Ashutosh Sharma, VP and Research Director and Michael Barnes, VP and Research Director
In 2022, Asia Pacific countries largely avoided the economic slowdown that major economies elsewhere experienced. That is now changing, and as it does, APAC governments and firms will turn inward, doubling down on interregional trade partnerships and investing in customer experience improvements. This week, Vice Presidents and Research Directors Ashutosh Sharma and Michael Barnes discuss how these efforts will play out.
Though global economic trade will slow this year, cross-border commerce in APAC will increase by 20%, Forrester predicts. A big contributor, Sharma explains, is the Regional Comprehensive Economic Partnership, the world’s largest free trade agreement, which took effect last year and covers 15 APAC nations. Meanwhile, countries including India and China are pursuing modern cross-border payment networks that will make these payments faster and cheaper to execute.
“If you combine these trends with the fact that this region has very high smartphone ownership … and that digital payment is growing fairly rapidly, it gives us the confidence to say that cross-border payments is certainly going to grow very rapidly,” Sharma says.
Yet in other areas, the region will stumble. Forrester predicts that in 2023, eight in 10 omnichannel initiatives will fail. After pivoting to virtual experiences during the pandemic, companies are returning to investing in in-person experiences but “never learned the lesson that those channels need to be integrated,” says Barnes. Siloed, multichannel experiences will fall short of customers’ expectations and deliver only isolated tactical improvements, the analysts say.
Sharma and Barnes also dig into a third Forrester prediction: At least 50 APAC firms will be penalized for performative environmental, social, and governance (ESG) actions this year. As demand for green products and services continues to grow, Asia Pacific regulators are following in the footsteps of their European and American counterparts and clamping down on misleading claims. “Many brands have good intent, but there’s a level of rigor required there — there’s a level of proof required,” says Barnes. Firms that are exposed will suffer reputational hits, and some could face steep fines, as well.
The episode closes with the analysts giving some practical advice for APAC firms to succeed in the coming months and revealing a bonus 2023 prediction for the APAC region.