Online shopping is among the most popular activities in today’s digital society. Anyone with a smartphone or a computer is able to order online. Shopping in this way is no longer just clothes, gifts, books, or other small items.
Digital Commerce Trends in Central Asia
Groceries and other perishable items are now available in almost any location. It’s easier than ever to have everything you need to be brought to your door with just one click.
This became an important option to have as Covid-19 changed the way we think of the world outside of our own homes.
Coronavirus brought many fields and sectors to collapse, but e-commerce was not one of them. On the contrary, the spread of Covid-19 has helped increase the capital and the success of online shopping.
Customers were not allowed to enter shopping malls or markets to avoid exposure to the new virus, so many turned to online shopping instead.
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Brick and mortar businesses such as malls, supermarkets, clothing, and footwear retailers, and many more were forced to lock their stores and increase their online presence to survive.
The Beginnings of eCommerce in Central Asia
For countries in Central Asia and the Caucasus region, the eCommerce industry is still in its infancy. In some parts of the region like Tajikistan and Turkmenistan, the internet itself only reaches about 50% of the total population.
More developed countries such as Georgia or Kazakhstan may have more internet connectivity but organized financial services reach only half of the population.
It’s important to understand where digital commerce sits nowadays, what trends it has picked, and where it is evolving on the market.
No one can shed more light on this topic than David Kezerashvili, an entrepreneur and investor in the region. Born and raised in Georgia, Kezerashvili has made it his life goal to help Georgia develop its financial and economic potential.
His opinions on the market are not just interesting to follow but also important guideposts for those interested in investing in this region.
We sat down with Mr.Kezerashvili and asked him a few questions regarding his native Georgia’s current digital commerce trends.
Where Is the Central Asia Ecommerce Market Now, and Where Is It Going in the Future?
Reports show that Kazakhstan has the most developed B2C eCommerce sector in the Central Asian region. Azerbaijan is showing the greatest growth in this sector. eCommerce markets there have tripled since 2015.
This probably has to do with Azerbaijan’s efforts to increase internet coverage for the country as a whole.
David notes that Georgians have high internet coverage and a fairly well-developed financial services industry but eCommerce has not seen the growth like Kazakhstan or Azerbaijan.
Amazon appears to dominate the Georgian eCommerce market probably thanks to Amazon’s strong brand awareness.
Kezerashvili goes on to predict that the increases in internet speeds in Georgia will spur growth in local eCommerce companies. His belief is that this is a key moment to invest in eCommerce in Georgia. The sector appears to be poised for big growth in the near term.
As the Georgian market grows the eCommerce companies will need support industries as well. Payment systems, shipping networks, and customer service are all important elements that will require further development in order to grow the industry.
Shoppers need to feel trust in these systems in order to buy into the idea of eCommerce. The Georgian market is still young and developing preferences in areas like online payments.
Will credit cards, eWallets, or another online payment option dominate? Once an order is placed, will it arrive within the timeframe expected? These are important questions that will be answered only with increased investment on the ground.
As an investor, David has established a venture capital firm called InfinityVC. So far it has invested heavily in spreading digital and marketing solutions to nascent Georgian eCommerce companies. For David Kezerashvili the time is now to make long-term investments in this market.
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