Evolutions of Retail Sector as Cambodia is increasingly digitally connected

• 12 June 2021
• Local News
• 2738 Views

Cambodia has reached over 20 million mobile phone subscribers by the Year 2020, most of which used smartphones.

As Cambodia’s digital infrastructure continues to improve, this will release the untapped potentials in the ‘mobile internet-users market. The growing number of mobile phone subscribers using smartphones can eventually be translated directly into the markets of advertising and sales sectors.

There is a growing trend of consumers shopping online using smartphones. The growing penetration rate, along with increased credit and debit card circulation are the results of a dramatic uptake in online retail sales, albeit the market is still very small.

Retail companies are beginning to take notice, both in terms of advertising and direct sales. Many traditional store-based retailers are shifting towards multi-channel sales strategies in order to tap into this growing e-commerce market. Although the idea of online sales is still relatively new in Cambodia, and currently represented only a small fraction of overall retail sales. However, this digital advertising is providing new avenues to boost sales. Key Cambodian retailers such as Zando and Ten11, both have launched mobile applications to include their latest products and promotion activities, while other apps such as La Rue or ISSARA, has launched their own marketing-oriented apps to promote their lines of fashion products and to communicate with their consumers.

Several factors will influence the pace of e-commerce expansions in the future. Perhaps the most significant is the fact that internet penetration is continuing to rise. In the past, a significant portion of the Cambodian population doesn’t have the ability to shop online. However, the upcoming infrastructure developments are looking to change this reality, as the local government continued to install broadband infrastructure in towns and villages across the country.

E-commerce growth will grow in line with rising internet penetration. So far, the most popular online shopping category in Cambodia is travel, where consumers booked their air tickets and hotel accommodations online, followed by food & beverage and fashion items. The local e-commerce delivery infrastructure is still developing to meet demand. International courier businesses including FedEx and UPS, as well as Chinese courier businesses such as CE Express, ZTO etc., have all established domestic delivery networks. The increasing number of delivery providers presented in Cambodia will continue to drive down shipping costs, again boosting the attractiveness of e-commerce to consumers.

Looking ahead, the rise of mobile commerce should be aided by plans to introduce ultra-fast internet services, such as 5G internet to the country’s communications infrastructure in order to attract more users into this growing e-commerce market.

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Eric Wong has extensive experience in the field of property consulting and development sectors, primarily within the emerging markets of Southeast Asia. From the property consulting perspective, he has lead market research assignments inclusive of providing descriptive, exploratory market research and analysis reports within the office, residential, hotel and retail segments in both quantitative and qualitative methods to determine suitable development types, scale and product mix, and address property-related matters from project positioning to absorption rates, phasing and pricing and marketing strategies etc.

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