the future of internet retailing in asia pacific
TRANSCRIPT
© Euromonitor International
1
THE FUTURE OF INTERNET RETAILING IN ASIA PACIFIC 2014 AND BEYOND
APRIL 2015
© Euromonitor International
2
$285 BILLION, 2014
30.2% GROWTH IN 2014
$72bn LARGEST RETAILER
© Euromonitor International
4
ASIA PACIFIC IN CONTEXT
ONLINE OPPORTUNITIES
THE ROAD AHEAD
© Euromonitor International
5
Asia Pacific: Biggest Retail Market Globally
ASIA PACIFIC IN CONTEXT
-
1,000
2,000
3,000
4,000
5,000
2014
Ret
ail
sa
les,
ex
VA
T,
US
$ b
n
Global Retail Sales
Asia Pacific Western Europe North America
Latin America Eastern Europe Middle East and Africa
Australasia
© Euromonitor International
6
… With Biggest Opportunities
ASIA PACIFIC IN CONTEXT
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
0
200
400
600
800
1,000
1,200
Ret
ail
sa
les,
ex
VA
T,
US
$ b
n
Forecast Retail Growth
2014 - 19 absolute value growth 2014 - 19 CAGR
© Euromonitor International
7
Internet Retailing - Fastest Growing Channel
ASIA PACIFIC IN CONTEXT
0%
10%
20%
30%
40%
0
100
200
300
400
% g
row
th,
fix
ed e
xch
ra
te
Ret
ail
sa
les,
ex
VA
T,
US
$ b
n
Asia Pacific Internet Retailing Sales and Growth
Internet sales Internet Retailing growth Retail growth
x4
… in every market.
© Euromonitor International
8
0
5
10
15
0
500
1000
1500
Ret
ail
sa
les,
ex
VA
T,
US
$ b
n
2009-14 2014-19 Growth
Internet Retailing – Biggest Opportunity & Challenge for Retailers
ASIA PACIFIC IN CONTEXT
© Euromonitor International
9
Consumer
Price
24/7
Product range
Product Information
International brands
Congestion
Retailer
Wider audience
Fewer stores
Consumer analytics
Tax/ Cost
International expansion
Internet Retailing Drivers
ASIA PACIFIC IN CONTEXT
© Euromonitor International
10
ASIA PACIFIC IN CONTEXT
ONLINE OPPORTUNITIES
THE ROAD AHEAD
© Euromonitor International
11
Asia Pacific Biggest Internet Retailing Market
ONLINE OPPORTUNITIES
0
50
100
150
200
250
300
2014
Ret
ail
sa
les,
ex
VA
T,
US
$ b
n
Global Internet Retailing Sales
Asia Pacific North America Western Europe
Eastern Europe Latin America Australasia
Middle East and Africa
© Euromonitor International
12
… Offering Biggest Opportunities
ONLINE OPPORTUNITIES
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
35.0%
0
50
100
150
200
250
300
Ret
ail
sa
les,
ex
VA
T,
US
$ b
n
Forecast Internet Retailing Growth
2014 - 19 absolute value growth 2014 - 19 CAGR
© Euromonitor International
13
58% 64% 75% 58%
24% 19% 18%
27% 11% 7%
0%
20%
40%
60%
80%
100%
2000 2009 2014 2019
Leading Internet Retailing Markets in Asia
China Japan South Korea
Taiwan India Hong Kong
Indonesia Others
2012: China overtakes Japan for
the first place
2015: India becomes 4th largest market in
Asia Pacific
2016: Indonesia overtakes Hong Kong
as the 6th biggest market
Region of Contrasts
ONLINE OPPORTUNITIES
© Euromonitor International
14
71
121
210
321
541
629
0 250 500 750
Asia Pacific
Thailand
Malaysia
China
Singapore
Hong Kong
Taiwan
Japan
South Korea
US$ per capita
Internet Retailing Per capita Sales, 2014
ONLINE OPPORTUNITIES
71
5
6
0 25 50 75
Asia Pacific
Pakistan
Uzbekistan
Azerbaijan
Philippines
Indonesia
Vietnam
India
Kazakhstan
US$ per capita
© Euromonitor International
15
0.0% 5.0% 10.0% 15.0%
Azerbaijan
Uzbekistan
Pakistan
Philippines
Kazakhstan
Vietnam
Indonesia
Malaysia
Thailand
India
Hong Kong
Singapore
Japan
Taiwan
China
South Korea
Internet Retailing Penetration
ONLINE OPPORTUNITIES
China Up Close:
• Underdeveloped
interior
• Price sensitivity
• Rapid online
access
• Strong internet
Players
© Euromonitor International
