Between Amazon and Alibaba, it is easy to forget that e-commerce is still coming of age. Yes, business has been booming online for years in many developed countries, but e-commerce is still not the world’s biggest retail channel. That will happen in 2021, when it will account for 14% of total retail sales, according to Euromonitor International. Between then and now, expect dramatic surges in online purchases in places such as Vietnam and the United Arab Emirates.
Vietnam saw 20% growth in its e-commerce numbers last year, according to The Hanoi Times. Some experts predict that number will increase to 30% to 50% over the next few years.
“In the past couple of years, marketplaces like Lazada, Rakuten, Flipkart and Shopee have made it easy for Vietnamese merchants to sell online within the APAC region and gave them the experience they needed to further expand around the world,” Miguel Warren, regional head of Southeast Asia at Payoneer Philippines, told Forbes.
China is on pace to replace the U.S. as the world’s largest retail market—with online sales as the primary driver.
Meanwhile, since 2014, the number of online shoppers in Africa has continued to grow about 18% every year, aided by an increase in internet connections, smartphone sales and a burgeoning middle class. And in the United Arab Emirates—the top market in the Middle East—online sales doubled between 2015 and 2017, according to ResearchandMarkets.com.
Meanwhile, China is on pace to replace the U.S. as the world’s largest retail market—with online sales as the primary driver. (China’s e-commerce sales account for 35% of its total retail sales, whereas in the U.S., it’s only 10%.)
With the introduction of new technologies such as 5G, which promises to make the internet not only faster but more accessible to rural and emerging economies, e-commerce’s dominance is all but in the bag.
This article appeared in the Fall 2019 issue of Insigniam Quarterly, with the headline “E-commerce’s Next Growth Spurt.” To begin receiving IQ, go here.