The rapid evolution of online payment and cross border trade in Hong Kong

Did you know that the total online sales volume of Hong Kong’s Small and Medium Enterprises (SME) is expected to reach HK$117bn between June 2014 and May 20151? Did you also know that Hong Kong’s SMEs intend to transition HK$79bn worth of sales from offline to online payments over the next 12 months2? While this marks the rise and dominance of online payment solutions in Hong Kong, there are also signs of an increasing trend of local merchants turning to offshore markets to increase their profits.

PayPal’s new Hong Kong SME Opportunity Assessment survey sheds light on this growing trend and on the future of Hong Kong’s SMEs. The Ipsos conducted survey identified the US, UK, China, France and Australia as the top markets Hong Kong SMEs are exporting to, while fashion, electronics and entertainment were the main verticals traded. Not surprisingly, it also found that Hong Kong’s online merchants outperform offline merchants by 160%3.

While Hong Kong’s SMEs are now seeing the huge opportunities that exist overseas, they are also highlighting concerns associated with cross border trade, including logistics, marketing and online payment customer services. At the root of these challenges, there is a lack of market insights and knowledge and exporting experience.

To address this and provide insights to merchants, PayPal has created a new Hong Kong SME Exports Insight Report, in collaboration with Hongkong Post and Professor Leo Sin Yat-ming, Director of the Master of Science Programme in Marketing at the Chinese University of Hong Kong.

The top three greatest challenges identified by Hong Kong SMEs involved in cross border trade are the perceived high delivery costs, the potential damage during product delivery and the long delivery time. Hongkong Post has come on board to address these challenges and offer solutions.

Other challenges of note included the high overseas website listing fees and the low merchant ranking of websites in search engines. Marketing guru Professor Leo Sin Yat-ming has offered insights into how to capitalise on website visibility and search engine optimisation.

Source:

  • Hong Kong SME Opportunity Assessment 2014, Ipsos
  • Hong Kong SME Opportunity Assessment 2014, Ipsos
  • Hong Kong SMB Index 2013, PayPal

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