16
1,500 1,700 1,900 2,100 2,300 2,500 2,700
New Internet Users by Region 2009-2014
Users in 2009 Asia Pacific Middle East and Africa
Latin America Eastern Europe North America
Western Europe Australasia
Asia Leads in Internet Users
ONLINE OPPORTUNITIES
Asia Pacific:
55% of the increase in users – biggest increase globally
Only 37% of population has access to the internet
© Euromonitor International
17
050100
% of Population
Internet Users in 2014
ONLINE OPPORTUNITIES
0 50 100 150 200
India
Indonesia
Thailand
Philippines
Vietnam
China
Malaysia
Singapore
Hong Kong
Taiwan
South Korea
Japan
Million of people
637
© Euromonitor International
18
2014 Adoption in Asia
1.2 bn internet users
3.7 bn phone
subscriptions
25% mobile internet
subscription
0% 50% 100%
ThailandVietnamMalaysia
Hong KongPhilippines
SingaporeJapanChina
IndonesiaTaiwan
IndiaSouth Korea
Asia Pacific
Share of Smartphone Sales
2008 2013 2018
Smartphones to drive internet adoption
ONLINE OPPORTUNITIES
© Euromonitor International
19
Mobile Internet Retailing Penetration
ONLINE OPPORTUNITIES
22% of all sales
81% CAGR
US$ 61.5 bn
31% in South Korea ■Over 25% ■10 – 25% ■5 – 10% ■Up to 5%
© Euromonitor International
20
0% 10% 20% 30% 40% 50% 60% 70%
Latin America
Eastern Europe
Middle East and Africa
Western Europe
Asia Pacific
North America
Australasia
Share of Mobile Internet Sales
2014 2019
Mobile Internet Offers Opportunities
ONLINE OPPORTUNITIES
© Euromonitor International
21
Smartphones Closing the Gap
ONLINE OPPORTUNITIES
© Euromonitor International
22
1
10
100
2010 2011 2012 2013 2014
Ra
nk
Ov
er
all
Re
tail
ing
Wal-Mart (1)
Carrefour (2)
Seven & I (3)
Schwarz (4)
Tesco (5)
Amazon.com(6)Alibaba Group(14)
The Alibaba Effect
ONLINE OPPORTUNITIES
© Euromonitor International
23
0%
50%
100%
0
5
10
15
20
25
30
Ma
rk
et
Sh
ar
e %
Leading Internet Retailers, Asia Pacific, 2014
Marketplaces and Pure players dominate
ONLINE OPPORTUNITIES
© Euromonitor International
24
Apparel, 21%
Electronics , 15%
Media Products , 10%
Appliances , 9%
Food and Drink , 8% Beauty, 4%
Accessories and Eyewear ,
3%
Home and Garden, 3%
Healthcare , 1%
Traditional Toys, 0%
Other , 26%
Online Product Sales in Asia Pacific
ONLINE OPPORTUNITIES
© Euromonitor International
25
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
Internet Penetration by Industry, 2014
ONLINE OPPORTUNITIES
Consumer Electronics – 15%
Toys & Games - 16%
Consumer Appliances - 18%
Apparel - 12%
Beauty & Personal Care - 9%
Consumer Health – 5%
Less than 3% - Food and Drinks, Home and Garden, Personal Accessories
© Euromonitor International
26
ASIA PACIFIC IN CONTEXT
ONLINE OPPORTUNITIES
THE ROAD AHEAD
© Euromonitor International
27
0.0%
10.0%
20.0%
30.0%
40.0%
0
40
80
120
160
US
$ b
n,
ex
VA
T
Forecasted Internet Retail, 2019
2014-2019 Absolute US$ sales CAGR 2014-2019
367
Growth opportunities by market
THE ROAD AHEAD
© Euromonitor International
29
0 100,000 200,000 300,000
Jewellery and Watch Specialist…
Department Stores
Chemists/Pharmacies
Homewares and Home…
Apparel and Footwear Specialist…
Supermarkets
Internet Retailing
Additional value sales 2014-2019 , US$ billion, constant terms
Asia Pacific Channel Growth
Forecast Growth Means Online Sales Cannot Be Ignored
THE ROAD AHEAD
28%
© Euromonitor International
30
Usage Internet Access
User adoption
Payment methods
Deliveries
Channel integration
Multiple interaction
points
Data availability
Key Challenges
THE ROAD AHEAD
© Euromonitor International
31
THANK YOU FOR LISTENING
Premanjali Gupta (Naina)
Regional Communications (APAC)