Global E-Commerce is ready to rock. With the sales prediction of $963 billion by 2013, E-Commerce has become one of the most promising business models for marketers. As per the latest report by Goldman Sachs, the global E-Commerce market will witness the growth rate of 19.4% by end of 2013. Only in the U.S., Goldman is predicting 12.4% growth rate during next three years to reach $235.3 billion in online retail sales. However, Europe, apparently, is the most promising market with the maximum contribution of $283 billion by 2013.
“E-commerce is benefiting from several positive trends, including the continued roll-out of broadband, increasing user comfort shopping online and the decline of certain brick-and-mortar retailers,” Imran Khan, a managing director of Goldman Sachs, writes in the 416-page report “Nothing But Net: 2011 Internet Investment Guide.”
The major impact on E-Commerce will be recorded due to explosive growth of Internet accessibility across the globe and revolution in mobile handset market. People are fascinated towards smartphones and social media. The price and technology war in mobile domain has made smartphones much more capable and affordable for people. Similarly, the extensive and intelligent interconnectivity among people through social media & social networking is also helping as an effective marketing channel for E-Commerce business.
“We think that the proliferation of mobile devices and mobile apps could have a profoundly negative impact on the business model of traditional retailers,” Khan writes. “Historically, getting a customer in the store was half the battle for a retailer. Mobile apps turn this dynamic on its head by giving more power to the shopper, even in-store.”
In the U.S. alone, there remains much room for e-commerce growth, Khan argues. He notes that the web’s share of all retail sales grew only from 2.9% to 3.9% from 2006 to 2009, while the online share of advertising spend, during that span, increased from 6.4% to 13.7%. “While adoption of online shopping has moved at a slower pace,” Khan writes, “the penetration could accelerate as consumer habits change.” He projects the number of online shoppers in the U.S. will grow from 170 million in 2010 to 189 million in 2013, a 3.6% compound annual growth rate.
As per Mr. Khan, various geographies have own set of targets and goals to accomplish in E-Commerce market. Digging further, he predicts the maximum contribution to come from Europe with $283 billion by 2013 moving from $195.2 billion in 2010. U.S. will hold another substantial cut in the growth of E-Commerce with $235.3 billion by 2013 from $165.8 billion in 2010. Asia which is shares $155.7 billion in 2010 will scale up to $323.1 billion by 2013. Left over $121.7 billion will be contributed by rest of the world in E-commerce sales.