Lanka’s e-commerce industry on the rise | Page 2 | Sunday Observer

Lanka’s e-commerce industry on the rise

9 August, 2020

The e-commerce industry in Sri Lanka recorded rapid development over the past year, with a large percentage of shoppers venturing to the digital platform.

An increase in confidence on  products and online payment gateways have supported the change of perception towards e-commerce.

Online marketplace, Daraz, collating data from their own platform, released an e-commerce index that indicates key demographic, consumer behaviour and purchasing trends of  online shopping in Sri Lanka. The numbers indicate a 1.5X YoY growth of active users with a 2.5X growth in the number of orders last year.

The Western Province owns the largest online order share with 50% while the Central and North Western Provinces follow with 10% and 9%. Colombo and Gampaha lead the district wise order share with 31% and 15%.

The concentration in these locations mirrors the population density of the country. However, there is an indication of expansion from key cities of Colombo, Gampaha and Kandy towards developing towns such as Kurunegala, Kalutara and Gampaha.

The shoppers fall into three broad categories with diverse shopping behaviour. The ‘young online shoppers’ within the age of 18 to 24 are recreational shoppers who enjoy shopping for the latest trends.

They are tech savvy, loyal to brands, and less price conscious. The ‘well informed shopper’ consists of the age category 25–30 years, whose decisions are affected by quality and reliability. Though brand loyalty is present, this category also looks for the best deals and flash sales, with a majority shopping for personal and home items.

Those within 31-35 years are the ‘settled adult shoppers’ who shop according to their needs and stay within their budget. They are quality conscious, less experimental and expect fast delivery.

The Daraz e-commerce index uses two metrics; the percentage share of total net merchandise value and the percentage share of orders.

Electronics and fashion related products are the most searched items online. Mobile phones, smart watches, power banks, bluetooth speakers and laptops and notebooks lead the category while handbags and shoes are the most searched for fashion items. Electronics, fashion, groceries, lifestyle along with mobiles and tablets are the most bought categories.

Online payment gateways through top local banks have increased and taken over the cash on delivery option drastically. Having no option than to resort to online shopping during the lockdown period, the public began to shift to the digital platform more than ever before. Purchases in the FMCG category doubled in March and are expected to grow from 20% to 70%.

The search patterns were highly concentrated on protective clothing and gear such as face masks, hand sanitisers, and medical surgical masks in March this year. The e-commerce index reflects novel trends in retail shopping and the behavioural changes of shoppers that will shape the course of retail trade in the country. It will help understand the market and establish standards that benefit the expansion of the online shopping industry.