The Philippines is trailing behind in actual AI adoption in the Southeast Asian region due to weak infrastructure development and concerns about its usefulness and costs, according to a report from major e-commerce platform Lazada.
The recent report from Lazada in partnership with global market research company Kantar, “Bridging the AI Gap: Online Seller Perceptions and Adoption Trends in Southeast Asia,” outlined the current trends, challenges, and opportunities and offered insights into how online sellers can use AI in their business.
It surveyed 1,214 online seller respondents between ages 18 and 60 from various Southeast Asian countries, including Thailand, Malaysia, Singapore, Vietnam, Indonesia, and the Philippines, in various categories, such as fashion, home and living, health and beauty, F&B, and electronics.
Perception towards Artificial Intelligence
Filipinos are well-acquainted with AI, and sellers are more inclined to incorporate AI into their personal lives than buyers. Fifty-seven percent of sellers expressed confidence in adopting AI in their personal lives, while thirty-five percent aim to fully embrace it.
However, although 80% of Filipinos who responded to the survey view AI as essential for productivity, about 53% remain skeptical about its usefulness, which is lower than the 61% average for Southeast Asia.
Cost and time concerns are a significant implementation dilemma for AI, with only 55% of Filipino respondents stating that AI adoption can be costly and time-consuming in the short term. However, 91% agree that AI will save costs in the long run.
As in previous reports, individuals consider upskilling in AI skills to be critical for enhancing productivity. However, 67% of employees still prefer using familiar tools for daily tasks.
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Artificial Intelligence Adoption in E-commerce
There remains a wide gap between what businesses claim their AI adoption is compared to the actual rate, with 41% claimed adoption in business compared to just 32% on its actual adoption.
The Philippines is in the same “To build” quadrant as Malaysia, which has high knowledge but low actual AI adoption. This prompts businesses to leverage resources to build infrastructure. Thailand is the only SEA nation from the study considered to have high knowledge paired with actual AI adoption, surprisingly even ahead of Singapore.
Artificial Intelligence Readiness Index
The Lazada research also used the survey results to create three archetypes based on the level of AI adoption across five core aspects of an online seller’s business operation: Marketing & Advertising, Workforce Management, Customer Service, Product Management, and Operations & Logistics.
The three archetypes are: AI Adepts – sellers who integrate AI across multiple aspects of their operations (top 25%), AI Aspirants – performing average in AI adoption, and AI Agnostics – sellers lagging across most work processes (bottom 75%)
Only 19% of Filipino e-commerce sellers placed in the AI Adepts category, below the 24% regional average. 44% fall under AI Aspirants, still below the 50% average. Unsurprisingly, 37% of Filipino sellers are AI agnostics, ahead of the 26% regional average.
AI Adoption & Readiness Across Markets
The research also found that Filipino respondents excel in AI tool knowledge, so focusing on the infrastructure can bridge the adoption gap.
Customer-facing functions are doing well, thanks to a high adoption rate for chatbots and predictive analysis. Inventory tracking and automation are also commonly adopted. However, complex processes, such as investing in AI-powered surveillance and warehouse management, are among the weaknesses.
According to Filipino respondents, AI chatbots, generative AI, and AI smart listing are among the most useful AI features in their business.