2019 J.P. Morgan Global Payment Trends

Expanding your e-commerce business? Navigate new global markets with our local payments insights

INTERNATIONAL OVERVIEW


What time of day does an online shopper in Singapore typically convert their basket into a sale, and what is the favourite way to pay in Mexico? To succeed in e-commerce, merchants must stay abreast of trends, technological advances, regulatory changes and even local traditions. To help our clients locate, attract and keep their customers, we have tracked and assessed e-commerce developments in 34 mature and emerging markets around the globe.

China and India win out as lands of opportunity

Two countries stand out as the primary candidates for e-commerce merchants’ attention. China is responsible for more than half of all e-commerce in the Asia-Pacific region,1 and this figure is expected to rise to more than 60% by 2021.2 Further analysis revealed an even more important future indicator of growth. China’s internet penetration presently stands at just 54.6% – suggesting an untapped market of hundreds of millions of future shoppers yet to gain online access.3

Our second key market is India. With a population of circa 1.4 billion,4 India’s business-to-consumer e-commerce sector is set to expand at a compound annual growth rate of 26.5% to 2021,5 the second highest forecast out of all the countries* included in our report series. The Indian online shopper is typically young, with more than half of the population below the age of 25 and crucially, they are looking outwards for their shopping requirements.6 Cross-border spending accounts for seven out of ten of all Indian e-commerce sales,7 with Indian consumers desiring high quality foreign electronics and lifestyle products.8

The state’s demonetization of the Rs500 (US$7.25) and Rs1000 (US$14.50) bank notes is also helping drive digital sales. India is gradually moving away from cash payments and migrating to card and e-wallet payment options instead.9

From mid-week shopping to convenience stores: country-by-country quirks

International merchants can gain ground in new markets by anticipating and meeting local demands. For example, in Japan, international merchants should adapt to domestic trends in e-commerce layout and design. Shoppers prefer websites which are hyper-dense in images and text, shunning the white space seen in more Western websites.10 In Mexico, there is a culture of ordering products via mobile and then paying for them in cash at convenience stores.11 In Singapore, payments peak in the evening, at around 10pm,12 with Wednesday the most popular day to shop.13

Alternative payment methods are catalysing e-commerce growth in all markets, but our analysis revealed large variances in uptake and certain preferences among individual nations. In New Zealand, for example, ‘buy now, pay later’ services are growing online.14 There is also an opportunity in New Zealand for international merchants to grab market share, as overseas e-commerce is growing faster there than domestic e-commerce. Off-shore transactions were up by 37% and spend increased by 23%, compared to the same period the previous year.15

 

Apps are essential to gaining market share

Wherever you’re shopping from, one thing is clear: smartphones are a primary catalyst for e-commerce growth. Once again, Chinese shoppers are charging ahead. Almost three out of every four e-commerce transactions are now carried out on a mobile device, generating $873.2 billion in sales last year.16 This is even more surprising when considering China’s relatively low smartphone penetration, with just under half the population yet to buy a smartphone.17

In India, app store downloads grew by 165% between 2016 and 2018.18 In Hong Kong, a lack of app investment by domestic merchants could represent a chance for international sellers to make their mark.19 Apps are under-utilized featuring in only 14% of completed mobile commerce transactions – in contrast, in mainland China, the rate is 67%.20,21 Mastering app offerings to provide a seamless mobile shopping experience is therefore essential.

 

Global Payments Trends Reports

International e-commerce success can hinge upon understanding the needs, nuances and growth patterns of individual nations. J.P. Morgan’s Global Payments Trends Reports aims to offer merchants the knowledge they need for global success through in-depth, country-by-country analysis.

1.RakutenMarketing.com, August 2018. ‘The State of E-Commerce: Asia Pacific.’ Accessed February 2019
2.RakutenMarketing.com, August 2018. ‘The State of E-Commerce: Asia Pacific.’ Accessed February 2019.  
3.J.P. Morgan Global Payments Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company via Internet Live Stats (2015 & 2016) and Internet World Stats (2017).
4.J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company via World Bank, 2017.
5.J.P. Morgan Global Payments Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company, 2018.
6.J.P. Morgan Global Payments Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company via CIA World Factbook.
7.J.P. Morgan Global Payments Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company via E-commerce Foundation.
8.Export.gov, October 2018. ‘India – e-commerce.’ Accessed February 2019.
9.TheHinduBusinessLine.com, January 2018. ‘E-commerce players stop cash-on-delivery payment option temporarily.’ Accessed February 2019.
10.InfoCubic.com, 2017. ‘E-Commerce in Japan.’ Accessed March 2019.
11.Onlinepaymentacceptance.worldline.com, 2019. ‘What you should know about e-commerce in Latin America.’ Accessed February 2019.
12.iPrice.sg, 2017. ‘State of e-commerce in Southeast Asia 2017.’ Accessed January 2019.
13.iPrice.sg, 2017. ‘State of e-commerce in Southeast Asia 2017.’ Accessed January 2019.
14.NZPost.co.nz, 2018. ‘2018 New Zealand e-commerce Review.’ Accessed January 2019.
15.J.P. Morgan Global Payments Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company via New Zealand Post Limited E-commerce Report, 2018.
16.J.P. Morgan Global Payments Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company, 2018.
17.J.P. Morgan Global Payments Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company via Statista, 2018.
18.AppAnnie.com, 2019. ‘The State of Mobile 2019.’ Accessed February 2019.
19.RetailNews.asia, May 2018. ‘Google explains Hong Kong’s E-commerce Challenges.’ Accessed February 2019.
20.J.P. Morgan Global Payments Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company via Nielsen, ‘Hong Kong Consumer Embraces E-commerce Development’, 2018.
21.J.P. Morgan Global Payments Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company via TMOGroup.asia, 2019. ‘Asia China Mobile Commerce.’
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