31 July 2013 – Internet retailing in Asia Pacific is growing at an unprecedented rate, increasing by 188 percent in real terms between 2007 and 2012, the largest increase globally during that time, according to Euromonitor International.
Asia Pacific’s internet retailing market is currently second only to North America. While more developed economies such as Japan and South Korea have already had e-tailing for 10 years and opportunities in these economies are constrained, Euromonitor International sees plenty of possibilities in other countries in the region.
Pavel Marceux, Technology, Euromonitor International's Communications and Media Analyst, said that the greatest number of opportunities exist in highly-populated countries such as China, India and Indonesia, where consumers are increasingly gaining access to broadband internet, driving up the previously underdeveloped retailing segment.
Marceux added that in this region e-commerce has shown a “leap-frogging effect”. In the West, traditional in-store retailers have led the move to internet retailing. However, in markets such as China and India manufacturers are by passing traditional retailers and sending their goods directly to online marketplaces.
Moreover, as a lot of people in India and China live in rural areas they don’t have access to in-store retailing spaces, so a lot of purchasing decisions are made online and consumers rely on mail orders to receive goods, according to Marceux.
As such the online market is a “vibrant and serious competitor” with traditional stores, he said.
In fact, the Asia Pacific e-tailing market is expected to overtake North America to become the biggest e-commerce market in the world, Marceux said, driven not only by its huge population but also by rising incomes and IT literacy.
In addition, government programmes and operator coverage programmes are getting more people online and connected to faster broadband options and payment gateways, equipping them to make purchases online.
“All this is expected to come together to drive probably the most dynamic, e-commerce segment in the world,” he said.