pleasing to use. This means there will be immense opportunities for collaboration (eg between local and foreign talent or companies), but also heightened user expectations to meet.
What will this mean for brands in SEA that do not operate in the tech space?
Even if a brand does not directly operate in tech, it’s undeniable that they have to understand how to operate in a digital world. Tech is not limited to software, platforms, data, or devices. Technology drives innovation at all levels and changes how consumers interact with the world.
Advancements in technology (eg cell-cultured protein) will change how consumers think about the sustainability of their food, will change the approach taken in the agriculture industry, will change the food industry, will change the healthcare industry, and so on and so forth.
The proliferation of local start-ups will make collaboration between tech and non-tech brands easier.
Hence, established brands should prepare themselves for the wave of anti-brand brands which promise – through technological innovation – ways to improve the lives of consumers while saving them money. Similar to how start-ups like Airbnb, WhatsApp, and Groupon emerged in 2008 amidst the Great Recession of 2007-09.
These start-ups will be worthy, agile challengers that quickly respond to the latest technologies and changes in consumer behaviour.
Across all industries, brands will be the disruptor or be disrupted
But let’s bring it back to skilled individuals that may soon find themselves in SEA. Commanding relatively higher salaries, these consumers will likely have more disposable income than the majority of locals. Expect neighborhoods surrounding tech hubs to gentrify as they seek artisanal luxuries, spaces for leisure and community, and various other ways to improve their quality of life.
They will potentially bring about new opportunities for local and international brands, accelerate tech ecosystems, and hopefully benefit local communities.
Southeast Asia’s tech and start-up scene could dramatically change in the next five years, and influenced by their surroundings (ie changemakers and trendsetters), so could Southeast Asian consumers.