The growth of e-commerce seen in 2020 continued at breakneck speed until about mid-2021. We’re now seeing signs of it slowing down. China, the US, the UK, and the Netherlands all are reporting a downturn from the real height of the pandemic: Amazon’s revenue in the third quarter rose 15 per cent, down from 37 per cent growth in the same period a year ago.
Throughout Cyber Week— Thanksgiving Day through Cyber Monday — US consumers spent 1.4 per cent less than last year. Alibaba’s 11.11 event this year experienced slow growth, 8.5 per cent compared to 25 per cent growth last year.
Still, whilst the growth may have slowed, the current levels of e-commerce continues to break records.
Shopee’s parent company Sea Ltd. has just posted US$1.5 billion in revenue for Q3 2021, up by 134.4 per cent year-on-year. FedEx estimates it will drop off an estimated 100 million more packages than it did in pre-pandemic 2019.
People continue to shop online but now expect slicker digital experiences, frictionless checkout, and speedy delivery. These new habits have taken root, and consumers are more demanding than ever.
To cater to these expectations, businesses are paying more attention to the checkout page’s last, crucial part of a transaction. Providing payment choices at the checkout – whether that’s Grabpay in Singapore or GoPay in Indonesia – will drive conversion and hence growth with the local consumers.
With cart abandonment rates sky high, it’s important to remember that nearly one in five consumers will stop a transaction if their preferred way to pay isn’t accepted.
Also Read: A look back at 2021: Digitalisation, innovation and sustainability
PPRO continues to see payment service providers (PSPs) and their merchant customers contacting us looking for seamless, robust payments infrastructure to prioritise their customer preferences.
They have partnered with us to do all the heavy lifting. In the past 12 months, we’ve more than doubled our transaction volumes. We’ve scaled to hire over 230 payments experts, bringing our entire global team to over 460.
It’s all been to meet the e-commerce demand of payment service providers and the businesses they support.
Powering payment choices across Asia is complex, but the rewards for merchants looking for hypergrowth are clear. By 2030, the digital economy in Southeast Asia will be worth US$1 trillion.
Between now and then, 60 per cent of the world’s economic growth will come from Asia. In an ideal world, e-commerce merchants looking for growth would invest right across Asia.
In just one market example, smartphone ownership is the norm. Consequently, with the uptake of e-wallets, bank-transfer apps and other local payment methods (LPMs) surging, the Indonesian payment market seems set to diversify rapidly.
To win in such a fast-evolving environment, merchants and payment service providers (PSPs) must work with a partner that understands local payment culture, preferences and e-commerce conditions. These preferences can be different across merchant industries, basket sizes, and consumer demographics.
And while we’re well into the pandemic, with new variants emerging, we are just at the beginning of a digital payments revolution.
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