Internet retailing is riding on an upward trend in APAC due to the technologically-savvy millennial population and growing consumerism of the middle class. The convenience provided by online platforms, product variety, and discounts offered act as compelling reasons for consumers to embrace the channel. As players in developed markets look to expand their online presence in rural areas, players in developing markets will focus on the basics- converting consumers to online buyers.
The parallel development of three factors including consumers’ increasing consciousness of eating healthy, fresh food, the growing familiarity and trust in e-commerce, as well as the convenience provided by online platforms have together contributed to the stellar food and drink internet retailing growth across Asia Pacific and prominently in China and South Korea. In the future, more innovations to ensure seamless logistical delivery to consumers in terms of product freshness are set to be spearheaded.
After an eventual saturation in cities, big players such as Alibaba and JD.com in major markets such as China are expected to penetrate into second- and third- tier cities to expand their coverage and encourage more rural consumers to make online purchases. This is based on the premise that internet penetration in these cities is first successful and leveraged by consumers.
Going forward, there may not be an option for retailers to either play in physical retail or online retail. The tradeoff may cease to exist because of the indispensable nature of both formats. In developed markets such as China, Japan and South Korea, players would look to enhance the offline-to-online experience while for up-and-coming markets such as India and Indonesia, retailers will extend their business online.
While the e-commerce revolution is still taking place, some markets will likely see m-commerce boosting online sales because the largely millennial population of Asia Pacific who are working will spend increasing time on mobile phones on the go. For example even a developing market such as Indonesia known for being a mobile-first nation is now shifting to a mobile-only nation because of millennials.
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