📈#014: Why the new e-commerce wave isn't coming from Silicon Valley

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In this week's edition, we spotlight the innovative e-commerce models and disruptors emerging from outside the Silicon Valley bubble. From the rise of social commerce giants to the live-streaming "shoppertainment" concept, we'll explore the dynamic retail tech companies beating the West at their own game – and the factors driving this global shift in e-commerce innovation.

Let's dive into these insights together!

— Insights Team, Rwazi

Our Edition this week:

• Data Spotlight

• The Pulse

• Sector Scan

• Our Competitive Watch

DATA SPOTLIGHT
E-commerce superstars beating Silicon Valley

The numbers don't lie - embedded social shopping experiences are having a breakout moment, becoming the norm and disruptively emerging from niche to mainstream worldwide. Its growth trajectory is only accelerating, with social commerce projected to become a $3.37 trillion market by 2028 with an expected compound annual growth rate (CAGR) of 13.7%.

While Silicon Valley wrestles with the latest overhyped tech trends, a new breed of e-commerce disruptors is quietly redefining the rules of e-commerce beyond Western borders:

• Shein and Temu have reinvented e-commerce into a hyper-affordable, hyper-responsive model deeply embedded within social platforms like TikTok and Instagram, serving as a catalyst between content consumption and instant gratification through seamless shopping experiences.

• Despite concerns around sustainability and labour practices, the success of these online retailers is undeniable, fueled by their ability to quickly translate social media trends into shoppable products at unprecedented speeds and low costs.

Key Insight: By leveraging the power of social media integration and lean supply chains, these disruptors have unlocked a new era of e-commerce that legacy Western retailers have struggled to replicate.

Key Stats

• Share of global e-commerce sales from emerging markets: 38%

• Projected social commerce market size (2028): $3.37 trillion

• Mobile live-streaming e-commerce users in China (2022): 384 million

THE PULSE
Featured Chart: Digital Commerce Index growth for rising markets (2023-2027)

SECTOR SCAN
"Shoppertainment" and the live-streaming commerce boom

A new breed of "shoppertainment" platforms is also gaining significant traction, blending entertainment, influencer marketing, and direct sales into an immersive live-streaming experience:

• Shopee, the $70 billion Singaporean e-commerce giant, has pioneered this model, enlisting popular online personalities to compete in real-time sales events, driving remarkable engagement and revenue growth across Asia and Latin America.

• The success of shoppertainment underscores the power of leveraging existing consumer behaviours and preferences, meeting audiences where they already are rather than trying to funnel them into traditional e-commerce funnels.

Key Insight: By fusing commerce with entertainment and leveraging the authenticity of influencers, these live-streaming platforms have unlocked a level of customer engagement that eludes many Western e-commerce incumbents.

OUR COMPETITIVE WATCH
Emerging market innovators reshaping global e-commerce

A diverse array of innovative e-commerce models is also taking root across emerging markets, from Africa to Latin America:

• Jumia has cracked the code on facilitating cash-on-delivery in Africa, a critical solution for regions with low banking penetration.

• In Latin America, Oxxo is evolving from a brick-and-mortar convenience store chain into an ambitious online bank and e-commerce platform akin to a "PayPal meets 7-Eleven" model.

• Even within China, upstarts like Pinduoduo are already threatening to unseat established social commerce giants with unique spins on the model.

Key Insight: By tailoring their approaches to the unique needs and nuances of local markets, these emerging innovators are capturing lucrative regional opportunities and pioneering models with global disruptive potential.

WHAT’S HAPPENING AT RWAZI?
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