Wednesday, 24 February 2016

Global E-Commerce Market and its Potential

The e-commerce industry is one of the lucrative sectors worldwide. With the emergence of e-commerce, store-based retailers are finding minimal need for the retail space they currently occupy. In accordance to this trend is the groing private label penetration as retailers seek diverse initiatives to remain competitive, retain customers and protect profit margins. Online sales of apparel and accessories are now growing at a rapid pace as compared to any other ecommerce product segment. 

The biggest driving factor for the tremendous growth in the e-commerce industry is the adoption of smartphones, tablets and other internet devices. Consumers preferably use mobile browsers when shopping, or searching for entertainment, while they prefer applications for navigation and collecting information. The continued advancements in technology are transforming the navigation and customer experience on e-retail sites, which is improving reviews and thus drawing more traffic to the sites. Innovative shopping models and loyalty programs are drawing sales away from brick-and-mortar operations. 

The Global e-commerce sales is likely to cross US$ 3 Trillion mark within the next five years. The rapidly growing Asia-Pacific market is likely to fuel a 25% year-over-year growth in globale-commerce market.  North America is the largest regional market in e-commerce. Together, China and the US accounted for more than 55% of global e-commerce sales in 2014. China's growth during the next five years will widen the gap between the two countries.

Amazon despite of being the leading player in United States e-commerce market controls around 18% share, while in the Chinese e-commerce market, Alibaba is the biggest player controlling around 80% market share alone. Alibaba’s e-commerce sales are higher than the combined sales of eBay and Amazon. In India Flipkart, Amazon and Snapdeal are the leading players in e-commerce landscape.

The biggest challenge faced by the e-commerce market is the logistics. The shortage of high-quality logistics providers results in: lost parcels, damaged goods, lost deliveries, poor reverse logistics and no special services. The online payment method is also a point of concern for many buyers as they are afraid of sharing personal and card information due to security thefts.

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