The Rise of E-Commerce
E-Commerce has gone from sending ripples to shock waves throughout the financial world in many nations. Though you may overlook it, many people rely on the convenience, affordability and downright simplicity of conducting business online. This has led to great success or great losses depending on the interests in question. In the US alone, E-Commerce is the downfall of many ‘superstores’ and big-box department stores such as K-Mart and Walmart. These were once considered poster children for American consumerism and capitalism. In stark contrast, E-Commerce is also a boon to the service industry, online retailers and competing financial interests in developing nations.
According to IHS Markit, E-Commerce in the US went from constituting 21% of manufacturing sales in the US in 2003 to a massive 64.8% in 2016. During this time, retail E-Commerce grew 17% annually. Naturally, these developments caused rapid alterations in the job market, with many retail store staff finding themselves jobless. Conversely, giants such as Amazon rapidly expanded with many jobs either being mechanized or relegated to stock and warehouse based roles.
A Good Or Bad Thing For The Region?
The Caribbean is not exempt from these evolving market trends as we ourselves have developed a taste for online shopping, services and trade. In the twin island republic of Trinidad and Tobago, the Minister of Finance recently announced that a total of $1.2 billion USD was spent in 2018 on credit card transactions alone. Some argue that such consumerism should be punished with increased taxes or even restrictions. This would ‘conserve foreign exchange’ and coerce locals into purchasing more from retailers.
However, in the long-term, this would mean attempting to poise ourselves as an exception to an emerging and prominent global economic trend. Consequently, it would no doubt reduce consumer choice, accessibility, affordability and competitiveness. This will inevitably lead to increased expense and scarcity overall.
Basic economics aside, a policy of adaption rather than attempting to be the lone tree refusing to bend against the oncoming hurricane may be more prudent. After all, many people wrongly assume that E-commerce is primarily about spending money and foreign exchange rather than earning it. In this regard, the Caribbean also stands to gain based on how we play our cards.
A Boon To Startups And Large Businesses Alike
In the current framework of online interaction, conducting business as an entity is no longer restricted to well-endowed companies. From simple startups to established small businesses or even wholly online ventures, there are a myriad of services available to quickly and readily establish an online store or commercial front.
According to data from BigCommerce, younger generations increasingly prefer to conduct most business online. These range from retail purchases to scheduling appointments, booking tickets, tours and hotels.
On a local level, any small business looking to expand its established customer base could benefit greatly from the reach and ease of access an online platform for potential customers. However, let’s think bigger. Let’s think on a regional scale. What economic activity do many Caribbean nations look towards for earning foreign exchange outside of any industrial ventures? You guessed right if your answer was tourism.
Creating A Digitized Tourist Platform
Did you know that in 2017 Chinese travelers took over 4 billion domestic trips and 100 million overseas trips?
After all, its recent economic growth and rapid acceleration of living standards led to its population having more disposable income. Naturally, innovative companies sought to tap into this opportunity and maximize the Chinese tourism market’s profit potential. One such enterprise was ‘Ctrip’ which boasts over 300 million users. Needless to say, they’ve cornered a significant portion of the market share.
The Caribbean region can learn from such a company as China was quite recently a country with an underdeveloped status. For example, Ctrip CEO Jane Sun revealed that one of their company’s foundational policies involved wholly embracing digitization. China has one of the world’s most ‘digitized’ citizenry.
While Caribbean nations may not match these figures, we as well are slowly becoming more interconnected. Thus, an E-Commerce based focus to tourism could yield considerable benefits for the region. It can also encourage an intake of foreign tourists; even from China’s above mentioned booming market.
The Caribbean’s Digital Potential
Travel agencies, hotels, transport mediums and other services intrinsic to the hospitality industry could be holistically integrated within an online service. These could range from ‘all inclusive’ packages with all the above features included or customization capabilities. In this way, a user can browse and access a wealth of information needed to pique their interest.
Thus, with many extolling tourism as a recommended regional source of foreign exchange acquisition, there are still many simple steps with which the process can be vastly improved by using modern technology. If conducted in a well-coordinated and organized manner, both large and small businesses alike will be able to benefit from such an initiative. They are both vital to the overall enjoyment of a tourism experience.
No one wants a sterile, corporatized experience. The passion of those within small niche industries could shine easily via exposure on an online platform. With that in mind, we’ll continue to look at how E-Commerce can assist smaller ventures and startups with a more precise focus in the future.