Asia Pacific ecommerce to reach USD 1.4 trln in 2017 – survey

Friday 25 August 2017 11:02 CET | News

Asia Pacific ecommerce market is forecast to reach USD 1.4 trillion in 2017, up from USD 535 billion in 2013, representing a CAGR (compound annual growth) of 27% between 2013 and 2017.

These are the findings from a survey conducted by GlobalData, Consumer Payments Insight Survey, which reveals the extent of Asian consumers’ demand for mobile apps, smartphones and digital wallets when purchasing online.

The CAGR (compound annual growth) of 27% is much higher than Europe and North America which registered respective CAGRs of 14% and 13%.

The bulk of online spending in Asia comes from China, which surpassed the US in 2014 to become the largest e commerce market globally. China accounts for 75% of ecommerce sales among the 15 Asian markets covered in GlobalData’s E-commerce Analytics database.

Japan and India are the second and third largest ecommerce markets accounting for 10% and 3% of ecommerce by overall transaction.

An interesting fact is that consumers in the most developed countries still use cards as the preferred payment method whereas consumers in Asia prefer to use digital and mobile wallets (for example Alipay, Paytm, etc.) when shopping online.

As shown by GlobalData, 47% of total ecommerce transaction value in Asia Pacific was carried out using digital and mobile wallets in 2017. Payment cards, bank transfers, and cash/cheques account for 28%, 13%, and 11% respectively.

The growth of new payment methods in Asia Pacific largely comes at the expense of payment cards. The total share of digital and mobile wallets for ecommerce payments in Singapore doubled from 10% in 2013 to 22% in 2017, while debit and credit cards account for 42% – declining from 55% in 2013. Similarly, in India, the share of digital and mobile wallets tripled from 7% to 29% during the same period.

GlobalData’s Consumer Payments Insight Survey also finds that comfort and security are increasingly important drivers of choice when it comes to digital and mobile wallets, which are perceived to be more secure than card payments.

To seize this opportunity, local and international payment service providers, banks and mobile operators have made significant investment in this space. While global players, including PayPal, Apple Pay, and Android Pay have forayed into Asian markets, so far they have struggled to compete with well-established local payment solutions.

GlobalData’s survey confirms that Alipay holds a 40% share in the Chinese ecommerce market, while Paytm holds a 10% share of the Indian ecommerce market. In contrast, Apple Pay, launched in Australia in November 2015, holds only a 2.7% share in that country’s ecommerce market, its strongest presence in the region, while Android Pay has a 0.4% share.

There is a strong preference towards using mobile technology for ecommerce transactions in Asia Pacific with 56% of ecommerce transactions in China carried out on smartphones and/or tablets – in contrast with 23% and 26% in the developed markets of the US, and the UK respectively.

The majority of these transactions in China are carried out in-app, with 70% of respondents preferring a mobile app when conducting online transactions.

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Keywords: Asia Pacific, ecommerce, survey, CAGR, market
Categories: Payments & Commerce | Ecommerce
Countries: World
This article is part of category

Payments & Commerce