Here’s my review of the latest Digital Economy Compass 2020. If you take a closer look, from page 134 onward, the report has shed a great deal of light as to what the global eCommerce landscape looks like now (2020) and in the near future. Instead of reading the entire lengthy (234-page) report, I’ve dissected the Digital Markets and eCommerce Outlook section here for your quick read.
It is very interesting to note that the eCommerce industry worldwide is going through a pretty massive change. This is not only due to the COVID-19 pandemic but also due to how consumers expectations in eCommerce has changed. Consumers now demand a certain level of security, mobile-optimized search, spontaneous checkout process and quick product deliveries and returns.
Many businesses and industries have suffered amid the COVID-19 pandemic here in Malaysia. The various lock downs throughout the world has caused turmoil in governments, SMEs, airlines, hotels and various other industries. Some even were forced to cease operations, probably because they were unable to revive operations.
Its a sad plight but its a reality.
Having said that, many other industries and companies, not only in Malaysia but throughout the world, have thrived during these unprecedented times. According to the report, global eCommerce revenues have grown to 10% due to COVID-19.
Digital Economy Compass 2020 report divides the eCommerce outlook
Further, Statista has brilliantly divided the eCommerce outlook into five (5) product segments and disclosed a detailed study.
2) Electronics and Media
3) Toys, Hobby and DIY
4) Food and Personal Care
5) Furniture and Appliances
Find out what are the best eCommerce business models in 2021.
And here is the best part, the eCommerce market is expected to reach a growth rate of US$3.3 trillion dollars by 2024 with “fashion” taking the top spot among other product categories.
This is an eye opener. China has beaten US and other developed nations in eCommerce revenues amounting to US$1,116 billion dollars. Hey! I’m talking about billions of dollars here.
How and why are the numbers showing so much positivity despite a negative realm? How has China overthrown and made the US eCommerce look like ‘child’s play’.
The way I understand it, China’s eCommerce market growth is due to three (3) major factors:-
a) Increased purchasing power of the local population.
b) Their increased cross-border eCommerce transactions.
c) Chinese population has become extremely tech-savvy and are a mobile-first nation.
China’s US$1,116 billion dollars revenue in 2020 has made many heads turn – well, they’ve turned to the east that is.
The US, coming in second with a shy US$411 billion dollars followed by Japan with US$105 billion at 3rd place. I guess its only a matter of time as no one remains at the top forever now, do they?! Its time for another world super-power to hold the torch.
Which Chinese companies made all these numbers possible?
Well, you might have already guessed it – its no other than the Alibaba Group, JD and Tencent obviously!
For further reading: Alibaba beats sales forecast on China eCommerce growth
Here is what else I’ve discovered in the pages of the Digital Economy Compass 2020 report.
These megalith Chinese giants are not stopping their tracks in China alone. They have also begun penetrating other Asian markets such as Indonesia and India.
So, just like the 3rd point I mentioned earlier where a huge percentage of the Chinese population in China have become tech-savvy and mobile-first, a growing number of population in Indonesia and India are also joining the ranks.
Probably that is why it makes perfect sense why Chinese companies are expanding into other countries and regions. Perhaps to align with their plans for world dominance? Am I sounding ridiculous? Well, that is for you to decide. At least, I’m not the only one who thinks so.
At the rate these Chinese companies are growing, they are definitely planning something big. With the Chinese, its never small.
US have always lead the global eCommerce race.
All these years, the US have always lead the global eCommerce race so it’s interesting to see how an ex-communist country has risen to the occasion and put a solid stamp on the global eCommerce outlook.
If you take a look at the US, there are basically three (3) major players are making strides and waves in eCommerce. They are:
It is known that Amazon has also managed to penetrate other EU eCommerce markets. And cross-border eCommerce has truly become a hot topic in the EU free trade zone. What comes to light is geographic proximity and logistics have made it possible for sellers to provide really attractive and quick shipping times.
For the local buyers in the EU, they’ve enjoyed convenient products returns because of this and its an important factor that has driven trust and higher eCommerce adoption rates in the EU.
If you take a look at marketplaces, the report covers mainly US and EU famous marketplaces such as eBay and Amazon. So it’s interesting to learn what these marketplaces are up to and the report delves deep into this topic showing graphs and data which is truly invaluable.
The global online retail eCommerce is growing. Not only in China, US and the EU but also in emerging countries like Indonesia, Malaysia, Thailand and Vietnam too.
I like what Rotar Alexander (editor of the Digital Markets column in the report) said…
Both online-only players and traditional retailers are developing various multi-/cross-channel strategies to reduce inconvenience and increase customer satisfaction throughout the customer journey. Package delivery boxes and precise delivery times for working people, drone deliveries of time-sensitive products such as medicines as well as sameday- delivery services are only a few of many ambitious innovations and optimizations in the area of product and service delivery.
OK! Enough of my blabbering.
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