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2010 World Digital Economy - E-Commerce and M-Commerce Trends

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Last updated: 29 Oct 2010 Update History

Report Status: Archived

Report Pages: 118

Analyst: Kylie Wansink

Publication Overview

This annual report offers a wealth of information on the dynamic e-commerce and m-commerce sectors. The report includes analyses, statistics and trends. The report provides valuable insight into the key trends occurring worldwide and includes unique regional perspectives on the markets of North America, Latin America, Europe, Middle East, Africa and Asia Pacific.

Subjects covered include:

  • Key Elements of the Digital Economy;
  • Key Global E-commerce Trends;
  • Key Global M-commerce Trends;
  • Key Global Advertising Trends;
  • Regional insights for North America, Latin America, Europe, Middle East, Africa and Asia Pacific.

Researchers:- Kylie Wansink, Paul Budde, Lawrence Baker, Lucia Bibolini, Peter Evans, Lisa Hulme-Jones, Paul Kwon, Henry Lancaster, Peter Lange, Stephen McNamara
Current publication date:- October 2010 (3rd Edition)
Next publication date:- October 2011

Executive Summary

E-commerce and M-commerce enter new phase of development

It is no surprise that there is enormous interest in the unfolding developments occurring in the e-commerce and m-commerce sector. It is entering a new phase of development as the traditional online commerce sector merges with the newer web and mobile tools of social media, cloud computing, location based services etc. In addition, the infrastructure required to facilitate online and mobile commerce are becoming a reality as high-speed broadband and mobile technologies become more and more integrated into society.

Fifteen years ago we saw the launch of innovative online shopping services like eBay and Amazon and these, and other models, are now evolving and combining new elements of the online experience. In addition, the original e-retailers are facing competition as services based on a Person-to-Person (P2P) model become increasingly popular. P2P refers to a service which allows users to communicate directly with each other to exchange information, products, services, or alternatively make direct payments to each other (ie. PayPal). Crowd-sourcing is an extension of the P2P model and facilitates group communication in niche areas.

The P2P payment model offered by services such as PayPal is thriving thanks to demand from both consumers and vendors, and thanks to the methods of payments that are already based on tools developed for the web. The P2P model is also being used in social media as social networks and e-commerce begin to converge. Facebook in particular is entering the e-commerce space and it has a number of initiatives underway including its Payvment service, which allows sellers to create and operate a retail storefront on Facebook. Developments in this area are being referred to as “social shopping”.

Advertising remains a key source of revenue for those operating in both the e-commerce and online content sectors. In recent times there has been much discussion around targeted advertising utilising social media; online gaming; online video; online search and mobile advertising platforms. Traditional e-commerce vendors like Amazon now compete directly with other Internet players like Google and Facebook for the advertising dollar. However, given that spending on advertising using digital media channels makes up less than 15% of overall worldwide advertising spending; it has become clear that advertising cannot be relied upon as the only source of revenue.

Successful online business models are being quickly adapted or incorporated into mobile devices in order to maximise revenue opportunities. It is now impossible to discuss e-commerce developments without m-commerce, as these two sectors have become so closely linked. Unique services like FourSquare, which combine mobile location based services, social networking and e-commerce, are a growth area for the future.

FourSquare has already evolved from what was initially a clever way to inform others in real-time of a user’s movements, to a more sophisticated form of rewards program whereby loyal customers are offered discounts and special deals. However FourSquare must act quickly to retain its foothold in this new market as Internet media heavyweights like Facebook develop and launch services of their own.

While the e-commerce sector has become a very competitive sector indeed – other changes are also occurring in terms of how merchants operate and manage their websites. Some e-retailers are outsourcing areas such as security and payment processing, while others are beginning to make use of cloud computing services. Cloud computing allows e-retailers which don’t have the resources or capacity to manage their sites infrastructure to tap into a cloud based service.

The e-commerce and m-commerce services have become so dynamic that keeping abreast of the emerging trends has become a key priority for many enterprises and investors alike. This annual report provides valuable insights and analysis into the key trends taking place in the e-commerce and m-commerce sectors. It explores future directions with a focus on the use of social media, location based services and cloud computing for the digital economy. The report provides a unique perspective into how the digital economy is unfolding differently around the world by incorporating regional overviews written by BuddeComm’s senior analysts.

Market highlights:

  • Despite the economic downturn, online spending is proving quite resilient in most markets and in 2010 we are beginning to see some growth again as tentative confidence in the world economy returns.
  • Singapore, Hong Kong, India, Japan, South Korea and Australia are just some of the countries in Asia Pacific which have embraced online spending and there is room for much growth ahead. It has also become recognised that China offers enormous potential in the future..
  • Although the Internet’s overall share of total US retail sales remains relatively small in early 2010, at less than 4%, up from around 1.5% in 2003, nevertheless its share is expected to continue to grow steadily over the next 5 to 10 years, with sales forecast to reach over $240 billion by 2014.
  • Western Europe is one of the key regions for the growth in global e-commerce. E-commerce usage in Eastern Europe is growing strongly on the back of growing broadband penetration and Internet usage.
  • The opening of the telecom market and the blossoming of broadband has paved the way for a flourishing e-commerce sector in Argentina.
  • Mobile commerce is potentially important for a wide range of industries, including telecommunications, IT, finance, retail and the media, as well as for end-users. It will work best in those areas where it can emphasise the core virtue of mobile networks – convenience.
  • Jordan and Dubai have developed as the Middle East region’s major bases for web-based businesses and services but Saudi Arabia, home to around one in seven Arab Internet users, is the region’s most important market..
  • In the United Arab Emirates in 2010, Etisalat announced a partnership with Mobiqa which would allow consumers to purchase tickets via their mobile (m-ticketing).
  • M-payment services carry more than 12% of the country's GDP in Kenya.

Data in this report is the latest available at the time of preparation and may not be for the current year.

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