The global leader in digital payment has unleashed the results from its Cross-Border Consumer Research for 2018. The said research was conducted globally, with 34,000 respondents, to get an insight about the consumer attitudes of in terms of online shopping and the evolution of online commerce. Among the respondents are 1,006 Filipinos age 18 and above who owns a mobile device with Internet access.
Online spending to rise
In line with 55 percent of Filipinos expecting to increase their online spend, the total online spend of Filipino shoppers is predicted to increase by 32 percent from an estimated PHP 92.5billion in 2017 to PHP 121.9 billion in 2018. Cross border, which refers to international trade, spend in the Philippines is also expected to grow by 32 percent in 2018 from an estimated PHP 41.5 billion spent in 2017.
The key motivating factor for the rise in online spending expectations is convenience (82 percent). The breadth of online platforms (52 percent), and expectations of a faster shipping process (45 percent) round up the top three reasons for Filipinos believing they will spend more online in 2018.
Growth on online spending
According to the report, over half of the Filipinos are looking to increase their online spending this year, presenting new opportunities for local merchants to expand sales globally. It is currently predicted to increase by 32 percent, amounting to PHP 121.9 billion. International trade, however, is expected to grow up to 47 percent from an estimated PHP 41.5 billion spent in 2017.
Cross-border purchases through smartphones
From the Asia Pacific countries that were surveyed, Philippines ranked third when it comes to the proportion of international purchases made via smartphones. With the rise of mobile users in the country, PayPal is seeing a developing trajectory for online shopping through tablets and phone since new mobile technologies are continuously emerging.
Garnering a total of 68 percent, clothing, footwear, and accessories has surfaced as the top choice of Filipinos for cross-border online purchase. The next most shopped categories amongst cross-border shoppers includes consumer electronics, as well as cosmetics and beauty products, with 57 and 56 percent respectively. The sophisticated survey also showed that Filipinos are turning their attention to buy basic necessities online. Household goods (26 percent); baby/children supplies (24 percent), and leisure, hobby & outdoor equipment (23 percent) are the top three groups for the nation’s online spending forecast.
The company also determined that the main three potential drivers for cross-border shopping are the following:
-direct conversion of costs in local currency
-proof of product authenticity, and
-cheapest total cost of a product including its shipping fee.
Value for money is a priority for shoppers
Despite the popularity of international online shopping among Filipino consumers, challenges to online shopping exist. Shipping costs are the top barrier preventing shoppers from buying cross-border more often, cited by 33 percent of Filipino cross-border shoppers interviewed.
Other key factors include customs duties or taxes (selected by 31 percent) and the difficult process for returning products (28 percent).
“2018 looks to be a year of growth and opportunities for savvy businesses that are equipped to take their cross-border sales online, on mobile and in-app. As leaders in digital payments, we are proud to enable merchants to take the best advantage of opportunities by connecting them with global consumers regardless of place or space. This in turn provides endless choices and possibilities for the mobile-savvy generation as they live their lives on the go. But we understand that while people love to shop, the hassle of online payments may deter them from doing so. PayPal takes care of that by making online payments more seamless, more convenient and secure for consumers to buy the things they need and love,” shared by Abhinav Kumar, head of Strategic Partnerships for PayPal in Southeast Asia.