Global E-Commerce Market (by Product Categories, Model Type, & Region: Insights and Forecast with Potential Impact of COVID-19 (2022-2027)

In recent years, sales through e-commerce platforms have grown at a fast pace. E-commerce has evolved considerably over the years. Over the last decade, the progress of both technology hardware and the internet has been directly related to e-commerce. In many ways, e-commerce has evolved to rival traditional shopping, just as the internet has become the preferred medium for marketing, advertising, and purchasing of items, goods, and services.

E-commerce is a platform that allows buyers and sellers to buy and sell products and services online. The online platforms can be accessed by a mobile phone, laptop, or computer via the internet. The further expansion of e-commerce is inevitable owing to the proliferation of mobile and ubiquitous internet access. Traditional brick-and-mortar sectors are rapidly moving online. The global e-commerce market is predicted to record a value of US$20.30 trillion in 2023, witnessing growth at a CAGR of 26.55%, during the forecasted period.

Segment Covered

By Product Categories: In terms of product categories, the report bifurcates the global e-commerce market into six segments: fashion, toys, hobby and DIY, electronic & media, food & personal care, furniture & appliances and others. The fashion segment held the maximum share in e-commerce market, owing to digital innovation, increased online access and smartphone penetration, and emerging global middle classes with disposable income.

By Model Type: The market report splits the e-commerce market into two different segments, on the basis of application: business to business (B2B) and business to consumers (B2C). The Business to Business (B2B) segment is the fastest growing segment with highest CAGR during forecast period, owing to the growing importance of technologies, such as AI, AR, and VR, in influencing consumer purchase decisions.

Geographic Coverage

According to this report, the global market can be divided into four major regions: Asia Pacific, North America, Europe, and Rest of the World (ROW). The countries covered in Asia Pacific region are China, India, Japan, South Korea, and Rest of Asia Pacific, while North America includes the US, Mexico, and Canada. Moreover, UK, Germany, France, Spain, and Rest of Europe are included in the Europe region. Asia Pacific is the world's largest e-commerce market. The region's growing middle class, combined with higher levels of disposable income, has increased internet access and smartphone ownership, resulting in enormous growth in the Asia Pacific region's e-commerce sector in recent years. Until now, the story of e-commerce has been one of regional disparities. China has seen the most significant growth, as China is one of the world's biggest e-commerce marketplaces and digital technology users, with massive sales volumes, high innovation, and a thriving social and mobile commerce ecosystem.

Top Impacting Factors

Growth Drivers

• Increasing Internet Connectivity
• Surging Gen Z and Millennial Population
• Increasing Adoption of M-Commerce
• Growing Acceptance of Digital Transactions

Challenges

• Rising Malware Applications
• Ambiguity with Cross Border Trade

Trends

• Increase in Mobile 5G Subscriptions
• Growing Influence of Social Media
• Expansion of E-commerce Share in Total Retail Sales
• Rising Popularity of Self Service Platforms

Driver: Increasing Internet Connectivity

Internet is a medium, as a technical infrastructure, which helps to drive sales to business. The broader access to internet could explain the greater internet usage to find information about good and services and support the expansion of e-commerce market. Also, as a vast network of people and information, the internet is an enabler for e-commerce as it allows businesses to showcase and sell their products and services online and gives potential customers, prospects, and business partners access to information about these businesses and their products and services that would lead to purchase. Thus, the surging internet users would drive the growth of the e-commerce market in the coming year.

Challenge: Rising Malware Applications

The e-commerce industry is known to be the highest vulnerable industry in terms of cybersecurity. Despite having a good marketing strategy and remarkable website design, the entire website, as well as the firm, can be easily ruined by a simple cyber threat. Malware attacks hijack the targeted user’s system, web server, and all the confidential data for some time and demand a certain amount of money in exchange for returning the user’s data. It is a threat for e-commerce websites as it loses the trust of customers. Therefore, the rising malware applications would negatively impact the growth of the e-commerce market.

Trend: Growing Influence of Social Media

Social media is the most critical element in the e-commerce genre. Social media platforms aim at improving the interaction between the clients and ecommerce businesses instead of just educating them about profitable deals and new product launches. A part of the social media platforms allows direct selling by utilizing a couple of social groups and communities. It sets up two-way communication in a desirable community, yet additionally, strikingly prompts client retention. Thus, the influence of social media is continuously expanding in the overall e-commerce industry.

The COVID-19 Analysis

The global e-commerce market was impacted in many ways by the COVID-19 pandemic. The COVID-19 brought in many changes in the world, digital transformation of economic activities was seen taking place rapidly, in addition to this the world witnessed limiting shopping (but purchase of only essential goods or services), growing startups entering online business, major jump in its purchases in hardware and sporting goods, and greater reliance on real-time and digital payments. The changes brought in by COVID-19, such as rapid shift to online, mobile first, omnichannel, etc., are looked to have long term impact in the post COVID era.

Analysis of Key Players

Due to the pandemic, online retail has risen to prominence and become a requirement for many companies. As a result, the market is considered as fragmented, and strong rivalry is likely in the upcoming years. Many companies are employing various techniques to maintain their position in the e-commerce market. Further, key players in the e-commerce market are Amazon.com, Inc., The Home Depot, Inc., Walmart Inc., Zalando SE, Alibaba Group Holding Limited, eBay Inc., Shopify Inc., Apple Inc., Wayfair Inc., Rakuten Group, Inc., Meituan and JD.com, Inc.

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