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Despite recent road bumps in 2020, eCommerce in the Philippines is still going strong. Our updated article on the Philippines’ eCommerce drivers covered that this country’s eCommerce market for consumer goods value grew from US$ 3 billion in 2019 to US$ 4 billion in 2020, poised to grow to US$ 15 billion in 2025.1 Here’s a summary of the factors we covered in that article:
If you’re an eCommerce seller seeking cross-border retail opportunities in the Philippines, this is all obviously exciting news. But the question is: who exactly will you be selling to?
Research by We Are Social and Hootsuite reveals that 67 per cent (73.91 million) of the country’s total population of 107.3 million people are active Internet users. 38.88 million people in the Philippines have purchased a product or service online based on the same report.9*
*The data sources used by Digital 2021 Philippines changed their bases, which makes this data not comparable with previous reports.
Some key factors include:
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An eCommerce study by Visa found that Filipino consumers shopped online for the following reasons:15
With measures to control the spread of COVID-19 in the Philippines still ongoing as of the time of writing (August 2021),16 another strong reason for people in the Philippines to shop online is to stay safe from the pandemic.
Colliers’ research found that brick and mortar stores are facing reduced incomes while online shopping usage in the Philippines jumped. They also reported that 67 per cent of shoppers who previously shopped online plan on continuing even after the removal of quarantine measures.17 COVID-19’s impact on the economy is likely to increase Filipino shoppers’ price-sensitivity further as well.
This focus on pricing might make it difficult for you to compete with local, more affordable products, but if you can improve the efficiency and reduce the cost of your cross-border or international shipping, it may be possible to offer competitive deals on international products thanks to the savings generated.
Finally, a separate Nielsen report found that another reason eCommerce consumers in the Philippines shop online is to get access to products not found locally.18 For example, if you are selling beauty and personal care products, take note of the rising demand for Korean beauty products in the Philippines, with 71% of Filipino respondents to a Statista survey reporting that at least 25% of their cosmetic products used are South Korean brands.19 The main reasons they cited for the popularity of Korean cosmetics were that they were more effective and produced better results over competing products.20
iPrice reported that fashion was one of the most bought consumer goods categories online in the Philippines in 2020.21 Children’s and baby clothing along with men’s and women’s underwear still saw steady demand in 2020.22
In terms of consumer electronics, smartphones were increasingly seen as essentials during the pandemic,23 with some of the leading brands in 2021 being Realme, Vivo, and Oppo.24 The new requirement for distance learning pushed up demand for laptops so that children could continue their studies.25
Demand for skincare purchases was driven by the closure of brick and mortar stores where people purchased their premium health and beauty products among other factors.26 If you’d like to get more insights on this, check out our article on Philippines’ popular eCommerce product categories.
If you’d like to find out more about how we can solve your SEA e-commerce cross-border delivery needs, come and have a conversation with us!
As mentioned earlier, young Filipinos make up the majority of online shoppers in the Philippines. Research by DAN Philippines and eConsultancy, cited by the Philippine Star newspaper, shows that these consumers demand value for money and great shopping experiences.27
While Filipinos are price conscious it doesn’t mean they’re conservative spenders. During the lockdown period last year, Filipino shoppers increased their basket size by 57 per cent in the first half of 2020 compared to the previous year, the biggest of such growth in Southeast Asia.28
Back in 2017, Filipinos’ average basket value in online shopping in the Philippines was the second highest (US$56) in Southeast Asia.29 Sales and promotions are a particularly huge draw for Filipino online shoppers, with shopping festivals like Singles Day generating record profits for the two major marketplaces in the country, Lazada30 and Shopee.31
However, Filipinos also take their time when arriving at purchase decisions. Filipinos perform six to seven searches before arriving at a purchase decision, Marketing Interactive reports, citing data from Google and Kantar TNS.32 In fact, 90 per cent Internet users in the Philippines searched for a product or service online to buy. Most of these research activities take place on social media, where the average Filipino spends around four hours each day.
This has several implications. For one, this means Filipinos likely have a longer buyer’s journey. For the end of year holiday shopping season, consider marketing your products on social media as early as September—this is when most consumers in the Philippines are already thinking about Christmas, and with it, their shopping lists.33
For product categories like beauty, fashion, and personal care, Filipinos look to style mavens and social media influencers for cues on what products are effective, safe to use, and in style. Consider running an audit of social media influencers in the country to put yourself in the shoes of these consumers and understand why styles and products they are likely to purchase from you.
Another factor that influences the online shopping habits of Filipinos is the desire to pay in cash, which makes up 67 per cent of all transactions.34 You need to consider offering cash on delivery as an option if you want to reach out to this market. To do this, look for a logistics service provider who offers last mile delivery and cash on delivery services.
iPrice’s Map of eCommerce shows that the top online shopping sites in the country are dominated by major online marketplaces that are open to cross-border sellers.35 As of Q1 2021, these are Shopee, Lazada, Zalora, Ebay, and Beauty MNL, all of which manage transactions between shoppers and third-party sellers.
In fact, Shopee and Lazada are both in the top 5 Google shopping queries in 2020 according to We are Social and Hootsuite’s Digital 2021 Philippines. Back in 2018’s 11.11 sale, Lazada was also the most talked about eCommerce site on Philippine social media, accounting for 61.2 per cent of mentions vs. Shopee’s 35.4 per cent share.36
The sheer amount of chatter generated by these shopping festivals and other eCommerce shopping events on social media, particularly Facebook and Twitter, should encourage you to ride on these trending conversations by promoting your own discounted eCommerce offerings on social media.
The popularity of shopping festivals on both eCommerce platforms opens doors for different promotions you can try, from “buy one take one” offers to freebies and free shipping.
Looking for more insights like these on eCommerce in the Philippines? Find out more in our latest eCommerce Guide to the Philippines!
The pattern of price, convenience, and bargains is something that comes up in report after report on the habits and motivations of online shoppers in the Philippines. If you’re looking to capture a slice of the Philippine eCommerce market, consider the following strategies.
Breaking into a new market can be difficult. But with research, strategic marketing, and the right suppliers and shipping partners, you can make sure that you satisfy the needs and preferences of eCommerce consumers in the Philippines.
If you’d like to find out more about how we can solve your SEA eCommerce cross-border delivery needs, come and have a conversation with us!
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