Despite the pandemic wreaking havoc in various industries and economies, a key player has been steadily rising: e-commerce. Even without seeing the exact figures, you’re sure to feel the boom of e-commerce in the Philippines in various ways. It can be in the packages delivered to your house daily, or it can be in simply checking out your online cart more often than before. This has become a norm since the pandemic started due to lockdowns limiting physical stores from their businesses and general public health safety concerns. But how exactly has the e-commerce industry been performing in the country numbers-wise?
PH e-commerce to hit $15 billion by 2025
In a report by BusinessWorld, an analysis made by Franklin Templeton Emerging Markets Equity said that the gross merchandise value of the e-commerce industry in the country is projected to reach $15 billion by 2025 despite having a low penetration rate of 5% compared to the average 6% in Southeast Asia. Penetration rate aside, the e-commerce industry’s reported gross merchandise value of $4 billion last year indicates the increasing use and demand.
“With the Philippines having a young population dominated by Millennials and Gen-zeds, we can expect that e-commerce is just on its way to becoming a dominant industry in the market. Most catalysts for growth are present, such as improving internet speeds, growing popularity of digital payments, and increasing logistics companies’ investments for order fulfillment. All systems go!” said Marvin Ortiz, Managing Partner of LeapOut, a digital and e-commerce company based in Manila.
In a separate write-up made by Manila Bulletin, it was reported that online shopping transactions have soared up to 325% ever since the pandemic started. Additionally, with how insistent Filipinos were on cash-based transactions before, the pandemic has resulted in more Filipinos turning over to the online method, as reflected by website traffic on major shopping websites. For example, Ken Research’s analysis states that Lazada’s traffic had 30.47 million monthly visits in Q2 2020, signifying a massive increase from the 26.76 million monthly visits it gained from the first quarter.
Plain and simple, all these numbers indicate that the e-commerce industry is becoming a powerful force compared to physical stores. And with how the COVID-19 pandemic is still ongoing, e-commerce’s dominance is here to stay.
Challenges of e-commerce in the pandemic
Despite e-commerce performing well during this global health crisis, there are still challenges along the way. A survey conducted by Vesta states that safety and security are still cause for concern among Filipino e-commerce shoppers. Fraud, identity theft, and hacking are just some of the significant security concerns your potential customers are worried about. So for those looking to set up their e-commerce websites, partnering with an expert is the way to go to ensure both you and your customers that each transaction is secure.
Additionally, with more and more online shops popping up to take advantage of the current situation, there are many more inexperienced sellers looking to go online that need help. Some of them may be unfamiliar with how it works. Therefore, they would need help in employing the proper strategies to reach their audience. With so many possibilities and platforms to use, they might end up choosing the least effective tool to reach their potential audience without proper guidance. With this, it’s better to have a team of experts doing the legwork for this rather than trial and error yourself and potentially cause business losses.
The e-commerce industry, as it’s currently rising amid the global health situation, has massive untapped potential in terms of businesses. It isn’t easy for many, especially those who are used to the physical means of selling their products. But with the help of a digital marketing agency and e-commerce experts, your business can also thrive in this new online landscape.