The digital economy grows and grows: Why you should invest in modern E-Commerce now
If you think E-Commerce has experienced a surge in popularity and revenue in recent years, you haven’t seen anything yet. Renowned German market research company Statista recently released their Digital Economy Compass 2018, an exhaustive resource of statistics on developments in the digital world. It also includes Statista’s Digital Market Outlook, which offers great insights on the future of E-Commerce.
$2.5 trillion in revenue by 2022
Statista’s predictions are remarkable, especially when it comes to the sheer scope of E-Commerce. For 2018, the company expects global revenue for the sector to reach almost $1.73 trillion, far exceeding 2017’s $1.51 trillion. And we can expect this rapid growth to continue over the next few years. For 2022, Statista expects global revenue in excess of $2.5 trillion, a whopping 44-percent jump from this year’s estimate. Fashion will be one of the greatest growth drivers in that period, expected to grow in revenue by 48 percent.
Unsurprisingly, fashion and consumer electronics were the biggest categories in E-Commerce in 2017, which is not likely to change anytime soon. Clothing accounted for $275.4 billion and consumer electronics for $264.3 billion of 2017’s total E-Commerce revenue of $1.51 trillion.
For consumer electronics, online sales made up 54 percent of the segment’s total sales in the US. By 2021, Statista expects that ratio to be 74 percent. Fashion is expected to remain much more rooted in traditional retail, with the report expecting the share of online sales in 2021 to be 24 percent in the US. However, the much larger overall revenue of global apparel sales will keep the segment at the top of the E-Commerce food chain.
China outpaces everyone
China is much more E-Commerce-oriented than the US, however. While online sales made up only 18 percent of apparel sales in the US in 2017, that percentage was an incredible 37 in China. The Chinese market was already the largest E-Commerce market by far before last year, but it grew again – by a massive 24 percent. It reached $496.8 billion in revenue, accounting for almost one third of global E-Commerce revenue. $25.3 billion in gross merchandise value was reached in Alibaba’s Singles Day promotion alone, dwarfing 2017’s US Thanksgiving weekend sales of $16.9 billion.
As overall E-Commerce revenue grows, more and more online sales transactions take place on a mobile device. In the US, four major product categories – Toys and Hobbies; Video Games, Consoles, and Accessories; Music, Movies, and Videos; and Jewelry and Watches – already saw more than 50 percent of revenue spent from mobile devices in 2017’s Q3.
TV ads eat digital advertising’s dust
Following in the wake of E-Commerce’s growth spurt, digital advertising is also expected to see a major increase in revenue. Statista expects global digital advertising revenue to hit $399.6 billion by 2022, a 42-percent jump from this year’s estimation. Over the last two years, digital advertising spending even outpaced TV advertising spending globally, with Statista and Magna Global expecting digital ads to be responsible for almost double the amount of TV ad spending.
What all these numbers show is even after years of steady growth, the sky remains the limit for E-Commerce and the digital market. We can expect growth rates to remain high, meaning that it’s a perfect time to invest in a state-of-the-art E-Commerce site for your business. As the report shows, state of the art also means mobile-friendly. With the reach of mobile devices growing every day, the percentage of transactions made on mobile will only keep growing. Niteco can help you to build an optimized E-Commerce website based on Episerver or Sitecore, tailored to your business.
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