As the Covid-19 pandemic has fueled ecommerce to take the forefront in retailing, are you wondering which are the largest e-commerce companies in the world, that are taking the lead in the entire industry? 2020 has been a rather interesting year for industries where certain industries have struggled to keep the margin up, while others have smoothly ridden the wave of changes for their advantage. The perfect example for an industry which has catered to the peculiar demand trend amidst the lockdowns all across the world, by providing the world the means to stay connected, is the communications technology industry. Zoom Video Communications (NASDAQ:ZM) is a classic case study where revenues doubled just as the pandemic hit, as more and more people shifted to online communications and workplaces turned remote overnight.
E-commerce has been yet another industry that received an unexpected boom with the lockdowns becoming effective worldwide, and with massive change in consumer behavior. As traditional retailing took the hit, e-commerce emerged as the preferred buyer market. E-commerce saw an amazing 129% YOY growth in the US alone, and it is expected that the segment will comprise over 14% of the entire retail industry in 2020, marking the biggest increase in online retail ever. As consumers worldwide are shifting to the online mode of buying, the consumer base of the e-commerce segment has increased more than ever before. The folks that preferred in-store buying have now, because of the lockdown, looked for more online purchases as this mode provides much more convenience in these unprecedented times. The result - the widening of sales from regular customers as well as added new customers to the existing consumer base. It is unlikely that the e-commerce segment will lose these new customers once the pandemic is over, as the initiation into online buying has already taken place. It is unlikely that people will stop online buying even after the pandemic is over, at least not immediately.
The biggest gainers in this unforeseen situation have been the largest e-commerce companies in the world. The biggest companies have taken the biggest piece of pies it seems. With already established consumer bases, brand image and robust logistics in place, these companies have successfully reaped the benefits of the change. Amazon Inc, is likely to see a 28% to 38% sales growth in 2020 than the previous year, which is quite an astounding growth figure.
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A robust supply chain is indispensable to the e-commerce industry and a dependable and streamlined logistics chain is what has kept the e-commerce industry resilient in these unprecedented times. While some e-commerce giants partner with delivery services like FedEx Corporation (NYSE:FDX) , others like Amazon have their own delivery networks. In fact Amazon has been able to build up its consumer base thanks to efficient supply mechanisms, that enables it to reduce delivery times and create a streamlined system, while helping out small time retailers on its platform to make the most of its established supply chains. However, while e-commerce orders have flourished in the pandemic, pressure has built up on the supply side. Sudden increase in orders have been coupled with slowdowns in the logistics, leading to bottlenecks that e-commerce businesses have had to deal with to keep up their momentum.
E-commerce is in the constantly evolving phase, and even after the push from the pandemic dies down, the segment is expected to see some important changes and spearheading of sub-segments within its umbrella. Amongst the new trends that might be seen in the near future, is the emergence of Direct to Customer and Private Label brands. Looking to provide personalized offerings and maintaining direct relations with customers several traditional brands are willing to detach with retailers. Direct selling also gives access to valuable consumer data which is fast becoming the retail gold. Brands are extensively looking to monetize consumer data, to get first mover advantage and provide personalized products. Data, therefore, will be the next big thing in the e-commerce business, and soon Big Data will be playing a big part in providing personalized experiences. Entering into 2020, we have already seen the shift of e-commerce to become more technology driven, and the part of technology is only expected to increase from here on. In the next transformation for the industry we shall see voice searches expanding to a great extent and PWA technology will also come into play. The e-commerce business that has generally caused concern around sustainability issues, is also expected to step into creating more environment oriented strategies in terms of supply chain, packaging and more. As customers are becoming increasingly aware and demanding lesser packaging from the industry, soon, the players in the industry are likely to start experimenting with more biodegradable packaging options. Shift might also occur towards creating more sustainable supply chains, as traditionally online retail formats pose the issue of increasing carbon emissions in creating multiple lines of distribution. To get an idea of how other industries are doing in the wake of the pandemic, and latest industry specific trends, take a look at our other article 11 Biggest Insurance Companies In the World.
It is apparent that going forward the e-commerce segment is likely to grow to become a major segment of retail. The largest e-commerce companies in the world are expected to hold their positions and expand their customer base as the industry prepares to boom further. To compile a list of these companies, we have ranked them by their latest revenue figures. While some of these companies are exclusively into e-commerce business, others like Walmart Inc. (NYSE:WMT) are retail players foraging into the e-commerce space and some others operate in other segments as well, e-commerce being one of the businesses in their portfolio. We have considered the e-commerce sales figures in the current year to arrive at our list of top players.
Let’s take a look at 15 Largest Ecommerce Companies in the world
American retail giant, Walmart, is equally a major player in the retail space. Around 600 bps of its net sales in 2020, were attributable to the e-commerce segment. The e-commerce net sales growth was over 97%, and has contributed to the overall net sales of the company extensively.
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14. Flipkart
E-commerce Revenue - $5,861,610,000
Singaporean e-commerce player, headquartered in Bangalore, India, recently sold a major stake to Walmart. The e-commerce company initially broke into the online retail space by selling books, but eventually transformed into full-fledged retail sales and became one of the pioneers of online selling in India. In the first half of 2020, Walmart Inc led a $1.2 billion investment in Flipkart Group, pulling the company value to $24.9 billion.
13. Zalando
E-commerce Revenue - $7,814,680,000
Europe’s Zalando, based in Berlin, operates in the fashion and lifestyle industry across 17 markets in the region. Zalando is clearly Europe’s leading online sales platform.
Online store selling furniture and home goods, Wayfair, has created a special niche for itself in the US market, that makes it one of the largest ecommerce companies in the world. As the Home Category Online grew by 15% in the U.S. in 2019, Wayfair enjoyed a significant advantage from the push, with around 38% of the market share under it.
11. Otto
E-commerce Revenue - $ 9,549,510,000
German leading E-commerce platform, Otto, primarily serves the retail market but also provides retail services and high value, personalized customer advice in both online and offline modes. The group company recently expanded its business into real estate and financial services.
The American MNC offers customer-to-customer and Business-to-customer formats of retail sales through its web portal. Ebay operated in over 32 countries worldwide. The company’s Revenue in the third quarter was up by 25% year-on-year.
One of the leading Department Store chains in the US, Macy’s is making its online presence felt as well. In-store sales suffered significantly this year due to the Covid crisis when major stores including Bloomingdale’s were closed. The company saw a 53% rise in online sales, however, not enough to offset the retail slowdown suffered.
Operating in the wholesale retail format, Costco, is the second largest retailer in the world after only Walmart. The company operates e-commerce sites in several countries including e-commerce sites in the U.S., Canada, the United Kingdom, Mexico, Korea, Taiwan, Japan, and Australia..
Chinese retailer, Suning, has a major presence in China and Japan. Its E-commerce wing Suning.com is one of the top 3 largest e-commerce sites in the country. The site deals in a wide variety of product categories including home appliances, books, household commodities and cosmetics.
Best Buy occupies the retail space in the consumer electronics segment. The company’s online sales increased three fold during the second quarter of 2020 as a result of pandemic buying. Also Best Buy in-store sales picked up right after lockdowns were eased.
