“I can’t overstate how mobile is changing how we interact with our consumers.” -Joel Anderson, CEO of Wal-Mart.
Joel’s statement becomes more evident as only 9.6% of Gen Z reports buying items in a physical store –– considerably less than their older generations (Millennial at 31.04%, Gen X at 27.5%, and Baby Boomers at 31.9% respectively) Global web sales neared $3 trillion in 2018, increasing online’s share of total retail sales to north of 15%. With the slow death of physical retail stores, we are in the new era of e-commerce where consumers now have choice and convenience.
The world’s two largest economies—the United States and China—dominate global online retailing. Together, these two powerhouses accounted for more than half of worldwide ecommerce sales of physical goods in 2017.
According to Mckinsey, 1.4 Bn people will join the global middle class by 2020 and 85% will be in the Asia Pacific region (APAC). ecommerce as a whole has already shifted away from the West and will continue to do so and it has significantly revolutionary changes in the supply chain and the way business is conducted.
“China is a sleeping lion. Let her sleep, for when she wakes she will shake the world.” – Napoléon Bonaparte. Looks like the giant is slowly waking up and taking the world by a storm. A small impact of the storm falls on the E-Commerce industry globally as China, the world’s No. 1 ecommerce market, saw online sales soar 28% to $877 Bn from in 2017 from $685 Bn in 2016. According to China’s Ministry of Commerce. Total retail sales reached $5.85 trillion, an increase of 4.6%, which was a modest uptick from nearly 4.5% growth in 2016, when purchases hit $5.44 trillion. Online’s share of total retail in the country reached 15.0% in 2017, up from 12.6% during the prior year. China far outpaced the United States, the second-largest global market in ecommerce, in terms of both sales and growth.
If we were to look at the E-commerce industry in one of the largest and fastest growing market in the world- India- the trend is also going upwards. It is estimated that between 2018 and 2023, the value of the Indian e-commerce market will increase at a compound annual growth rate (CAGR) of ~41%, from $ 34.75 Bn in 2017. The growing number of Internet users and continuously increasing purchasing power are the primary driving forces for the growth of the e-commerce market in India. As of 2017, the Indian e-commerce market was dominated by the online travel segment (~49.59%), followed by that of retail, financial services, and online classifieds market, among others.
Internet and the boom in related technology is changing the way business is transacted even in our home ground. The size of e-commerce market in Bangladesh crossed the BDT 17 Bn-mark in 2017 from BDT 4 Bn in 2016, according to the data available with e-Commerce Association of Bangladesh (e-CAB). Retail e-commerce is growing at 72% a month. 60% of the customers are from Dhaka and belong to the age group of 18 to 35. The market size is expected to reach BDT 70 Bn (BDT 7,000 crore) by 2021. Ten leading companies — both foreign and local — are present in the online market. They are Daraz, Pickaboo, Ajker Deal, Bagdoom, Priyoshop, Shadmart, and Backpack. Of them, the market share of Daraz is estimated to be 40%. Currently, 25,000 small and medium enterprises (SMEs) are involved with this sector. The numbers of e-commerce websites and F-commerce pages are 2,500 and 150,000 respectively. The number of delivery is estimated at 15,000 to 20,000 at the retail level per day.
Technology is advancing and the world is changing as we speak. It is shaping how consumers decide what to buy and where to buy it form. It’s not just about where you sell your product or service but the value that you are creating and how you are responding to the dynamic market changes. More than ever, now it is absolutely crucial that start-ups and even big corporations keep up and adapt to the market because- the future is now!