Blog post by Hanne Melin: The Future of eCommerce

08.04.2016

The future of e-commerce could hold global economic opportunities accessible to more individuals, entrepreneurs and small businesses in more parts of the world. Let me explain.

Commerce over distance has until recently come with significant costs related to transportation, redtape, communication. These costs increase with distance, which has confined small firms to commerce within limited areas and made them dependent on local demand.

The online platform dramatically reduces the costs of serving customers over a large geographical area.This allows firms to extend their reach from a town to the world, creating new commerce patterns:  

  • Micro firms account for 92% of EU enterprise population, only nine percent of them leverage foreign demand. On eBay, 93% of Commercial Sellers (firms with more than USD 10,000 in annual sales on eBay), the majority of which are micro, serve international customers.

  • Increasing exports is often part of developing countries’ growth strategies. Still, they remain underrepresented in trade. On eBay, firms from emerging economies perform almost identical to those from advanced. For example: among Colombian and UK Commercial Sellers, 65% and 61% respectively reach 10 or more countries.

  • Entrepreneurial activity has for long been more prevalent in areas characterized by high economic growth and dense population. Our study of eBay Commercial Sellers across EU’s about 270 regions suggests that entrepreneurship now flourishes also outside of such areas.  This is good news for Finland in the current situation. 

Inclusive commerce

These more inclusive commerce patterns translate into growth performance in many ways stronger than the national economy overall. We studied 18 different markets spanning both emerging and advanced economies; in all of them, eBay Commercial Sellers showed annual growth rates exceeding the GDP growth of their home country for 2010 to 2014.

Evenly distribute future

The online platform model for commerce is making the business of running a small enterprise more sustainable in more places. This is commerce as an enabler of inclusive economic opportunities. To more evenly distribute this future, we now need to – amongst other things – expand access to the Internet, eliminate duties on cross-border returns, recognize postal systems as trade facilitators, develop cooperative customs risk assessment.

For more information, please go to: eBay Europe Study and Global Study

 

The Update Forum is held on April 27, 2016 in Helsinki, Finland.