The first quarter of 2016 brought with it a number of interesting statistics and trends in global digital commerce. New countries are high risers, while former niche payment methods are slowly becoming the new norm. We have summarized all that and more in Avangate’s Quarterly Digital Commerce Benchmark. Here are 5 of our key findings.
- Digital Commerce Success Reflects Economic Health. Countries on the Rise; Countries in Decline
An interesting finding of our study is that digital commerce growth goes hand in hand with a country’s economic success Tweet. Countries like Singapore and Indonesia are experiencing growth in terms of software, SaaS and online services purchases, which may be directly tied to their economic outlook. These connections are no coincidence. For the future, recognizing and moving into markets in which the economic situation is on an upward slope can lay the groundwork for digital commerce success.
Countries experiencing a decline in software purchases in Q1 2016 compared to Q4 2015 include Nigeria and Russia. Both countries’ GDP contracted in Q1 2016, so it is not surprising to see also a decline in software purchases.
- Western Nations Continue to Dominate Commerce When it Comes to Software Sales
While the nations experiencing the most growth during the first quarter of 2016 are almost exclusively emerging markets, they don’t (yet) scratch the surface of the top performers in terms of volumes. The top 10 countries list provides no surprises, in terms of digital commerce value, Western nations still matter.
The lesson is simple: emerging markets are attractive, but Western nations should never be discounted as the big revenue generators for online software sales. Tweet
- Security and Privacy Top of the Purchase List Around the World
There is no country in the world that doesn’t have security or privacy in its top 3 product preferences. US residents also take a great interest in digital services and vertical specific software such as finance (credit scoring), health or education.
- Visa and MasterCard Overshadow the Payments Space. Other Methods Are Key Players in Their Local Markets
Counting for a massive 70% of global software and online services purchases, Visa and MasterCard have a $50 average order value (AOV) in Q1 2016, slightly above the global $49. At the same time, it should be noted that some local payment methods are the big players of their respective markets, with AliPay in China getting more than half of that country’s purchases and iDeal coming next for the Netherlands, with 38% of Dutch software sales. PayPal’s biggest popularity is in Germany, with 51% of payments taking place under this brand. Tweet
- Emerging Markets Are Becoming Accessible
The continued rise of nations like Singapore, Qatar, Indonesia, along with the increasing relevance of international payment methods, means that emerging markets are becoming increasingly accessible for digital commerce. Payment methods such as WebMoney or Qiwi, although still with a small percentage and with low AOVs, look promising and help enter new markets more effectively.
Check out the Avangate’s Quarterly Digital Commerce Benchmark Infographic here. For more insight into what you need to do to expand into new regions, download this eBook on Global Commerce in Local Markets for Software and SaaS Companies.