How Is The Philippines E-Commerce Logistics Market Positioned?
The Philippines offers tremendous potential for e-commerce and omnichannel merchants, boasting one of the fastest-growing consumer markets in all of Asia and one of the world’s highest internet usage rates. According to an analysis, the combination of rapid urbanization and an emerging market of young shoppers (the country’s average age is 25.7 years) points to long-term economic growth and increased consumption. The Philippines’ shift towards e-commerce is boosted by certain factors including the growing middle class, growing government support, and convenience of a digitalized shopping experience. The Philippines also has the second-largest average online shopping basket size in Southeast Asia, which only goes to show how eager local consumers are to find and buy products online.
Moreover, the opportunity here for online sellers is quite clear: they can stand out in this market by offering products Filipino consumers don’t have access to locally. One of the reasons behind the relatively slow uptake of e-commerce in the country in the past few years is the continued dominance of cash-based transactions. According to the Philippines’ central bank, cash accounted for 99% of all local transactions as of January 2018. In addition, with the Philippines being an archipelago of more than 7,600 islands, logistics naturally presents a challenge you will have to prepare for when serving customers in this country. Consumers living in the sprawling capital of Metro Manila enjoy access to huge shopping malls, flagship brick-and-mortar stores, and even quick delivery from large marketplaces like Lazada and Shopee. Moreover, the Philippines has one of the slowest and most expensive internet connections in Southeast Asia. 87% of Filipino merchants sell products on social media. Facebook also drives traffic and engagement on Lazada, Shopee, and Zalora.
Philippines E-Commerce Logistics Market Segmentation, 2020
Philippines E-commerce logistics market has been observed in its early growth stages of development, thus growing year on year majorly due to rising E-retailing coupled with an increase in the number of online orders. The average logistics order cost in the Philippines was evaluated at PHP ~ per order in 2019 which further declined to PHP ~ in the year 2020.
The market has highly dominated by the 3PL players with a massive share of ~% in terms of annual shipments delivered during the year 2020. Marketplaces like Lazada and Shopee which have their in-house logistics arm are also dependent on 3PL partners to deliver their orders.
By Domestic and International Shipments
Most of the shipments ordered online in the Philippines are for domestic delivery. Domestic players through effective collaborations with global companies are enhancing their reach to the remote areas of the country. Most of the orders placed online are for intercity deliveries to the Metro Manila region.
Ground shipments dominate the overall revenue as last-mile; deliveries are not possible by air express. Moreover, ground express plays a significant role in first mile, mid mile, and last-mile deliveries.
By Delivery Period
1-3 day delivery has dominated the market in terms of the number of orders owing to the increasing focus of the companies on providing better services coupled with increasing customer needs for better service. Growing expectations of consumers towards fast shipping from e-retailers along with the delivery of products in the case of a special event, such as during festivals will lead to rising of same-day delivery options in the Philippines. Customers are even willing to pay the extra price for sooner deliveries.
By Type of Products
Consumer electronics have dominated the online retail sector in the Philippines in 2020. Gadgets & Electronics platforms such as Argomall have seen a huge rise in the business in recent years. Fashion & Accessories is another huge market in the Philippines. Fashion-related keywords like “Shoes, Nike, Adidas, and Dress” are among the top 10 shopping queries in 2020. Beauty and personal care is the third leading e-commerce category in the Philippines.
By Payment Mode
One of the reasons behind the relatively slow uptake of e-commerce in the country in the past few years is the continued dominance of cash-based transactions. Over 80% of online retail players in the Philippines offer COD or payment centers (like paying at a 7/11) as a payment option. Credit cards, Paypal, and GCash as a payment mode is also preferred by few consumers shopping online.
Key Segments Covered: –
By Type of Shipments
By Area of Delivery
By Delivery Period
Same Day Delivery
1-2 Day Delivery
3-4 Day Delivery
More than 4 Day Delivery
By Type of Products
Consumer Electronics & Media
Fashion & Accessories
Foods & Personal Care
Home Care & Furniture
Toys & Baby Products
Others (Video Games, Digital Music, Pet Care, Home Gardening, etc.)
By Payment Mode
Cash on Delivery
Others (Debit Cards, Paypal, GPay, SMART Money, etc.)
Captive and 3PL E-Commerce Warehousing
Warehousing Concentration in Philippines
E-Commerce Logistics Companies Covered
E-Commerce Marketplace Platform Covered
Key Target Audience
3PL Logistics Companies
Integrated Logistics Companies
E-Commerce Marketplace Platform
Logistics/Supply Chain Industry Associations
Time Period Captured in the Report:-
Historical Period – 2019-2020
Forecast Period – 2020-2025
Key Topics Covered in the Report: –
Philippines E-Commerce Market Overview
Cross Comparison- Major E-Commerce Players in Philippines
Philippines E-Commerce Logistics Market Overview
Cost Component for Philippines E-commerce Logistics Industry
Philippines E-Commerce Logistics Market Size
Philippines E-Commerce Logistics Market Segmentation 2020
Philippines E-Commerce Warehousing Landscape
Philippines E-Commerce Warehousing Clusters
Philippines E-Commerce Warehousing Rentals
Philippines E-Commerce Warehousing Cost Analysis
Philippines E-Commerce Shipments Pricing Analysis
Philippines E-Commerce Logistics Market Growth Drivers
Philippines E-Commerce Logistics Market Trends & Developments
Philippines E-Commerce Logistics Market Government Role and Initiatives
Philippines E-Commerce Logistics Market Logistics Constraints
Philippines E-Commerce Logistics Market SWOT Analysis
Competitive Landscape of Philippines E-Commerce Logistics Market
Philippines E-Commerce Logistics Market Cross Comparison
Philippines E-Commerce Logistics Market Pricing Analysis
Future Market Size and Segmentations, 2020-2025F
Covid-19 Impact on Philippines E-Commerce Logistics Market
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Ankur Gupta, Head Marketing & Communications