eCommerce continues to thrive in the Philippines with six out of 10 Filipinos buying products and services online – an increase from only 46 percent in 2014 – with almost 60 percent of those below the age of 35 having shopped online using their mobile devices, according to recent Visa research.1
Visa Consumer Payments Attitude Study 2015 identified trends in payments behavior among consumers in six Southeast Asian markets2 including the Philippines.
Online shopping has transformed the ways Filipinos pay and get paid. The study showed that there are more active online shoppers nowadays compared to a year ago. The increasing engagement in online shopping, coupled with payment technologies available in the market, ensure robust growth and steady development of local eCommerce businesses.
The Philippines has an internet penetration rate of 39 percent;3 and eCommerce engagement is on the rise compared to countries with similar internet penetration. And despite the low proportion of active cardholders who shop online, a surge in transactions made through smartphones indicates consumers are going mobile first.
“eCommerce is becoming the ‘new normal’ in Southeast Asia, as consumers in the region take to online shopping because of the variety of goods and services available, competitive pricing and improved delivery options make the whole process much easier. Mobile devices such as smartphones have also brought online shopping to the palm of our hands,” said Stuart Tomlinson, Visa Country Manager for the Philippines and Guam.
Filipinos’ top reasons for doing their shopping online are convenience (52 percent), door-to-door delivery (30 percent), affordability (10 percent), and accessibility (8 percent).
Products and services that were predominantly bought online include software, apps and app-related content (68 percent), travel services (67 percent), events and concerts (55 percent), and digital content like games, music, and videos (53 percent). Other products and services that are increasingly being bought online are financial services (41 percent), food delivery (28 percent), and movie tickets (27 percent).
The percentage of respondents who use desktop computers and laptops (65 percent) as their primary means for online shopping is seen to plateau in 2016. Mobile devices such as tablets and particularly smartphones have seen usage increase (35 percent). Six out of ten Generation Y, those between 18 to 35 years of age, use mobile devices to shop the most (59 percent).
Strong intention to shop online using smartphones is also set to rise. More Filipinos expressed interest in mCommerce, using of smartphones in online shopping, from 19 percent in 2015 to 22 percent in 2016.
The top five categories for mobile purchases are ground transportation (73 percent), software, apps and app-related services (44 percent), digital content (44 percent), groceries (38 percent), and event and concerts (33 percent).
Good user experience and security are vital to successful eCommerce
Strong user experience remains vital. Two in five online (43 percent) shoppers clicked “buy” on computer or mobile devices because filling in information, such as billing and shipping details, during check out was a breeze.1
The outlook is optimistic for retailers: Respondents said they are more likely to shop if the retailer has a mobile optimized site (68 percent), and eight out of ten (84 percent) said they would download and use their favorite physical store’s mobile app if there is one.
The growing preference for mobile devices in online shopping is not only prevalent in the Philippines. A separate Visa study2 in 2015 revealed that consumers in 133Asia Pacific markets reported an average 22 percent increase from 2014 in shopping using mobile devices (mobile phones and tablets) over desktop computers.
“Though eCommerce in the Philippines is still in its nascent stage, it is growing rapidly. Categories such as groceries, food delivery and movie and concert tickets will become key growth drivers as they have low online share but high frequency of purchase. The high proportion of transactions made via smartphones also presents a strong opportunity for growth,” said Mr. Tomlinson.
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