Millennials (those between the age of 18-34) engage more in domestic online transactions than cross-border transactions, a recent report by Ipsos on behalf of American online payments firm PayPal says. The research conducted from September to October 2015 on 23,000 individuals in India and abroad, reveals that 61 percent of millennials shop from domestic portals while the remaining 39 percent who engage in both cross-border and domestic transaction.
Of all millennials surveyed, 82 percent shopped online in the past 12 months, and 86 percent chose PayPal to make their transactions, revealed the report.
Calling millennials “bold” and “tech savvy”, Anupam Pahuja, Managing Director and General Manager of PayPal Asia Pacific told BloombergQuint in an interview that the proportion of millennials spending on cross-border transactions is expected to rise in the coming years with more payment gateways opening up.
The same was echoed by Anil Talreja, Partner at Deloitte, who follows the e-commerce sector closely. He said that the primary reason for increasing cross-border transactions among millennials is that they find comfort in the online payment mechanism.
One of the very critical elements that comes into play isthe payment mechanism. You only have an option of using specific payment methods.That's where millennials come in, they have sorted out ways on payment. Theyare ready to take the risk of online payment. Some payments may require aninternational credit card. That is something the millennials will do easilythan slightly older counterparts.Anil Talreja, Partner, Deloitte
Retail Therapy
Here are other key highlights of the Ipsos-PayPal study:
- United States is the most popular destination for online shoppers which constitutes 27 percent, followed by China (11 percent) and United Kingdom (10 percent). Singapore is also popular for online shopping. New markets such as Germany and Canada have also showed up in the study.
- The biggest categories for cross-border online shopping are clothing/apparel, footwear and accessories. Fifty-nine percent of millennials buy products from these categories from abroad, while only 53 percent of those surveyed among the general buyers said that they purchased these products from foreign websites.
- The next big category is consumer electronics for which the millennials shop more than the others. Even in the watches and jewellery segment, millennials do more cross-border purchases.
- Millennials are more likely to buy events tickets online.
- Cross-border shopping is gaining popularity among millennials because they feel foreign products are of better quality.
- Many millennials chose domestic transaction over cross- border transactions because of additional shipping costs involved.
- Among devices, shopping via smartphones has gained traction. Almost a third of both domestic and cross-border transactions are made on smartphones. However, a majority of shoppers still uses desktops and laptops to shop online.
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