Small and medium sized Enterprises (SMEs) and consumers agree that there’s room for further growth in the already booming e-commerce sector, a new e-commerce trend report commissioned by FedEx Express has shown.

Leveraging e-commerce growth is an especially golden opportunity for Australia and Asia Pacific SMEs where cross-border e-commerce is estimated to grow at a 13% annual growth rate (CAGR) between 2020 and 2025 to USD247.5 billion (A$395.71 billion).

“Covid has accelerated our lifestyles to a pivot point where shopping online has been normalised across all demographics, and there’s no going back. With that, e-commerce is set to take a growing proportion of total consumer spend,” FedEx Express president of the Asia Pacific, Middle East and Africa (AMEA), Kawal Preet said.

“With more people shopping online consumer preferences are becoming increasingly sophisticated. As SMEs and e-merchants evolve their online sales platforms, our research uncovers opportunities for businesses to capitalise on what consumers want. Customer experience is the driving force behind how e-tailers engage with their customers and how we are innovating our shipping solutions.”

Australia is the eleventh largest e-commerce market in the world with US$31.3 billion (A$50 billion) in revenue in 2021. The Australian e-commerce market grew by 15% in 2021, contributing to the 15% global growth rate. E-commerce sales are expected to increase over the coming years as new markets emerge and global growth continues, with this development propelled by East and Southeast Asia with their growing middle class and lagging offline infrastructure.

Asia Pacific, which includes the world’s biggest e-commerce markets like India, Mainline China, Japan and Korea, will see revenue from e-commerce sales reaching US$2.09 trillion (A$3.34 trillion) this year as 57% of the region’s population shops online. Additionally, Asia Pacific and Australasia will account for more than 45% of the global absolute value growth in e-commerce from 2020 to 2025. 

Eight in ten SMEs believe e-commerce will become more important in their business in the next three years, with nine in ten believing they are well prepared for the challenge. Regionally, 80% of consumers reported that e-commerce had taken a greater share of their total purchases over the past three years, while 71% see further increases ahead. 

SMEs in Australia acknowledge the increased importance of e-commerce to their business seen over the past three years, with 77% also agreeing it will continue to become even more important in future. Nine in ten SMEs are excited by this and believe they are well positioned to capitalise on this growth. 

For Australian consumers, nine in ten see the growth of e-commerce through a positive lens with the biggest perceived benefit the ability to access products cross-borders at the click of a button. It’s estimated that cross-border e-commerce in Asia Pacific and Australasia will grow at a 13% CAGR over 2020 to 2025 to reach USD247.5 billion (A$395.71 billion) by 2025. 

The survey data reveals a significant 15% gap between how Australian SMEs rate their own e-commerce customer experience and how consumers view it. The biggest gaps appeared in having an efficient returns service (15%) and access to customer support (13%).

Deliveries taking too long was named the number one pain consumer point (49%) followed by handling returns (39%). Consumers typically expect delivery within three days to one week, but there is a clear desire for delivery to be at least more reliable if not faster.