Based on a survey by Euromonitor International the global E-Commerce market is set to expand by $1 Trillion by 2025. This is an unmissable opportunity, and every brand or retailer is trying to seize their chance to build a presence within this domain.
According to Euromonitor International the most important retail trend fueled by COVID-19 was the continued rise of e-commerce. This growth they report, is likely to continue even as vaccine distribution provides hope for a return to normalcy. In fact, 74% of global retail and consumer brand professionals said they expect the crisis-led rise in online shopping to become permanent in a survey conducted by Euromonitor International.
E-Commerce pull
E-commerce has been the fastest-growing channel over the last decade, with the crisis accelerating such shifts. Euromonitor International projects that half of the absolute value growth for the global retail sector over the 2020-2025 period will be digital. That equates to USD1.4 trillion in absolute value growth as more goods are sold online. To put that projected e-commerce growth in context, which would be roughly the size of the total value of products sold across all retail channels just five years ago.
China and the US will account for 55% of that value growth in e-commerce opportunities, which is to be expected from the largest e-commerce markets globally. From a percentage growth perspective, Latin America, an emerging e-commerce region, saw e-commerce adoption accelerated due to the crisis as more consumers shopped online to obtain necessities.
E-commerce in Latin America has long lagged behind other regions due to its large unbanked population, weak postal systems and consumer distrust of the channel, as well as other factors. COVID-19 led companies to make bigger investments in digital, including developing the website experience, adding direct-to-consumer operations and partnering with delivery services. Many turned to social media platforms like Instagram, Facebook and WhatsApp to facilitate interactions. For example, Walmart now allows consumers in Mexico to order products via WhatsApp.
These efforts helped Latin America post the strongest growth of any region with a 60% jump in goods sold online in 2020. MercadoLibre was one of the biggest corporate beneficiaries of the digital shift in Latin America. Euromonitor expects Latin America to continue growing during the forecast period, propelled by Mexico, which is narrowing the gap between itself and the region’s largest e-commerce market, Brazil. Traditionally, spend in the travel sector drove e-commerce in Mexico, but the desire to shop online out of safety concerns led consumers to overlook some of the hurdles like fraud and logistics that had previously dampened online sales.
India story
Just like the global rise in e-commerce, the Indian e-commerce market has also been reported to grow to become a US$ 111.40 billion market by 2025 from US$ 46.2 billion as of 2020. Much of the growth for the industry has been triggered by an increase in internet and smartphone penetration. As of April 2021, the number of internet connections in India significantly increased to 782.86 million, driven by the ‘Digital India’ programme, the government data registers. Out of the total internet connections, ~61% connections were in urban areas, of which 97% connections were wireless.
Indian consumers are fast voting for convenience ahead of anything else, this is further making e-commerce prosper and gain that edge over traditional retail. With the start of the festive season, now it is time to count on the sales and success of this sector, across industries.
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