E-Commerce Market to Grow by USD 12.95 Trillion by 2027, Advantages of E-Commerce Platforms Boost Market, Report on How AI is Redefining the Landscape – Technavio

NEW YORK, Feb. 5, 2025 /PRNewswire/ — Report with market evolution powered by AI – The global e-commerce market size is estimated to grow by USD 12.95 trillion from 2023-2027, according to Technavio. The market is estimated to grow at a CAGR of almost 27.15%  during the forecast period. Advantages of e-commerce platforms is driving market growth, with a trend towards enhancement of consumer experience through technologies. However, regulatory issues  poses a challenge. Key market players include Alibaba Group Holding Ltd, Amazon.com Inc., Apple Inc., Best Buy Co. Inc., Costco Wholesale Corp., Ebates Performance Marketing Inc., eBay Inc., Flipkart Internet Pvt. Ltd., Groupon Inc., Inter IKEA Systems B.V., JD.com Inc., Lojas Americanas S.A., Otto GmbH and Co. KG, priceline.com LLC, Shopify Inc., The Home Depot Inc., Walmart Inc., Wayfair Inc., Zalando SE, and Etsy Inc..

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Market Driver

The E-Commerce Market is experiencing significant growth due to the increasing internet usage and smartphone adoption among the population. Digital content in travel and leisure, financial services, and other sectors is driving online browsing and purchasing. Established organizations and large enterprises are embracing e-tailing to expand their customer base. Technological awareness and connectivity are key factors in user experience. Online marketing tools like Google ads and Facebook ads, social media applications, and payment gateways from banks are essential for online businesses. Operational costs, inventory costs, and the adoption of vertical and specialized marketplaces are shaping the e-commerce landscape. The middle-class population’s increasing wealth and online purchasing power are boosting sales. Major e-commerce players like Bharat Craft, Alibaba, and MSMEs on GeM are leveraging the marketplace model and direct model to reach their audience. The rising internet penetration, consumer tastes, and the influence of social media are transforming online retail. Branded shopping apps, 5G Wi-Fi, social shopping, and emerging technologies like augmented reality and virtual reality are enhancing the customer experience. The future of e-commerce lies in the metaverse, where businesses can connect with their clients in  virtual environments. 

E-commerce technology has advanced significantly, benefiting various sectors including home decor. Vendors integrate technologies like augmented reality (AR) and virtual reality (VR) to enhance customer experience. In May 2019, IKEA introduced a VR app, enabling users to virtually experience rooms with their products. Users input room dimensions and select items, viewing different colors and textures through their smartphones. This innovative approach allows consumers to make informed decisions before purchasing. 

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 Market Challenges

• The E-Commerce Market is experiencing significant growth, driven by the increasing internet population and the adoption of smartphones. Digital content in travel and leisure, financial services, and e-tailing are popular categories. Technological awareness and user experience are key challenges. Established organizations and large enterprises communicate with their internet-connected client base through online marketing tools like Google ads and Facebook ads. Infrastructure and operational costs are important considerations. The middle-class population is embracing online purchasing, using payment gateways provided by banks and retailers. Major e-commerce players like Bharat Craft and Alibaba dominate the market, with vertical and specialized marketplaces also gaining popularity. The rise of 5G Wi-Fi, social shopping, and augmented/virtual reality are future trends. MSMEs and the Government’s GeM platform are also contributing to the market’s growth.
• The e-commerce market faces several regulatory challenges that impact businesses worldwide. One issue is the inconsistency in laws and taxes across countries. For instance, developed nations like the US grapple with applying central and state taxes on e-commerce transactions, creating uncertainty. Similarly, less-developed countries have varying legal and tax regulations. Another challenge is domestic incorporation, where governments favor local e-commerce websites to stimulate employment and business growth. Consequently, international e-commerce companies must incorporate locally to access regional benefits. Moreover, each country has unique restrictions on sellable items, adding to the regulatory complexities.

