Decentralization is the future of e-commerce
The global outbreak of Covid-19 is a standout event of 2020 with a decade-long impact. The pandemic has changed all aspects of life, including online shopping habits. But to maintain its growth momentum, the e-commerce industry needs to be innovative and decentralized is one of the solutions.
E-commerce benefits from Covid-19
The world has changed rapidly since the very first Covid-19 case. To curb the spread of the pandemic, people are restricted from gathering in public places. Countless restaurants, hotels, movie theaters… in big cities are closed. Office workers are forced to work full-time at home or even lose their jobs.
However, the experts noted positive changes in online shopping culture. Instead of going directly to a store, many consumers choose to order over the Internet. There are also changes in the segment of the best-selling products and the payment method.
According to Salesforce’s data, the demand for online shopping broke all records, even higher than the regular holidays. This trend maintained even as the pandemic was controlled and many stores reopened in May.
In the second quarter of 2020, global e-commerce revenue was 71% higher than the same period of last year. That impressive figure is thought to be driven by 37% more traffic, 35% increase in conversion success rates, and 34% increase in spending.
Market analysis firm eMarketer forecasts that the global e-commerce industry will reach $ 26.46 trillion in 2020, up 16.5% from last year.
Although demand for online shopping in the two major markets China and India suddenly showed signs of slowing down, other regions such as Southeast Asia still maintained a steady growth at 16%. According to Google, Temasek and Bain & Company, the total transaction value (GMV) of Southeast Asia’s e-commerce industry will be $ 14 billion by the end of this year.
The difficulty of centralized system
The evolution of e-commerce opens up great opportunities for small brands to reach closer to customers. However, businesses often have to pay commissions up to 15-20% of profits to participate on famous e-commerce platforms.
Of course, users also bear a portion of that fee. In other words, they always have to spend more money than the actual value of the product.
Experts believe that decentralization is the answer to this problem. After PayPal launches a digital currency transaction service, millions more will soon accept digital assets as a payment method.
The biggest challenge is to abandon the centralization model because many businesses have heavily invested to build and operate their own retail system, even if it forces users to register too many accounts and cannot make the most out of your bonus points or discounts.
Market analysis firm Deloitte emphasizes: “Businesses need to adapt by using a flexible solution that allows the design of a personalized experience to meet the ever-changing expectations and needs of users”.
Decentralized e-commerce platforms only require consumers to create a single account to shop and receive bonus points. Smart contracts ensure transparency and reduce the risk of fraud even for international transactions. Not to mention, it will eliminate the “middleman” roles to cut costs.
Decentralization has the potential to reshape the e-commerce industry, according to Deloitte, similar to the way DeFi helps 1.7 billion people without a bank account access to financial services. However, it still has many “risk and cost” factors and will be more feasible if retailers work together.
One of the most awaited decentralized projects this year is the InTime e-commerce platform. This product is in the GES ecosystem, promised to bring a completely new shopping experience when applying direct payment and smart receipt through the payment gateway of GES Network.
Scheduled to launch by the end of 2020, this will be one of the first e-commerce platforms to allow users to pay with digital currencies. The company announced it would invest millions of dollars to develop its infrastructure, supply chain, and user community.
InTime developers are gradually revealing information about the product on their website. Their goal is to get 100,000 users in the first year and 500,000 to 1 million users the following year. The company also expects annual revenue growth up to 30% year over year.
In addition to shopping for bonus points like other e-commerce platforms, InTime users can get bonus points in many different ways. Bonus points are considered tokens for direct payment or use in the company’s ecosystem.
Since the past few years, traditional retail sales are declining and businesses are innovating to compete in the market. If InTime is successful as expected, it can open up a new direction to help brands reach customers around the world and contribute to change online shopping culture.