Why has e-commerce grown so much and what you should be doing about it


The Asian region has become a hot-bed for rapid e-commerce growth. E-commerce space in Asia could hit $1.3 trillion by 2021. According to some, the Southeast Asian region would grow at 32% CAGR, reaching about $88 billion by 2025, Indian shores have taken up e-commerce strongly. Here, the market is slated to reach $64 billion by 2020, $200 billion by 2026, and surpass the U.S market by 2034.


So, what’s driving this growth?


High internet penetration and tech adoption


Internet penetration is growing at a rate of about 24% across urban and rural areas. What this means is that every year there is a new slice of customers coming in. There new acquisition and expansion for grabs. And the way to get these customers, who are more open to experimenting with different brands, is to give them a delivery experience they can be in awe of. It can be done, only, by using the proper technology to plan, move, and track orders.


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In general, people are now more tech-savvy and are inclined to use it to make their everyday lives simpler. The same people are more inclined to give a premium for such convenience and quality. What’s more? When the people who desire convenience watch companies like Amazon, Apple, and Google go the extra mile to make it happen, they become loyal to these companies. Investing in technology, be it for logistics movement or customer solutions, is a surefire way to grow market share.


High demand with dwindling stationary retail support


We just looked into some looming and some latent need for higher convenience. This is for a population which has more disposable income than their preceding generations and aren’t as utilitarian as before. A Nielsen report suggests a high percentage of customers in Asia would readily pay a premium for an innovative product or service, including and not restricted to speedy package deliveries. The buying experience has evolved, and people are looking beyond the limited assortment as stationary retail outlets. They want to explore more and make decisions when they deem it right.


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As e-commerce companies have reduced warehousing or stocking costs, they actively try to reduce logistics costs to offer competitive pricing for each of their published products.


This, however, doesn’t mean that stationary retail is becoming extent. It’s just that the way we see retail has changed. Now retail is an omnichannel model of online and in-store shopping. Brick and mortar has been replaced by click and mortar.


Logistics tech to create the perfect delivery experience


The last piece of the puzzle and the most important one for e-commerce companies to sustain their value proposition for customers is efficient logistics optimization. Top GDP Asian countries, including some of the high-on-innovation Southeast Asian countries, face complicated infrastructural issues. Take Indonesia for instance, world’s largest Island country. It has around 13,000 Islands connected through intricate distribution networks. The problems which need to be surpassed here to make consistently on-time deliveries are unique.


The growth in e-commerce and retail (omnichannel) have outpaced infrastructure development. Companies must ensure that underdeveloped or unplanned infrastructure (roads and connectivity) leading to pockets of traffic and detention, don’t become bottlenecks for on-time deliveries.


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Technology, primarily cloud-based, in logistics, has helped companies with making better delivery schedules, planning traffic-light and shorter routes to reach destinations, handling random ad-hoc pickups and drops within routes, and more. The direct benefits are faster deliveries with clear communication between all stakeholders (managers, delivery associates, and customers) about where exactly the package has reached. When customers have this information, they are more tolerant of any unavoidable delay.


Think about it, previously the customer didn’t know when their package would come in, even when the day was specified. It could be in the morning, afternoon, or evening. Now, the customer would not just know the time when the delivery would reach them but would also have the timely updated estimated time of arrivals for the same. Even if the customer isn’t available at that time, they can instantly set up a change of delivery address or just ask it to be left with another receiver.


These things require on-ground tracking and reporting. The manager can just update the delivery route of the associate to incorporate the new information. Robust planning engines running alongside (that’s where cloud-based tech has an advantage) safely reroute the trip with minimal-to-no effect on ETAs of other orders. Even when these ETAs are recalculated for the sake of precision, the end-receiver is notified immediately.


This gives way to create the perfect delivery experience for customers. We know that acquiring a new customer is much more difficult than retaining one. And with the e-commerce market in a deep flux with consolidation and new entrants, customers have a lot more choices for shopping. It would only become more difficult for companies to acquire new customers in the future. This is the perfect time for them to create a following among their customers.


Give them the best delivery experience and they will stay with you. And the tech is there to make this happen if you aren’t using it, your competition is.


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