The market for generative AI (GAI) applications will grow from $6.2 billion in 2023 to $58.5 billion in 2028, with a CAGR of 56%, according to Omdia.
The value of the cross-border eCommerce will exceed $3.3 trillion in 2028, from $1.6 trillion in 2023, according to Juniper Research. With disposable income rising in developing markets, eCommerce merchants and marketplaces are pivoting towards them.
Given the prevalence of alternative payment methods in developing markets, such as mobile money, cross-border merchants must effectively match consumers’ payment preferences, or they will quickly lose out to better-localized rivals. Cross-border eCommerce transaction values will grow by 107% globally over the next five years.
This data demonstrates that much of the growth in the eCommerce payments market is in the cross-border area. This happens due to the rapid expansion of key marketplaces, and how they have differentiated themselves. For example, JD.com provides fast delivery times thanks to its strong logistics network. AliExpress offers considerably cheaper goods that offset the longer-than-preferred delivery times for consumers, while Amazon, Rakuten, and Mercado Libre provide value-added services, like streaming and integrated financial services. Marketplaces must offer a differentiated consumer experience to be successful, but must also add value for merchants, to sustain rapid growth.
The research found that in an increasingly social media-dominated advertising landscape, the leading vendors are effectively marketing directly to consumers. Central to competing with domestic merchants is appealing to digitally engaged users directly; making social media advertising vital for success. For example, Temu has accompanied launches into new markets such as the UK & US with highly targeted direct advertising to users, fuelling rapid growth. Cross-border merchants must therefore correctly identify the right social media and digital advertising channels in each market, or risk losing out in the battle for tech-savvy consumers.