The Online Shopping Revolution is Here to Stay
In the past, Filipinos would only occasionally shop on the Internet, and hardly ever for everyday essentials. But now, it's literally the first place we go to buy anything. Our online shopping habits have changed so drastically, especially in the past year, so it's worth asking: has the future of commerce finally arrived in the Philippines, and is it here to stay?
Prashant Kala is keenly aware of shifts in the Philippines' adoption of e-commerce, and how it affects the everyday lives of Filipinos. As the Country Manager of ShopBack Philippines, an online pre-shopping portal, he likes to keep a finger on the industry's pulse at all times.
“Though the pandemic is inarguably one of the key reasons for the rapid acceleration of e-commerce, it is far from the only reason," says Kala. "Previous year reports were already bullish about the rise of e-commerce, and identified growing internet penetration in the Philippines as well as across the regions.”
We spoke to Kala to break down the online shopping revolution, and to examine the reasons why it's ultimately here to stay.
Demands are being met head-on, with space for more choices
“The long-term outlook of the Internet economy in Southeast Asia is more robust than ever," says Kala. He credits this to at least three main factors: "a growing online population, lasting adoption of digital services, and increased usage and trust in digital services."
This creates a self-perpetuating cycle: more and more consumers are shopping online, so more and more businesses are hawking their goods on the Internet. Things were already headed in this direction, but the pandemic gave it a push, and now, e-commerce is accelerating.
Kala understands perfectly the scale and pace of this acceleration, which started well before the pandemic. “If you take a look at last year's Google, Temasek, Bain & Company e-Conomy SEA 2019 Report, the Philippines was on track to become a $25B Internet economy by 2025, so the country was already warming up to the online shopping phenomenon," he says.
More businesses finally understand: It's time to go online
Now that we're all staying home, it's clearer than ever that the Internet is the most important touch point through which businesses must reach customers. And so not only are businesses making their services available online—they're taking their entire operations, including and especially their marketing, to the Internet.
It's evident in the number of new merchants with which ShopBack partnered this year: 200. Now, its users can enjoy cashback from a total of over 500 merchant partners in categories like fitness equipment, home and living essentials, electronics, online groceries, health and beauty, and banking.
“On our end, we can see that our merchant partners have started investing more heavily in digital marketing and ad spend since the last quarter of 2019," says Kala, "and this trend continues to grow rapidly.” It's not just the point of sale that has moved online, but the entire marketplace.
The better deals are found online
One advantage that online platforms have over brick-and-mortar shops? How easily and frequently they can hold of sales and promos. Kala says, “consumers in the Philippines like to do their research and hunt for the best deals to get the best bang for their buck.” With the right strategy and some vigilance, shoppers can easily snap up discounts and freebies that they wouldn't normally be able to get.
That's precisely where ShopBack, an online pre-shopping portal that provides cashback deals, has found success. “ShopBack helps its users stack their savings," says Kala, simplifying the unique selling proposition. "For example, ShopBack users can stack voucher codes and credit card deals on top of getting cashback on their online purchases.“ It's the ultimate platform for smart online shoppers.
By using the app as a pre-shopping start point, customers can get the most of their online hauls. ShopBack partners with merchants to offer enticing cashback promos that its users can get whenever they shop through the platform. The cashback can then be withdrawn or transferred by the users via PayPal, GCash, or directly to registered bank accounts. In this way, ShopBack rewards shoppers with real cash, while also encouraging them to shop smarter on the Internet.
Platforms like ShopBack demonstrate the breadth of possibilities in the online marketplace, and are a testament to the opportunities for growth. The only thing holding the industry back? According to Kala, it's the logistics sector and the use of online payments. But improvements in these areas have accelerated over the past year, so it shouldn't be long before e-commerce is set in stone as a primary means of doing business in the Philippines.