Loqate, a GBG solution
Malaysia’s expanding digital economy: Why address and geocode data matters

The digital boom has amplified Malaysia’s already high smartphone penetration, making the transition to online buying and selling seamless. 

It was reported that in 2020, 80% of the country’s population were active internet users - some 26.7 million citizens - of which 26 million are active social media users, with an 83% mobile phone penetration rate.

This sets the scene for a potentially highly engaged and active portion of the population, ready and able to use their devices to buy items online at the click of a button.

But what happens when the user base is ready but the location data is not? Let’s explore the pitfalls of inaccurate location data and what role geocodes play in rapidly expanding digital commerce locales such as Malaysia.

The potential

With a dynamic and developed infrastructure for digital technologies, Malaysia is the perfect candidate for the eCommerce industry. The revenue in Malaysia was said to reach $4,179 million in 2020, forecasted to grow annually by 17.8% in the years thereafter. By 2024, the International Trade Administration expects the sector to be worth $8,059 million.

These figures, paired with the population’s keenness to participate in digital mediums, paint a healthy picture for development in the eCommerce sector.

break into emerging markets with geocodes

Current market trends

DataReportal’s 2020 analysis of Malaysia stated that:

  • Approximately 50% of the population (16.53 million) are active online shoppers
  • Of the area’s mobile users, 62% use their devices to shop online
  • Individuals are motivated by product quality and range, and discounted prices
  • Influenced by exclusive deals, shipping offers, and convenience of online shopping
  • Purchasing decisions usually hinge on the availability of customer reviews.

Looking forward, the trends expected of the locale center around further proliferation of online shopping, with digital payment methods becoming the norm and express delivery. This means one thing: the location data and mapping need to be accurate to avoid unhappy, unsatisfied customers.

The challenge

Statista has found that 20% of online shoppers in Malaysia pay with credit cards, potentially leading to credit card fraud and stolen identity. For this reason, some merchants offer ‘cash on delivery (COD) options to stop this from happening - but this inevitably leads to more extended processing periods, more manual involvement in the last mile, and the faith that customers can pay up when receiving the item.

To this end, JP Morgan has commented that this transaction can be a significant development staller for international businesses vying for Malaysian’s trade, as it can be much more logistically challenging to receive payment compared to local merchants. Currently, bank transfers account for 44% of the payment methods used in eCommerce in Malaysia. Card usage is next, at 36%, with cash on delivery coming in third at 11%.

It is reported that global merchants have set up depots within Malaysia to help with the delivery efforts and to improve product availability - but this obviously comes at a high cost, and one only available to the big players in the eCommerce arena with the capital to set up establishments overseas.

Furthermore, traffic congestion plays a significant role in challenging the development of Malaysia’s digital industry and underdeveloped geographical infrastructure, which often leads to unreliable delivery attempts.

Geocodes and the last mile

From our experience, location and geocode data provide an enhanced level of accuracy that can help pinpoint an address to a rooftop or premise location. With so many people relying on smartphones, geolocation tech helps people get to their destination safely, efficiently, and without hassle.

Accurate geocode data allows companies to build site-to-store shipping capabilities, improve the efficiency of shipping routes, communicate delivery estimates with customers, and create custom location-based apps.  Alternatively, our Reverse Geocode solution can identify a location nearest to a latitude and longitude coordinate, increasing location data reliability in locales that traditionally are hard to address or identify.

It is the combination of our Capture and Verify technology platforms with our global reference data that enables Loqate to deliver a superior solution to our partners and their customers.

Once your customer’s current location has been determined, we can convert it to the most accurate longitude and latitude to return a complete address based on a radius of 50 meters. This means the data you capture will be clean and accurate, and services and products can be delivered directly to your customer’s location.

global addressing is complex without geocodes

How an Address Specialist Can Help:  

Overcoming substantial location mapping issues during the last mile of delivery in rural, hard-to-address areas can be a challenge - but armed with a repository of location data to use at checkout, you can ensure that your customers are entering their data in a correct format while being verified at the point of entry.

Loqate’s Global Partner Program can ensure that any data entered contains correct address information - no matter where your customers are located.

Through cross-referencing, combining, and consolidating data from multiple trusted data suppliers across the globe, we can create one single best record, enabling us to provide you with access to the world’s most comprehensive and detailed repository of address data.

Enrich your data to ensure correct address information globally. Learn more about Loqate’s Global Partner Program and our address verification solutions here.

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