PayPal study: Merchants looking to enter the HK should strike now

PayPal’s latest report reveals that online retail sales are expected to grow by 50% to US$7.4 trillion by 2025. Cross-border eCommerce remains a staple for many Hong Kong merchants, who have invested in growing cross-border trade and eCommerce. 

The survey looks at the latest trends and consumer thoughts and behaviours in key markets around the world with collected responses from 14,000 consumers aged over 18 from December 2021 to January 2022, who purchased online in the previous three months. The study covers markets such as Hong Kong, Australia, Brazil, Canada, China, France, Germany, Italy, Japan, Mexico, Singapore, Spain, the UK, and the US.

In Hong Kong, 77% of online shoppers have made purchases from international websites at the end of 2021, and as such merchants looking to enter the Hong Kong market can do so now as it is a prime time with many willing to buy from abroad, according to the report.

In fact, in Hong Kong, 47% of respondents choose to shop cross-border because of better prices, and 45% prefer cross-border shopping due to higher product quality. Around 41% purchase from other markets due to items not being available locally. Around 71% of respondents said they would shop cross-border on online marketplace, 53% via brand website and 49% via store or retailer website.

Interestingly, 75% of respondents are willing to put up with longer shipping times from global merchants if a product is less expensive, and 73% prefer large global marketplaces when purchasing from another market. Approximately, 68% prefer to buy from a website based in another market if they cannot get what they want from their markets.

“Many merchants in Hong Kong have invested in and capitalised on the recent rise of cross-border online shopping around the world,” said Tim Fu, market leader of PayPal in Hong Kong, South Korea and Taiwan.  While there are no signs of the cross-border eCommerce opportunity abating, this year merchants are presented with new challenges such as an increasingly competitive landscape as well as emerging economic headwinds, Fu explained.

Nonetheless, despite the headwinds, the opportunities are out there for the taking. "Cross-border eCommerce continues to be an effective strategy for new sources of growth. Successful merchants will be those who can quickly act and adapt to the latest consumer and global eCommerce trends. For instance, in an environment where there is pressure on spending, value for money and a more flexible payment experience are priorities for shoppers," Fu added.

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