Earlier this year, Nielsen published a valuable report called “Global Connected E-commerce: Is E-tail Therapy the New Retail Therapy?” The research company surveyed more than 13,000 consumers in 26 countries to provide insight into how global e-commerce is evolving. The results are essential reading for global companies, startups hoping to sell in the global e-commerce market and marketers looking for an understanding of e-commerce trends and important differences in global markets.
Six key findings
Here’s a list of six key findings worth noting in the report:
- global e-commerce will double from 2015 to 2019 and account for 12% of all retail sales.
- cross-border e-commerce is growing: 57% of consumers said they had bought something oonline from an overseas retailer in the past six months.
- most commonly used payment methods were credit card (53%) and digital payment systems (43%), although cash on delivery is common in developing markets.
- 49% say they shop online to get grocery products they can’t find in physical stores.
- 57% of online respondents doubt e-commerce sites will keep their personal information secure and confidential.
- Six-in-10 online respondents say they’ll only shop online for electronics (62%) and mobile products (61%) if it saves them money.
Global customer journey changing
As marketers and Amazon know, the customer journey is changing rapidly. According to Nielsen, “e-tail therapy” is quickly replacing retail therapy. Shoppers now grab the nearest mobile device and begin with a search at home or on the move with a series of digital touch points including:
- research and information gathering – for example 63% looked up travel and service information; consumer electronics (60%); beauty/personal products (54%); grocery products (34%)
- online reviews
- social recommendations from friends, family and colleagues – depending on the product, 4%-8% liked, tweeted or shared info on social media
- in-store product comparison and price checking – 52% compared prices on travel and consumer electronics; beauty/personal products (44%); groceries (39%)
- depending on the product from 30%-46% searched for coupons, promotions or deals
- 5%-8% subscribed to store/product emails
- most consumers switching seamlessly from one device to another.
Cultural differences in online shopping
The research report highlights a number of interesting cultural differences that illustrate the challenges of many channels and many countries for global marketers. For example:
- 77% of South Koreans vs 67% in the UK bought fashions online
- in Japan, 79% bought books, music & stationery compared to 64% in the US
- 67% in Spain bought travel vs 47% in Germany
- 57% in Brazil bought electronics products compared with 48% in Poland
- in South Korea, 57% purchased beauty/personal products vs 47% in Germany
- 37% in UK bought fresh grocery products vs 18% in Australia.
China & France top-performing e-commerce countries
In China and France, e-commerce is critical for certain key product categories.
For example, in China, 33% (up 40% over previous year) of baby products and 25% (up 35% over previous year) of personal care products are sold online. If you’re a consumer packaged goods manufacturer, you need to reach Chinese consumers online for a larger share of some products sales in the market.
In France, “click and drive” is the primary e-commerce activity. French consumers order their products online and pick them up in the store. The total percentage of sales is small in each category but is growing quickly:
For example, e-commerce accounts for 4% of frozen food, paper good, non-alcoholic beverage and refrigerated dairy sales. Online sales for the frozen food category, however, grew 16.8% over the 52 weeks ending April 2015, compared with a 1.3% decline for brick-and-mortar stores. For alcoholic beverages, online sales grew 25.1%, while offline grew 1.2% over the same period.
The value of this global report is to compare and contrast your own market with others and to be aware of future trends.
Cross-border commerce growing
57% of consumers surveyed said they had purchased from an overseas retailer in the previous six months. In Europe, that’s easily explained by the close proximity to many neighboring countries despite challenges in logistics and deliveries between some countries.
Here’s a selection of the percentage of consumers who bought online from an overseas seller:
- Latin America – 69% in Chile, 64% Mexico, 42% Argentina
- Asia-Pacific – 74% in India, 66% Australia, 58% China, 32% Japan
- Europe – 79% Italy, 73% Germany, 64% Russia, 52% UK, 34% Poland
- North America – 62% Canada, 29% US
- Africa – 61% Nigeria, 50% South Africa.
If you’re looking at the next market to expand and sell your products overseas, this research will give you some valuable benchmarks.
How do payments vary by country?
The Nielsen report highlights some fascinating differences in payment preferences due to cultural differences, technology, local retailers and international payment procedures. We expect to see payment choices evolve globally with some changes as developing markets mature and new payment technologies are introduced.
Here’s a quick collection of highlights showing how payments vary by country:
- Globally: payments by credit card (53%), digital payments (43%) and debit cards (39%)
- Western Europe: digital payments (56%), credit card (44%), debit card (42%)
- Eastern Europe: cash on delivery (57%), direct debit (55%), credit card (46%)
- China: digital payments (86%), direct debit (53%), cash on delivery (49%)
- North America: credit card (74%), digital payments (38%), store-specific gift cards (26%)
- India: cash on delivery (83%), debit card (71%), direct debit (61%)
- Africa: cash on delivery (54%), debit card (42%), direct debit (42%)
- Latin America: credit card (65%), debit card (41%), digital payments (36%)
- Middle East: cash on delivery (64%), credit card (46%), debit card (11%).
These payment differences can be a challenge for some companies depending on payment service providers, financial institution and country specific laws and regulations. Choosing the right payment processing partner is critical for global marketers.
Free Nielsen report
We hope you enjoyed today’s look at global e-commerce and cross-border commerce. There’s a wealth of information and insight in this free 38-page research report. You can download your copy directly from Nielsen here.