By Jay Ledesma

Online selling fuels economic activity during pandemic 

November 19, 2020, 3:29 pm

WHEN you go to the malls, department stores, restaurants, and groceries, you would see very few people inside. Not many activities can be seen in these establishments. And since we are a country that is known to prefer doing shopping in the actual stores and prefer eating out, seeing these establishments almost empty, will give one an impression that our economy is still at a stand still. You would think that Filipinos have no money, therefore, are not buying.

But this is not actually true. While people have stopped or limited their visits to the malls, department stores. groceries and restaurants, they continue to shop, they continue to spend. What happened was that they changed from retail shopping to online shopping. They shifted from physical space to virtual space for their buying activities.

And we have the pandemic to thank for that. Prior to the pandemic, the Philippines ranked low in e-commerce compared to other Southeast Asian countries like Singapore or Malaysia. We were not as e-commerce savvy as our SE Asian counterparts. But the pandemic accelerated our shift to the online economy.

The e-commerce monitor said that among the SEA countries, the Philippines experienced the highest increase in the terms of shopping app utilization (53 percent), as well as online spending (57 percent). 

Accordingly, the total number of visits to shopping applications in the Philippines climbed to approximately 4.9 billion during the lockdown period. These visits translate to actual online spending that puts money in the pockets of our online sellers.

As more shoppers go online, more retailers/sellers have also brought their products to and strengthened their online presence.

For instance, Shopback (a cashback reward program platform) reported that from 370 partner stores in 2019, 510 partner stores from different categories. are currently on board.

The better news is that most of the new online sellers are from MSMEs. These are the store owners and sellers who were initially affected and displaced at the start of the COVID-19 pandemic. Thankfully, they eventually adapted and shifted to an online platform. Not only are they surviving, but they are also even thriving during the pandemic.

From face masks, cookies, pajamas, skincare, plants to insurance...name it you can find it online. Top sellers or sectors are home and garden, health and fitness, food and drinks, and beauty.

The birth of the Plantitas and Plantitos caused the online sales of plants to grow by 600% during the lockdown. One plant seller said,” in previous years, we were only selling 10 plants a week, now it’s 40-50 weekly”.

Just mere observing the number of the pink and green riders coming in and out of our villages every minute, already tells me the kind of growth the online food delivery sector is experiencing. In the few times I go to restaurants, the take out or pick up is lined up with these men in pink and green.

Lazada and Shopee just had their Mega 11/11 sale. This mega sale event drove a horde of online shoppers to a panic buying spree.

According to Nina Cabrera, the young CEO of the local makeup brand Colourette Cosmetics, she still cannot believe that in the first 35 minutes, they already broke their 2019 11/11 sales. They sold 35,800 of their products (thru Lazada and Shopee) by 12:35 am vs their 25K sales for 1 day last year.

Even the insurance sector has joined the online bandwagon. Insurance companies had to fast track their online platforms, especially when the Insurance Commission allowed digital selling of life insurance versus the traditional face to face selling we’re used to.

However, since most clients are still uncomfortable doing face-to-face meetings, insurance sellers have to find a way to be present in the digital space of their clients.

This prompted top advisor Jay Magleo of Philamlife to create his “Online Insurance Tindahan”. Says Jay, “my biggest challenge when pandemic happened is prospecting. Out of the 468 prospects from my natural market that I connected with, I got ZERO sales. I know I had to broaden my reach digitally. I had to tap the unfamiliar COLD MARKET. So I studied Facebook Advertising because almost everyone has Facebook. And that gave birth to my online insurance tindahan which has so far generated for me 2500++ followers/leads”.

Thanks to the online selling sector, we are seeing more economic activities. With this trend, it’s most likely that from a 10% contribution to GDP in 2015, e-commerce will hit the 25% level.

But with this growth comes responsible internet advertisement and selling. Online sellers should be mindful that they have the obligation to deliver their products and services as promoted and advertised. That there number one objective remains to be client satisfaction!


About the Columnist

Image of Jay Ledesma

Ms. Jay Ledesma writes about local tourism and business bits that delve on investments and insurance.