Hong Kong
  • Singapore
  • UK
  1. Osome Blog Hong Kong
  2. Hong Kong Statistics for Aspiring E-commerce Entrepreneurs in 2021

Hong Kong Statistics for Aspiring E-commerce Entrepreneurs in 2021

Hong Kong Statistics for Aspiring E-commerce Entrepreneurs in 2021

E-commerce is developing rapidly in Hong Kong as more retailers set up their online presence and shoppers change their consumption patterns and lifestyles. With more than 4.5 million online shoppers, the e-commerce penetration rate in Hong Kong is at 59.8% in 2018 and is expected to hit 72.6% in 2022, and e-commerce sales in Hong Kong have been steadily increasing. With a growing market, there is no better time than now to set up your e-commerce company.

Market Size

Expected Revenue Number of Users
US $7,598 million 4.5 million

In Hong Kong, revenue in the e-commerce market is projected to reach USD $7,598 million in 2021 according to Statista. Revenue is expected to show an annual growth rate (CAGR 2021-2025) of 10.5%, resulting in a projected market volume of USD $11,308 million by 2025. Hong Kong e-commerce market's largest segment is Fashion with a projected market volume of USD $2,337 million in 2021.

How Covid-19 Has Impacted Hong Kong’s E-commerce

covid-hk
Most Affected Areas of E-commerce Business by Coronavirus Outbreak in Hong Kong 2020

According to a study by Paypal, approximately 86% of mid to large e-commerce enterprises’ had problems with logistics and fulfilling orders. 43% of the merchants’ cash flow also suffered due to Covid-19.

From the consumer side, more than half of Hong Kong’s online shoppers bought more groceries and personal hygiene products online between January and June 2020. Less money was spent on non-essential products during this time as many Hong Kong consumers were threatened by job losses or lower earnings.

The new top purchase criteria in Hong Kong are found to be value for money, ease of shopping experience and product quality. Consumers’ overall positive online shopping experiences ensure that they would continually frequent and make more purchases from e-commerce stores compared to before the start of the coronavirus outbreak, KPMG’s study highlighted.

The most popular online stores and marketplaces in Hong Kong are Alibaba’s Tmall, WeChat, Taobao, Amazon, JD, Alibaba and eBay.

E-commerce Key Metrics and Statistics for Hong Kong

Key Metrics

payment value hk

Hong Kong’s e-commerce market is projected to witness an increase in compound annual growth rate (CAGR) of 9.9% from 2019 to 2024, where it will be worth about HKD $226 billion (USD $29 billion) in 2024, GlobalData’s E-Commerce Analytics revealed.

E-commerce transactions were expected to register a sharp increase of 13.4% in 2020, where consumers spend their dollars online instead of in physical stores.

Hong Kong’s user penetration would cover 73.1% of the population in 2021 and is forecasted to reach 83.8% by 2025. The revenue generated by an average Hong Kong user (ARPU) would be USD $1,375.89 in 2021, Statista projected.

Key Statistics

top segments hk

According to JP Morgan’s 2019 study, travel, health and beauty, and consumer electronics are the top three e-commerce categories in Hong Kong.

Online Payment Methods

JP Morgan HongKong Graph 05

A quarter of all e-commerce payments in Hong Kong (HKD $0.9 billion per year) are completed by digital wallets, making it the second most preferred payment option in Hong Kong.

In 2021, digital wallet transactions would exceed those done by cards, as it is growing at a compound annual growth rate of 32%. Digital wallets are set to eventually outperform all other e-commerce payment methods in Hong Kong by this year. Hong Kongese’ most popular digital wallets are PayPal and AliPay.

Cross-border Purchases

Hong Kong online consumers are also buying from overseas, with China topping the list. Singapore and Japan are also popular options.

Global Comparison

percentage ecomm
2019 Sales Value of Internet Retailing as a Percentage of Total Business Receipts/Retail Sales

In 2019, Hong Kong’s sales value of internet retailing as a percentage of total retail sales is 5.7%, less than half of the world average of 13.7%. China leads at 34.1%, while the UK's percentage of online sales out of total business receipts  is 21.8%, followed by South Korea at 21.6%.

Hong Kong E-commerce Trend 1: More retailers go online in Hong Kong

Hong Kong’s physical store retailers have incurred losses since the pandemic, with Year on Year sales decreasing by 44% in February 2020, according to its Census and Statistics Department’s data. The stores needed an online presence to survive.

A Nielsen survey found that for the food and beverage sector 46% of Hong Kong consumers preferred eating in their homes than dining out. The Hong Kong people are increasingly opting for food delivery, takeaways and cooking at home during the peak of Covid-19 outbreak in 2020, and this trend would likely continue into 2021.

Businesses in Hong Kong are widely adopting the online-to-offline model (O2O) to meet online demands. According to Shopline, more than 50% of Shopline’s e-commerce Hong Kong retailers own physical stores. In the long term, 20% of its merchants are considering fully adopting the O2O model, supplemented by setting up pop-up stores.

Traditional brick-and-mortar retailers are enticed to adopt the O2O model as they could sell 24/7 online, and not be limited by store closures during the night. 78.3% (almost 4 out of 5) of the merchants believed that being operational round the clock would give them a competitive advantage.

