Digital business and e-commerce trends are redefining the way organisations function. How can they capitalise their potential?
The global market is becoming smaller by the day, and IT professionals are the ones tasked with maintaining the networks, systems and infrastructure that connect countries together.
Commerce has evolved into e-commerce, and businesses that adopt these trends stand to have the best chance of capitalising on the connected nature of the modern retail industry. However, while there are range of potential benefits, there’s also a lot to learn.
Businesses that break out of their local or national regions thanks to e-commerce need to be prepared to manage all-new markets and the consumer and economic trends that define these. It’s also essential for these companies be aware of the countries with the most active e-commerce markets, with research discovering some of our closest neighbours could hold the key.
What are the largest e-commerce markets?
There are two considerations businesses need to make when assessing their potential expansion into international markets. Not only do they need to consider which are currently the largest, they should also be investigating the emerging markets that are likely to see substantial growth in the coming years.
According to ATKearney’s Global Retail E-commerce Index, the US is currently the largest market for e-commerce developments, unsurprising given the dominance of Amazon in this region and the rest of the world.
However, while the US is currently commanding the top spot in this index, the nation in second place is one of the biggest movers and shakers in the e-commerce industry, and could disrupt current trends.
While China is second according to these ranks at the moment, McKinsey & Company recently reported that it’s one of the fastest growing markets. The firm found that at the end of 2013, China’s e-commerce industry was worth just under $US300 billion, a figure that will more than double by 2018 if McKinsey & Company’s forecast is correct.
The range of large companies already capitalising on these trends within China is the catalyst for this growth, with three in particular – Alibaba, Baidu and Tencent – forming the backbone of the country’s digital economy.
ATKearney’s scale also revealed that Australia is equipped to capitalise on these growing trends, ranking the country tenth overall. This reveals that retailers don’t necessarily have to look overseas to profit from e-commerce initiatives, as Australia’s market is more than accommodating.
How can businesses succeed overseas?
Previously, businesses looking to expand into overseas markets relied purely on physical exports, and couldn’t back this up with online offerings as they simply didn’t exist. While the recent free-trade agreement with China has the potential to liven up the export industry, strong e-commerce offerings will be the best platform for success.
McKinsey & Company prepared a list of required features on order to succeed in these foreign markets, offering a particular focus on China.
One of the firm’s key points is that Australian businesses can’t guarantee success in the region by simply importing their domestic strategies over. Whether it means hiring new IT staff, adapting a social media strategy or partnering with a Chinese firm, McKinsey & Company urges expanding business to try something new.
Most importantly, businesses making the move need to be prepared to utilise the technology that consumers in the new market are used to. In China’s case, this means a focus on mobile technologies and social media, as the two go hand-in-hand for these shoppers.
The mobile-centric approach to e-commerce is essential for businesses looking to make a splash the competitive Chinese market. McKinsey & Company reported there are more people in China who use the internet on their mobile devices than on a PC.
This trend could soon become a reality throughout the rest of the Asia-Pacific region as cheaper smartphones put the power in the hands of the people.
Why is digital business so important?
One of the main reasons digital business initiatives are so important is because modern consumers rely on this technology. These people want to use what they’ve invested in and are always looking for the next killer app.
Technology research expert Gartner confirmed organisations that approach digital business are already well ahead of those that are still on the fence.
According to the firm, the number of business leaders embracing these initiatives is increasing. In its latest survey, Gartner found that almost a third (32 per cent) of leaders in larger organisations have a functioning digital business strategy. Last year, this number was only 22 per cent.
Vice President Jorge Lopez believes these strategies are the key to innovative practices within businesses, and will become increasingly important as more industries are disrupted.
The disruptive effects of digital business cannot be underestimated,” he explained.
“To date, a limited number of product categories – music, books, photographs and newspapers – have seen their business models upended.”
These growing trends will demand a lot from businesses, and it’s essential for them to secure the talent they need to respond to these challenges effectively.
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