Regarding online sales, the world’s largest eCommerce markets are China, Spain, Canada, the Philippines, the United Kingdom, and Germany. These countries have advanced online shopping technologies and are leading the way worldwide. Each country has different characteristics and a unique eCommerce ecosystem. However, some of these countries are more advanced than others and expected to grow faster than their counterparts.
China
China’s growing internet penetration and smartphone usage have fueled eCommerce. More than 800 million people use the internet in China. Last year alone, thirty million Chinese people went online for the first time. Internet use in China now surpasses the numbers in the United States, Indonesia, and Brazil. China’s internet users are big fans of online shopping. The country’s vast logistics ecosystem also supports the eCommerce industry’s growth.
While China’s eCommerce market continues to increase, it is maturing. It’s expected to grow by only 15% between now and 2025. By contrast, the rest of the world will grow by 52%. For the next three years, the digital retail market in North America is expected to approach $1 trillion in sales. By 2020, Latin America will leapfrog Central and Eastern Europe’s eCommerce space.
The growth of eCommerce in China has been impressive, with over $1.4 trillion in sales last year. Chinese eCommerce sales are expected to surpass US retail sales by 2020. This means that China’s e-commerce market will overtake the United States and the United Kingdom in total sales. It will also be the first country in the world to exceed the United States in terms of online sales.
With a growing population and eCommerce market, China is poised to lead the way in the online millennium. The Coronavirus, which killed thousands of people in 2014, temporarily halted China’s daily life and sparked a wave of online shopping. In response, consumers started buying household goods and medicines online, which fueled the rapid growth of Chinese eCommerce.
Spain
The Spanish e-commerce market is highly fragmented, with multiple players of different sizes. This makes the market highly competitive. There are also several mergers and acquisitions expected in the coming years. Companies in the sector also invest in new technologies and products to counteract current strategic slowdowns. While credit and debit cards remain the primary payment methods, digital wallets and direct bank transfers are becoming more prevalent.
In Spain, 26.2 million people are active eCommerce users. According to Ecommerce Europe, the most preferred payment method is PayPal, followed by credit cards and debit cards. Consumers should also choose a reliable payment service provider to avoid credit card fraud. Besides, consumers should also consider other buyers’ opinions before purchasing. Another factor that consumers believe in buying online is convenience.
Spain’s consumers are increasingly conscious of diversity and authenticity. In addition, they also hold higher expectations for personalized shopping experiences. Furthermore, e-commerce has grown in popularity in Spain as a result of the trust that consumers have in brands. However, many people still prefer shopping in physical stores.
The eCommerce market in Spain is expected to grow by 7.4 percent by 2020. The 2020 lockdown has accelerated the growth of eCommerce in Spain, but not in all sectors. It has boosted the eCommerce market in the fashion industry, which almost doubled its market share. Fashion players like Inditex and Mango are increasingly adopting omnichannel solutions to drive more online traffic.
AliExpress, Alibaba’s cross-border e-commerce platform, has entered the Spanish market with a supermarket service. The new partnership with Spanish internet operator Lola Market has given shoppers access to thousands of products in thirteen food markets in Spain.
Canada
Despite the country’s size, Canada’s e-commerce market is still in its developmental phase. As of June 2019, Canada’s eCommerce revenue was $34.9 billion. However, between March and May 2020, Canadian online sales almost doubled. A particular increase was seen in the apparel category, with online revenue growing by 21%.
Internet penetration in Canada is high, and its population of 96.3 million people is among the world’s most internet-savvy citizens. This makes the eCommerce market in Canada particularly profitable. According to the World Wide Web Association, eCommerce in Canada will reach $1.2 trillion by 2020. This is much higher than the global e-commerce market, which will grow only 32.5% annually. The country’s medium-sized population and relatively stable economic situation make it a prime market for eCommerce. In addition, major American e-commerce companies dominate the Canadian eCommerce sector. However, some local players have gained a foothold.
The top three online retailers in Canada offer products for various needs. For example, Home Depot Canada focuses on home improvement products, including patio furniture, power tools, and associated services. On the other hand, Newegg is a Canadian retailer of computer hardware, consumer electronics, and professional electronics. It launched in Canada in 2009 and catered to audiences seeking technology. The US brands dominate the top 10 online retail markets, but the rapid digitization of retail is likely to transform the retail landscape in Canada.
Although Canada is not the largest eCommerce market in the world, it is rapidly becoming one of the most profitable markets for eCommerce companies. ECommerce sales in Canada are forecasted to increase by over 56% until March 2021. It is the ninth largest eCommerce market globally, accounting for nearly 5% of its total merchandise value.
Philippines
With over 7,600 islands, the Philippines is a vast eCommerce market, but the Philippines also presents logistical challenges. The lack of shopping malls and other physical retail outlets makes the country a difficult place to sell items online. Because of this, online sellers need to work with a reliable cross-border shipping partner and last-mile delivery service provider. These services can send packages across the country without drastically increasing shipping costs.
The country’s growing population is home to some of the largest eCommerce platforms in Asia. Leading online marketplaces in the country include Shopee, Lazada, and Zalora. These platforms cater to a diverse consumer base with many products sourced from the Asia-Pacific region. Popular product categories include beauty, electronics, fashion, furniture, and household care. The country also has high smartphone penetration, with 74.1% expected by 2021.
The Philippine e-commerce sector is working to replicate the in-store experience for consumers. Many Filipino consumers still prefer to interact with store employees. For example, some e-commerce companies have experimented with letting consumers use messaging apps to seek assistance. Other players will blend e-commerce with physical retail outlets in the coming years.
Social media is also essential in the Philippines’ e-commerce scene. Among the most popular social media platforms in the country, Facebook is especially prominent. The social platform has become a hub for many online stores. In 2017, Facebook Marketplace saw a 1000% growth in its food service sector. This industry is booming, and many Filipinos are embracing this platform.
The e-commerce market has continued to grow in the Philippines over the past three years. The industry is estimated to reach US$4 billion in revenue and is expected to top US$15 billion by 2025. The country’s eCommerce market has enormous potential for growth, which remains underdeveloped. Consumers are beginning to appreciate the convenience of online transactions and the convenience of shopping online.
UK
The UK’s B2C eCommerce market is the world’s third largest, with 96% of the population using the internet and 86% planning to purchase in 2019. The country’s economy is growing at a rate of more than 4% per year, and its online retail industry continues to grow. The UK ranks highly on all key e-commerce indices, including Logistics Performance, Ease of Doing Business, and E-Government Development. However, the UK’s eCommerce market is becoming increasingly dominated by a small number of big players.
The UK’s eCommerce market is primarily dominated by Amazon, which is increasing. According to a Merchant Advice Service survey, nearly seven in 10 online retailers in the UK use PayPal as their primary payment processor. The survey also found that over one-quarter of UK consumers use a digital wallet, and twenty-four percent of online shoppers prefer to pay later options. In addition, books, magazines, and movies are some of the most popular product categories.
The UK’s eCommerce market is growing fast and is forecast to reach PS260 billion in 2025. Its continued growth is a cause for concern for brick-and-mortar retailers, who are increasingly turning to online channels to increase their revenue. As a result, physical sales may be replaced by online purchases. But several factors will influence how far e-commerce grows in the UK.
Card payments are the most popular method of payment in the UK. Nearly ninety percent of the population has at least one debit or credit card. And despite the increasing popularity of eCommerce, the British are often reluctant to use other payment methods.