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Segment Overview 

This e-commerce market report extensively covers market segmentation by  

• Application
  • Home Appliances
  • Fashion Products
  • Groceries
  • Books
  • Others
• Type
  • B2B
  • B2C
• Geography
  • APAC
  • North America
  • Europe
  • South America
  • Middle East And Africa

1.1 Home appliances-  The home appliances segment in the e-commerce market, consisting of consumer electronics, houseware, and kitchen appliances, is a matured sector with a declining growth rate. The primary challenge lies in the absence of a comprehensive logistics platform for delivering home appliances purchased online. In developing countries, logistical barriers pose significant hurdles. Despite this, home appliances will remain the largest revenue generator in the global e-commerce market due to the improving standard of living and the growing trend of upgrading homes. Two major factors fueling the segment’s growth are the increasing credibility of e-commerce brands and the preference for upgraded home appliances. Additionally, recycling initiatives have led to a 9% decrease in consumer-generated electronic waste in 2020. The IoT’s adoption in consumer electronics is expected to further decrease e-waste during the forecast period. However, many consumers still prefer purchasing home appliances from physical stores for a tactile experience. Consequently, online retailers are establishing showrooms to provide multichannel shopping experiences, combining the benefits of both online and offline shopping.

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Research Analysis

The e-commerce market is experiencing explosive growth, fueled by the smartphone-using population’s increasing adoption. With the proliferation of digital content, industries like travel and leisure, financial services, and e-tailing are thriving in this online space. Technological awareness and connectivity are key drivers, enabling users to browse and buy goods and services from anywhere, at any time. The user experience is paramount, with established organizations and large enterprises investing heavily in online marketing tools like Google ads and Facebook ads, as well as social media applications, to reach consumers. Buying and selling have never been easier, with operational costs and inventory costs reduced through the use of vertical and specialized marketplaces. Consumer wealth continues to grow, providing a lucrative opportunity for businesses to tap into. Infrastructure and communication are essential components, ensuring seamless transactions and timely delivery of goods and services.

Market Research Overview

The E-Commerce Market has experienced explosive growth, fueled by the smartphone-using population and their increasing digital content consumption. Travel and leisure, financial services, and other sectors have embraced e-tailing, driven by technological awareness and the adoption of smartphones. Connectivity and user experience are key factors in online shopping’s rapid adoption, with operational costs, inventory costs, and payment gateways becoming increasingly important. Established organizations and large enterprises dominate the market, utilizing online marketing tools like Google ads and Facebook ads, as well as social media applications. Vertical marketplaces and specialized marketplaces have emerged, offering niche products and services. The marketplace model and direct model coexist, catering to the middle-class population’s evolving needs. Social media, online purchasing, and communication have become integral to the e-commerce ecosystem, with banks and retailers collaborating to provide seamless payment solutions. The future of e-commerce is bright, with emerging technologies like 5G Wi-Fi, social shopping, augmented reality, virtual reality, and the metaverse set to revolutionize the industry. Bharat Craft and Alibaba are notable players, with MSMEs and the government’s GeM platform also making significant strides in the market.

Table of Contents:

1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation

• Application
  • Home Appliances
  • Fashion Products
  • Groceries
  • Books
  • Others
• Type
  • B2B
  • B2C
• Geography
  • APAC
  • North America
  • Europe
  • South America
  • Middle East And Africa

7 Customer Landscape
8 Geographic Landscape
9 Drivers, Challenges, and Trends
10 Company Landscape
11 Company Analysis
12 Appendix

About Technavio

Technavio is a leading global technology research and advisory company. Their research and analysis focuses on emerging market trends and provides actionable insights to help businesses identify market opportunities and develop effective strategies to optimize their market positions.

With over 500 specialized analysts, Technavio’s report library consists of more than 17,000 reports and counting, covering 800 technologies, spanning across 50 countries. Their client base consists of enterprises of all sizes, including more than 100 Fortune 500 companies. This growing client base relies on Technavio’s comprehensive coverage, extensive research, and actionable market insights to identify opportunities in existing and potential markets and assess their competitive positions within changing market scenarios.

Contacts

Technavio Research
Jesse Maida
Media & Marketing Executive
US: +1 844 364 1100
UK: +44 203 893 3200
Email: media@technavio.com
Website: www.technavio.com/

SOURCE Technavio