Hong Kong E-commerce Trend 2: Consumers increasingly opt for bank transfers and digital wallets when shopping online

Bank transfers and digital wallets see increased adoption rate in Hong Kong at 12 percent compounded annual growth rate and 11 percent compounded annual growth rate respectively. An estimated 48 percent of all online transactions would be done by bank transfers and digital wallets by 2023.

At the same time, Hong Kong shoppers are growing out of prepay methods (27 percent drop in CAGR), debit cards (14 percent drop in CAGR), and cash on delivery (13 percent drop in CAGR).

According to Worldpay Merchant Solutions, more consumers prefer to shop on their mobile phones and that this trend will continue to grow. Merchants who study their consumers’ behaviours and provide an engaging online experience for them would profit in their e-commerce businesses. Hong Kong e-commerce merchants should offer the digital wallets that their consumers frequently use, as digital wallets transactions would make up a third of all purchases in Hong Kong’s e-commerce purchases over the next five years.

Ready to set up your e-commerce company in Hong Kong? Focus on buying the best products to sell and growing your business while we take care of all the administrative work from the necessary documents to file, to the accounting work for e-commerce companies.

Share this post:

Tips to run your business smarter.
Delivered to you monthly.

You'll receive a verification email you'll have to open and confirm the subscription.

You might like it

Streamlining Payroll Process for SMEs: 5 Tips
Payroll

Streamlining Payroll Process for SMEs: 5 Tips

For a business to run smoothly, the payroll process must be streamlined and error-free. It is easy to streamline and optimize your payroll and other back-office processes within your SMB. Did you know that this can improve your cash flow?

A Guide to Offering Free Shipping Profitably
E-commerce

A Guide to Offering Free Shipping Profitably

Have you ever wondered who pays for the free shipping when you shop online? Turns out, it is possible to offer free shipping and have a profit margin at the same time.

A Guide to the Top e-Commerce Payment Gateways in Hong Kong
E-commerce

A Guide to the Top e-Commerce Payment Gateways in Hong Kong

Other than branding and marketing, these technologically savvy consumers are well acquainted with the Internet and convenient payment gateways and demand nothing less than a seamless e-commerce transaction.

8 Photography Tips for Your E-commerce Store
E-commerce

8 Photography Tips for Your E-commerce Store

Want to kickstart your start-up or bolster an existing online business? These 8 e-commerce photography tips could have a direct impact on small businesses owners in Hong Kong, take a look.

What To Do If I Want To Change My Company Name And Information?
Secretary

What To Do If I Want To Change My Company Name And Information?

If you want to change your company name, it’s relatively easy to do so in Hong Kong. And if there are other changes happening in your company - such as change in registered office address, new company director or secretary - you have 15 days to report these changes to the Companies Registry.

How To Hold Annual General Meeting
Secretary

How To Hold Annual General Meeting

The phrase “annual general meeting” (AGM) may conjure in your head an image of a hall filled with agitated shareholders grilling a row of executives seated on stage with difficult questions about the business, thanks to media coverage of AGMs in listed companies.

The Search for Niche Products and Getting Started Online
E-commerce

The Search for Niche Products and Getting Started Online

Launching an online business is not an easy achievement, with increasingly more entrepreneurs entering the online market space. Competition is fierce, product ideas are saturated, and consumers are getting more well-versed in sieving out the best prices for online products.

Deadlines To Keep In Mind To Stay a Compliant Company in Hong Kong
Secretary

Deadlines To Keep In Mind To Stay a Compliant Company in Hong Kong

Tax and filing deadlines are the bane for many company directors, but we can be fairly certain they’re here to stay. Whether you’re a Type A (“Deadlines are easy!”) or Type B (“When is my next deadline?!”) entrepreneur, we’ve put together this handy guide for you.

Annual Return Filing Dates To Take Note of for New Business Owners
Incorporation

Annual Return Filing Dates To Take Note of for New Business Owners

New business owners or even company officers may not be familiar with the necessary paperwork to deliver to local authorities for annual requirements. Everything is new. Starting a business in Hong Kong is already so tough and now there is paperwork to deliver to be compliant?

Osome Raises $16M in Series A Round for Its AI-based Accounting Platform To Expand Globally
News

Osome Raises $16M in Series A Round for Its AI-based Accounting Platform To Expand Globally

Osome has raised $16M in a Series A funding from a group of investors including Target Global, AltaIR Capital, Phystech Ventures, S16VC, Ace & Company and Peng T. Ong, who joined as an angel investor.

What Happens When You Avoid Tax in Hong Kong? A Guide to Tax Evasion Penalties
Tax

What Happens When You Avoid Tax in Hong Kong? A Guide to Tax Evasion Penalties

Hong Kong is well-known for its simple and straightforward tax regime, which makes the country one of the best places you could start a business in. However, despite the favorable tax rates, there are still cases of tax evasion which leads to legal consequences.

Osome Is Named Singapore Partner of the Year at Xero Asia Awards
News

Osome Is Named Singapore Partner of the Year at Xero Asia Awards

A confirmation of Osome’s commitment at innovation and customer service, this is simply a great way to end 2020. Find out more on how and why we won.

Tips to run your business smarter. Delivered to you monthly.

You'll receive a verification email you'll have to open and confirm the subscription.

We’re using cookies! What does it mean?