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Predict future growth of the EC business market from Japan and the world

  • The Japanese e-commerce market is expanding year by year!

  • The overseas e-commerce market is growing rapidly with double digits!

  • What status is Japan in the overseas e-commerce market?

  • Conclusion

 

The Japanese e-commerce market is expanding year by year!

“Market Survey on Electronic Commerce in FY2018” surveyed by METI (Ministry of Economy, Trade and Industry) has been released.

The METI survey results summarize the market size for the following three EC models.

    – BtoC EC market

    – CtoC EC market

    – BtoB EC market

 

First of all, let’s have a look at the B2C model survey results.

As shown above, the EC market size of the BtoC model in 2018 was 17,984.5 billion yen, 8.96% growth year over year.

The growth rate has been around 9% since 2016, so from this result it can be said that it is expanding year by year.

Among them, the largest market size and the highest growth rate of each field are as follows.

 

  • Product sales field
    • The largest market size: Clothing, apparel, etc. (1,772.8 billion yen, 7.74%)

    • The highest growth rate: Food, beverages and liquors (161.9 billion yen, 8.60%)

  • Service field

    • The largest market size: Travel services (37,186 billion yen, 10.27%)

    • The highest growth rate: Food and beverage service (637.5 billion yen, 41.61%)

  • Digital field

    • The largest market: Online games (1.4494 billion yen, 3.0%)

    • The highest growth rate: paid music distribution (64.5 billion yen, 12.51%)

 

What the one of the most surprising is the growth rate of food and beverage services exceeded 40%. Behind this, it can be said that the online reservation of the restaurant business and the use of smartphone apps are rapidly spreading.

 

 

Next is the Cto C EC market.

Since the CtoC model is a market that can be included a part of BtoC or BtoB model, let’s have a look at the results of the “Flima (Free market)” app survey.

The market size of the Flee Market app in 2018 was 639.2 billion yen, showing a rapid growth of 32.3% compared to the previous year.

Despite the first appearance of the Flee Market app in 2012, it has grown remarkably.

This seems to be closely related to the increasing use of smartphones and network lines (4G compatible). It is one of the notable markets.

 

 

Lastly, the BtoB EC market.

The EC market size of the B2B model in 2018 was 344,230 billion yen, with a year-on-year growth rate of 8.1%, which is also expanding.

In particular, the growth rate is high in the order of “Wholesale”, “Construction / Real Estate”, “Textiles / Daily Goods / Chemicals”, and “Industrial Equipment / Precision Equipment”.

 

In conclusion, the e-commerce market for all models in Japan is expanding year by year, and it can be said that it is a market that should keep watching.

 

 

 

The overseas e-commerce market is growing rapidly with double digits!

We got it that the Japanese EC market is expanding year by year by METI survey results.

So what about the overseas e-commerce market?

 

eMarketer has reported about e-commerce market included thier prediction from 2017 to 2023.

eMarketer is a market research firm that provides insights and trends about the digital marketing and mass media industries such as e-commerce.

 

 

As shown in the above figure, the estimate was $ 4.2064 trillion (USD) in 2020, and it is expected to expand to 2023.

* However, excluding travel and event tickets

 

Look at the growth rate.

Although the growth rate has decreased compared with 2017, it is estimated that it is about 20% at the moment and about 15% by 2023. It is such a high growth rate, right?

 

 

Let’s have a look the top 10 countries that are leading the overseas e-commerce market.

* This figure is the result of excluding travel and event tickets, including product sales and service.

 

 

As shown above, the market size of the e-commerce in China is three times that of the US, which is the second largest.

The market size of the US e-commerce is even large enough, so it can be said that China and the United States are leading the overseas e-commerce market.

 

In China, the year-on-year growth rate is 27.3%, and it is still growing rapidly.

 

Focusing on “rapid growth,” India is one of the countries that will keep an eye on it, with the year-on-year growth rate of 31.9%, the highest among the top 10.

 

In other countries, the growth rate exceeds that of India, so you should check it out at the same time.

 

 

The growth rate of Mexico was 35.0%, which was top 1.

 

I think there are not enough for infrastructure. However, Mexico was the best growth rate.

Behind this, because the FinTech business is expanding with the entry of Amazon and Mercado Libre. In addition, the Mexican government seems to be supporting the FinTech business.

 

 

 

 

What status is Japan in the overseas e-commerce market?

From the above, the keyword “Japan” is not shown in the global e-commerce market. So what position is Japan?

Japan ranks fourth in the global e-commerce market and is not a small market.

However, the year-over-year growth rate is 4.0%, which is the lowest score in the top ten.

 

You may be more pessimistic about this.

From a global perspective, the growth rate of the Japanese e-commerce market is slowing down compared to other countries.

* However, this is a guess based on the result of excluding travel and event tickets, including product sales and service.

Let’s focus on the cross-border EC market here.

The figure below shows the results of a survey conducted by the METI in Japan on the top two e-commerce markets in China, the United States and Japan.

 

 

The cross-border e-commerce market in Japan (China and the United States) is 276.5 billion yen, while the cross-border e-commerce market in China (Japan and the U.S.) is 3,262 billion yen, and the e-commerce market in the U.S. The size was 1,392.1 billion yen.

 

This difference is surprising, but there are other points to keep in mind. Look at the figure below.

 

The total value of China purchased from Japan’s cross-border EC was 1,534.5 billion yen, and the total value of the United States purchased from Japan’s cross-border EC was 823.8 billion yen

 

“The market size for purchasing Japanese products from overseas (China / USA) is significantly larger than the market size for purchasing foreign (China / US) products from Japan.”

 

I feel the potential of the cross-border EC market overseas in Japan can be high.

 

Also, the reasons for the low size of the e-commerce market in Japan’s cross-border (China / U.S.A.) Are as follows: “Even your own EC site is enough”, “Foreign language barrier”, “Return troublesome”, “Low creditworthiness of overseas EC sites” is mentioned.

 

 

 

Conclusion

The Japanese EC market and the overseas EC market are expanding year by year. I felt particularly attractive in the overseas cross-border e-commerce market.

 

In the future, I think the effectiveness is high because the “global” EC site attracts many users and high-quality Japanese products are evaluated.

However, please note that there are some requirements for launching an e-commerce site for overseas, more than for a domestic e-commerce site.

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