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Three Key Takeaways From Emerging Market E-Commerce Trends

As e-commerce industry growth has decelerated in the United States and Western Europe, emerging markets in Asia, Latin America, the Middle East and Africa are hitting their growth strides. For example, while America and Western Europe saw 14.5% and 10.2% e-commerce sales growth respectively in 2019, the regions of Latin America and the Middle East and Africa both saw a steady 21.3% increase in sales. And according to research by Credit Suisse, the share of online sales in India, Indonesia, Turkey, China, South Africa, Saudi Arabia, Mexico, Brazil, and Russia is set to outgrow that of developed economies.

Written by Sergio Granada

Online retail giants as well as small and medium-sized businesses are eyeing cross-border e-commerce opportunities in emerging markets, however, it is not as simple as copy-pasting strategies that have been successful for you in your home country. E-retailers must research markets they wish to enter and adapt their operations accordingly.

With that in mind, here are three key takeaways from emerging market e-commerce trends.

Fast, Mobile-First Marketing

Mobile marketing — reaching an audience on smartphones or similar devices through various channels like social media, SMS, email or mobile applications — plays an outsize role in many emerging markets, compared to developed economies. A dearth of access to fixed broadband in developing countries, coupled with an influx of cheaper smartphones to the market in the latter half of the past decade, have led to wider mobile internet usage in emerging markets.

While digital ad-spend only dethroned television advertising in the U.S. last year, in emerging markets like China, digital has held more importance for a while now, with companies in the country spending up to $80 billion in online ads.

This digital-first mindset has resulted in some creative mobile marketing campaigns.

For example, Chinese liquor distiller Xi Jiu collaborated with Chinese social media giant Tencent to rapidly develop an entire marketing campaign in a matter of days. It was made possible because instead of allocating ad-spend to various channels, the distiller focused on a single news app, where it ran a series of cooking videos which prominently featured its liquor. The videos ended up being watched by more than a million people per day.

The mobile-first conception and the rapid time frame of the campaign gave Xi Jiu the freedom to try an out-of-the-box approach.

Focus on Engagement Instead of Conversion

Marketers in developed economies are still laser focused on conversion, and they rely heavily on strong branding for customer retention. But this approach doesn’t always bring the expected results in emerging markets, due to the fierce competition there.

Mobile-first means that a competitor’s app or website is always just a click away, which is why many businesses there have moved their focus onto enhanced engagement.

For example, the Indian food delivery app Zomato created a series of food videos that can only be watched within its app. The series features famous chefs and other celebrities, keeping customers engaged with the brand long after their purchase.

With fierce competition entering emerging markets, brands must build strong relationships with their audience and keep them engaged in order to see success.

Court Prospective Buyers With In-Person Sales Teams

In some emerging markets such as Nigeria, gaining customers’ trust is a crucial hallmark for e-commerce businesses looking to start up.

In many countries the pervasiveness of scams and fraud in the early days of the internet has contributed to trust barriers e-commerce pros must overcome today. Another obstacle is that shopping online is still considered a relative novelty in some smaller markets.

Nigerian e-commerce startup Jumia, often considered Africa’s Amazon clone, came up with a unique and creative way to boost users’ trust in the shopping site.

The company deployed sales staff in larger cities, where they hold shopping events in public spaces, such as malls, schools, and churches. They answered people’s questions about online shopping in person and taught novices how to do their first online order.

For some emerging markets distrustful of online shopping, grassroots education and face-to-face relationship building are valuable tools to move the online economy forward.

E-commerce companies interested in cross-border sales into emerging markets would be wise to avoid viewing these countries only through the lens of their massive sales potential and expecting the same results by simply transplanting marketing strategies from their more developed home countries.

Rather, each market’s unique e-commerce environment opens doors for many novel strategies to be discovered, and remembering trends such as mobile-first marketing, valuing engagement over conversions, and developing trust among potential online shoppers, will give e-commerce pros a leg up as they enter new emerging markets.