E-Commerce in Asia Pacific: Big Opportunity for a Growing Region
By Joe Nguyen
Tis the season for holiday shopping, and across the globe more people
are turning to the Internet to make their purchases – particularly in
the retail sector. E-commerce is traditionally led by travel
transactions and purchases, but towards the end of the year in the U.S.,
retail e-commerce picks up. E-commerce can equal big bucks – take for
instance the recent record the U.S. hit in holiday spending when the
country experienced its first day on record of achieving more than $1
billion (USD) in e-commerce sales on a single day during Cyber Monday
(November 29). This highlights the opportunity the digital channel holds
for retailers.
In Asia Pacific, visitation to retail sites has achieved a much
higher market penetration than travel – which tends to be the gateway
and primary category in online purchasing. In most markets, more than
half of Internet users frequented a retail destination in October, while
in most cases less than half frequented a travel site. Looking at which
markets were most retail savvy, Japan topped the list with 80 percent
of its online population visiting a retail site in October, followed by
Australia (76 percent) and South Korea (72 percent). Singapore achieved
the highest percent penetration for travel with 52 percent reach,
followed by New Zealand and Australia at 48 percent and 43 percent;
these markets have retail penetration rates of 64 percent and up. It’s
interesting to note that just because a market exhibits high propensity
for utilising retail sites, does not necessarily mean they are as
willingly to frequent travel sites, with large differences in these two
activities seen in several markets including Japan, South Korea,
Vietnam, and Taiwan.
In Consuming Retail Content – Females Take the Prize
In most markets across the region, women were more likely to consume
content at retail sites than men, with Taiwan, Hong Kong, Singapore, and
Japan showing strong disparity in page consumption. On the flip side,
Vietnam and the Philippines showed males much more likely to consume
pages of retail content than females. For brands looking to develop
engaging content on their sites, understanding viewers from a
demographic and behavioural standpoint is critically important.
The Future of E-Commerce: A Promising Outlook
At this point, e-commerce revenues in Asia Pacific are still not
comparable to the Black Fridays and Cyber Mondays, but increasing
traffic to retail sites means more shopping, which will result in more
buying – online or offline. The e-commerce channel holds incredible
potential for brands and retailers across the region and for some
markets in particular. For brands attempting to access and capitalise on
the online channel as a way to reach consumers and their wallets, it’s
important to remember several things when building your digital commerce
strategy:
- Know your target audience and where to find them: Understanding who your key audiences are, including their demographic characteristics, what online sites and categories they visit, and what digital content they spend time consuming, will help you reach and engage your audience more effectively, especially for smaller or less-known brands.
- Create a secure environment: In many markets, consumers still face a lack of confidence in conducting secure transactions online. Developing a secure environment and providing consumers with transparency in your purchasing policies can help build trust in the channel and make the differences if a consumer buys from you or your competitor.
- Online presence can equal offline sales: It’s important to remember that not all people will buy online, but many will in fact research and browse online and make the actual purchase offline. So even if you don’t plan to sell your goods digitally, having a digital brand presence is increasingly important to savvy shoppers.
- The payment gateway is key: Credit cards are not “King” in many markets in Asia Pacific for e-commerce, because not everyone has one (or two). Alibaba.com has Alipay to connect to banking debit accounts and is one of the main reasons for its success. Other markets are following a similar debit rather than credit route.
E-commerce in Asia Pacific is growing as our company also highlighted in a recent press release
that the U.S.-focused Cyber Monday also attracted a lot of
international shoppers. Nearly 6 percent of the billion dollar hoard on
that day came from people living outside of the U.S., but shopping at
U.S. websites. This is a consistent 6 percent trend that also occurred
last year in 2009 – but last year’s 6 percent was out of $887 million
whereas this year’s 6 percent was out of $1.028 billion…and I, for one,
did my part and bought online from U.S. retailers on Cyber Monday.
http://blog.comscore.com/2011/01/e-commerce_in_asia_pacific.html
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