My current sabbatical from DBS Bank has been hectic and rewarding and given me time for some reflection on some of the fascinating themes playing out in tech and FinTech at the moment.

While I know everybody is addicted to Game of Thrones right now one of the most fascinating themes playing out is the real life Game of Thrones battle unfolding in South-East Asia. This one pitches the dragons of Chinese tech and the lions of Silicon Valley (sorry for the stretched analogy – I really have been busy but what a battle scene in Episode 4)!

Amazon’s entry to the South-East Asian market directly puts it head to head with Alibaba and Lazada. It pitches the newly crowned richest man now in the world, Jeff Bezos at Amazon, against the recently dethroned richest man in China, Jack Ma (replaced by Tencent’s Pony Ma just last week).

But it’s about more than just two companies. South-East Asia is a battlefield for Western and Eastern tech and FinTech. When I talk about Western I mean Silicon Valley. As I argued at MoneyConf in Madrid recently, at least when it comes to FinTech and ecommerce Europe has made very little impact. At least in this part of the world. [Editor’s Note: Neal Cross is based in South-East Asia]

What’s so interesting is pitching the Western Silicon Valley model against the China tech model. The likes of Uber, Airbnb even Facebook and Stripe have pioneered and disrupted industries and they’ve grabbed attention (sometimes for the wrong reasons). They have a strong marketing and UX lead.

As Henry Ford was purported to have said, if you asked customers what they wanted before the motor car was invented they would have said ‘faster horses’ – in some ways Western tech and FinTech is about designing faster horses.

That said they are brilliant at it. We are all familiar with the ways that Amazon uses consumer data on buying patterns to propose purchasing choices, and makes data available to merchants to help them list their products in the right way.

Chinese tech companies like Alibaba have been more cautious with their international expansion.

Why? Partly it’s because the nature of Chinese tech and FinTech suits their local market so well. It’s about getting stuff done. They are brilliant at coming up with completely new ways of getting what you want in the digital environment. But visually the product doesn’t translate, functionally it is different and the journey to get there is one non-Chinese users are not familiar with.

In my opinion though the way Chinese companies are using data is streets ahead.

The integration of online ecosystems in China, and selling to Chinese consumers between social media, entertainment and personalization is in a different league from anything we see in the West. At its recent Global Netrepreneur Conference Alibaba Group CEO Daniel Zhang said, “We are moving from satisfying needs to creating needs” – literally pre-empting what you need before you know you need it and selling it to you.

The problem is replicating that success outside of China.

As we know both Amazon and Alibaba have hugely deep pockets. It is interesting to see Lazada, which is of course now owned by Alibaba, sharpening its claws in the face of Amazon’s market entry with LiveUp which offers subscribers rebates and other benefits on Uber, Netflix and expedited and free delivery on Taobao as well as its own platform.

Added to the mix are some of South-East Asia’s home grown tech companies which are quietly forging their own way by adding a South-East Asian flavour. They don’t necessarily have the gargantuan budgets but they do fit the local market.

Go-Jek is a great case in point of a company that is dominating its home market with a truly localized model. Grab is giving Uber a good run for its money. Personally as a user of both Uber and Grab I think Grab is much better in the way it can predict my next destination and remembers where I have been to make suggestions. Uber for all it was a front runner has stuck to an interface that is not as user-friendly. How annoying is it that you have to enter a destination before you can update your current location?

As we square up for a battle royale between the big tech titans of East and West in South-East Asia, what I’m most excited about are what new and creative ideas and opportunities will emerge as a result of that competition.

That will be worth watching!


This is a tailored version of an article that first appeared on Neal Cross’ LinkedIn page.


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