The paper highlights the seven most significant digitally relevant megatrends occurring in China, the world’s biggest e-commerce market and how these are set to have a profound impact on e-commerce trend development across the Asia Pacific region and beyond.
COVID-19 has catalysed e-commerce growth globally. While businesses of all sizes want to capitalize on it, leaders in this space are reimagining new frontiers for e-commerce.
The paper examines the drivers of the shift in consumer behaviors and attitudes, revealing trends that businesses should consider to map out long-term e-commerce strategies.
Kawal Preet, the President of the APAC and AMEA regions at FedEx Express offered insights.
“Our research shows that the Asia Pacific, Middle East and Africa (AMEA) region is projected to be at the forefront of this e-commerce market growth for many years to come.”
“With rising disposable incomes, growing internet penetration, and emerging cross-border e-commerce markets, there is a huge amount of growth yet to be realized here.”
“Logistics is the backbone of the whole e-commerce ecosystem. The simplicity of the click to buy aspect must, in exchange, be matched by the speed and convenience of delivery.”
“We are building networks to offer smart supply chain solutions and personalized delivery services for businesses to unlock new opportunities as e-commerce advances.”
“As consumers aspire to live their best lives through connected, immersive, sharable and engaging digital services, businesses want to stay a step ahead of meeting those expectations.”
“Logistics now sits at the intersection of this physical and digital world.”
“This means we have a vital role to play in shaping the future of e-commerce, creating more cross-border options for consumers and SME businesses alike,” Preet added.
E-commerce is expected to grow at an average of 47% in the next 5 years globally. The Asian market leads the field at 51%, followed by Europe (42%) and North America (35%).
In the Middle East and Africa, the e-commerce market value will reach $73bn by 2025.
However, growth in China, in particular, has eclipsed the rest of Asia, with e-commerce sales in 2020 that reached $1.3 trillion with a projected increase to nearly $2 trillion by 2025.
The promising outlook also creates vast opportunities for logistics companies to grow.
The global E-Commerce Logistics market is projected to register the highest gains of approximately 6.6% year-on-year during 2021-2028, reaching $118,847 million by 2028.
Some of the opportunities emerging from this white paper are in the following areas.
Customer experience redefined
The white paper reveals several megatrends around the confluence of smart cities and homes, connected consumers, experiential marketing, and reinventing shopping experience, making shopping no longer siloed as the blurring of lines between online and offline continue.
In China, North America and Europe where infrastructures and technology are advanced stage, consumers look for elevated retail experiences through tech-rich offerings.
These offerings include Cloud Shelf and Augmented Reality (AR) mirrors in an offline store, or a virtual reality (VR) hotel tour, or livestreaming purchasing experience on mobile.
With the 5G reality, businesses can harness the power of new technologies such as Near Field Communications, Artificial Intelligence, bots to provide highly digitalized and personalized services, bringing enhanced, connected customer experiences beyond retail.
The logistic industry is also working to provide customers with advanced analytics.
FedEx Surround collects and combines relevant data about packages as they travel globally to offer more visibility, predictive advisories and opportunities for proactive interventions.
Reaching the unreached
Another megatrend gaining ground is around Shifting market frontiers.
As some areas become over-farmed, over-populated or otherwise reach their maximum potential, opportunities in tier-2 cities and rural areas emerge for brands to explore.
Conventional retailers plus mom-and-pop stores are connecting with customers via business to business (B2B) e-commerce platforms and selling products online globally.
Benefiting from advanced digital and transportation infrastructure, together with the rising middle classes in tier-2 cities, China, APAC and the Middle East are spearheading a revival in conventional retail and mom-and-pop stores through digital commerce.
Competition in these untapped landscapes is likely to intensify in the years to come.
Cross-border logistics, broader network coverage and ease of connectivity will eventually support the increasing penetration of e-commerce players and the winners will be those companies who move first and build a deep rooted, broad reach across customers.
Cashing on convenience
The sharing economy and buying time are the two other megatrends that are being witnessed as rising urbanization, advanced digital infrastructure and consumers’ changing attitude towards ownership continues to drive the growth of the sharing economy.
The shared economy is set to become a $335 billion segment globally by 2025.
North America and Europe are currently in the lead. However, in China, more than half of the population are estimated to participate in it. Convenience is the underlining factor encouraging brands to cross-collaborate and innovate to meet consumers’ needs.
From car-sharing and apartment renting to group-buying, consumers’ demand for shared services is fostering groundbreaking innovations. Among these, e-commerce has become a critical time-saver for consumers, providing fulfillment with just a click.
However, with consumers’ rising disposable incomes, demand for an on-demand serviced life is set to soar. Globally, 48% of consumers want to spend money to save time.
Businesses in North America and Europe are at the forefront of redefining the future of this on-demand serviced economy with potentials to grow revenue by doorstep delivery.
Cross-border e-commerce solutions like FedEx® International Connect Plus (FICP), which provides value for money and competitive speed, and delivery customization solutions like FedEx® Delivery Manager International allows e-tailers to offer their customers the personalized service, and freedom to manage and control their shipping preferences.
Salil Chari, the Senior Vice President of Marketing & Customer Experience for Asia Pacific (APAC), Middle East and Africa (AMEA) at FedEx Express offered additional insights.
“We are living in exciting times where the latest technologies are constantly shaping human behavior and therefore ushering in the next wave of the e-commerce revolution.”
“Through enhanced connectivity, on-demand services and shared economy, a new era of e-commerce is opening new options for SMBs to compete on the global stage.”
“To win, businesses must continue to rethink and reinvent how and where they engage with consumers. This white paper is important as it signals where these opportunities lie.”
The future is of e-commerce is here.
For logistics players, these megatrends are helping to provide a clear roadmap on where the industry is headed, and having a digital-first, innovation led e-commerce ecosystem which reduces delivery challenges and optimizes operational efficiency is a priority.
Already, FedEx has made several strides, forming strategic collaborations with leading e-commerce players and technology companies to modernize its supply chain.
With new technologies like big data, robotics and AI, more innovations are on the horizon.
To gain more insights on how to take advantage of these new e-commerce trends and opportunities and level-up your supply chain, download this white paper here.