The Asia-Pacific (APAC) region is one of the world’s largest and most dynamic e-commerce markets.
The region contains 13 countries and 4.3 billion people — including 1.7 billion with internet access — and is already a key strategic stronghold for merchants across the globe. Many are vying to expand their APAC presence even further.
Despite the ample opportunity, many merchants aiming to convert APAC shoppers face an uphill battle — one with significant losses.
A new survey of 500 business leaders from across North America and the UK shows that these firms are losing 52% of their potential APAC sales to cart abandonment, on average — and many are forgoing even more.
If these firms do not invest in cutting down cart abandonment, they will continue to sacrifice a majority of these sales and miss out on the myriad opportunities to be had from engaging the rapidly expanding APAC e-commerce market.
There is no one-size-fits all approach to boosting cross-border conversion, but merchants can implement one innovation to boost their chances with APAC shoppers: payments localization.
International merchants that offer APAC shoppers localized payments experiences reduce their cart abandonment risk by an impressive 32%.
In practice, payments localization means giving APAC shoppers the chance to pay with the methods they use every day, everything from Rakuten in Japan to WeChat Pay and Alipay in China to Kakao Pay in South Korea.
APAC Prioritised
The study provides a first-hand account of how business across the US, the UK and Canada are prioritising the APAC region into their broader growth strategies.
The Emerging APAC Opportunity, reveals that while more than 50% of all APAC e-commerce purchases are abandoned before checkout, merchants agree that accepting local payment options at checkout could reduce that number by nearly half.
APAC countries currently account for nearly three-quarters of total global retail growth, and about two-thirds of online growth.
From 2014 to 2019, the compound annual growth rate for APAC retail sales was more than quadruple that of the rest of the world, and online sales growth nearly doubled the rest of the world’s.
The Emerging APAC Opportunity report underscores the merchant perspective concerning this potential market growth.
- 70% of all merchants surveyed expect APAC sales to increase over the course of the next three years.
- 37% of all merchants anticipate their sales growth to reach or exceed 50%
Still, according to the report, more than half of all e-commerce carts in APAC are currently abandoned prior to purchase, inhibiting this growth potential.
Merchants already operating in APAC identified the two primary factors underlying high cart abandonment rates as cost-related factors (60%) and payment friction (47%).
While cost factors such as shipping and competitive pricing may often be out of a merchant’s control, reducing payment friction is highly addressable.
- 47% of merchants currently selling to APAC customers believe shoppers abandon their carts because they cannot use their preferred payment method or because they have payment security concerns
- Only 13% of merchants currently selling to APAC customers accept domestic global wallets
The small minority of merchants that currently offer localized payment options report cart abandonment rates 32% lower than their counterparts that do not
“Merchants recognise the mission-critical role local payments will play in their success in Asia-Pacific markets,” explains Chuck Huang, Founder and CEO of Citcon.
“70% of the global merchants we surveyed predicted that cart abandonment rates could be reduced by half just by offering trusted, local payment schemes to consumers. Expanding payment options to better serve local APAC consumers has the potential to unlock exponential growth for merchants of all types.”
The report details how cross-border merchants can leverage payments to optimise cross-border conversion and maximise sales in the APAC region.
The post How to cure cart abandonment in the APAC e-commerce market appeared first on Payments Cards & Mobile.
