Morgan Stanley’s internet and retail research teams led by Scott Devitt just published a big report on global eCommerce, which they project will be a $1 trillion market by 2016.
eCommerce and retail are engaged in a zero-sum game: one company’s gain in eCommerce is another’s lost retail sales. As such, the team refers to eCommerce in the context of “retail sales disruption.”
The analysts made five conclusions:
1) Fulfillment infrastructure is critical.
2) Some categories (e.g. groceries, personal care products) are resistant to change.
3) Third-party marketplaces can prosper. For example, Amazon’s third-party volumes are growing faster than its first-party business.
4) Mobile eCommerce is an untapped opportunity.
5) Big players (e.g. Walmart, Amazon) will get bigger thanks to footprint and scale.
The team estimates that eCommerce currently comprises about 6.5 percent of total retail sales globally, and expect that figure to rise to just under 10 percent by 2016.
Morgan Stanley identified 16 companies best-positioned for this ongoing disruption.