There has been some confusion regarding ecommerce growth over the past couple of years. Online shopping grew exponentially during the pandemic, which naturally slowed as offline shopping opened up again. However, the growth of ecommerce around the world continues, even as the digital market share drops to more normal levels. The following data supports and demonstrates this growth.
London, UK, October 4, 2023: The global ecommerce market is being democratized by ecommerce-as-a-service companies, like Shopify, and marketplaces, like Amazon and Alibaba, that allow anyone to become a merchant. Alongside this, improved technology, new delivery services, and wider internet adoption will help the global value of ecommerce transactions hit $9.3 trillion by 2027, growing at a compound annual growth rate (CAGR) of 9.5% from 2022, according to GlobalData, a leading data and analytics company.
GlobalData’s latest report, “Ecommerce,” reveals that global ecommerce transactions grew from $2.5 trillion in 2016 to $5.9 trillion in 2022 at a compound annual growth rate (CAGR) of 15%. COVID-19 was a crucial factor in this growth as the pandemic lockdowns accelerated the shift to online shopping.
Aisha U-K Umaru, Analyst, Thematic Intelligence at GlobalData, comments, “Although the ecommerce industry will grow globally, key geographical disparities can be observed. The US and China currently dominate the market and will account for over half of the ecommerce industry’s value in 2027. However, emerging markets should not be overlooked.”
India is one of the world’s fastest-growing ecommerce markets, and GlobalData expects Indian ecommerce spending to grow at a CAGR of 23% between 2022 and 2027. This is primarily thanks to its massive population, increased internet and smartphone penetration, and growing consumer purchasing power.
Ecommerce is an extremely fragmented market. Within each sector, one or two players typically dominate, while the mega-players – those with a presence across the ecommerce ecosystem – challenge each other for leadership in as many niche segments as possible. However, regulatory bodies that hold antitrust and data privacy concerns may prohibit the internet super-monopolies’ plans to continue their expansion.
“We have seen regulators try to stop M&A deals, such as Microsoft’s acquisition of Activision Blizzard,” Umaru continues. “With this rhetoric of anti-competitive regulation, it will be interesting to see new players emerge to challenge the incumbents.”
The barriers to entering the ecommerce market are being abolished by ecommerce as a service players that help anyone sell products online. Online marketplaces also enable new merchants to enter the ecommerce industry. They exist across sectors, from restaurant marketplaces to gaming marketplaces.
“Companies like Shopify and Squarespace allow merchants of all sizes to build ecommerce shop fronts at low fees and without the need for any coding experience,” Umaru concludes. “Marketplaces such as Amazon and Alibaba also facilitate this ecommerce democratization by allowing sellers to tap into their ecommerce infrastructure and audience. As more and more sellers go online, it will be interesting to see how the ecommerce landscape will evolve to provide for the ever-expanding range of goods on offer.”
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