At this point in time, we’re definitely past the eye of the COVID-19 pandemic storm. While in the throes of 2020, the pandemic brought most parts of the global economy to a grinding halt. Fortunately, we are now witnessing a rebound.
Nonetheless, the effects of the pandemic can still be felt, for good or for ill. For instance, during the pandemic, ecommerce sales grew by up to 5 times in some major economies1. As 2021 rolled by, lockdown restrictions were eased and people got a chance to do some shopping outside their computer screens. In spite of this, e-commerce sales grew by 11% in the Q3 20212.
While 2021 is coming to an end, we can expect that the bottlenecks and other issues created by the pandemic would ease in the coming year. This article goes into detail on what trends to expect in 2022 for the global economy in general and digital exports in particular.
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Digital export is essentially the making use of digital marketing strategies in your export business. Digital marketing is an essential cog in the wheel of global trade. As such, it is something you shouldn’t ignore if you want to make sales on the internet.
About 93% of all interactions on the internet take place through search engines3. To get your share of this, you need to pay attention to Search Engine Optimization (SEO), which is a subset of digital marketing.
Another aspect of digital marketing that is important is Social Media. About 98% of sales reps are able to meet and exceed their sales target by making use of social media4. All this goes to show that ignoring digital marketing for your export business is essentially shooting yourself in the foot.
If you’re already implementing digital marketing, then read on to get more insights on the trends to note in 2022. If you’re new to this, then by reading on, you’ll get exposure to the right ideas to guide your exploration of digital exports.
The pandemic had impacts on different sectors of global trade. The services sector was badly hit, especially the transportation and hospitality industry. However, all was not doom and gloom. There are a couple of sectors that experienced growth during and after the pandemic. These are sectors you can look into to determine where to focus your digital exports.
The energy sector witnessed the most growth. Compared to 2020, the energy sector in 2021 has witnessed a 79% growth rate5. Comparing the growth rate to pre-pandemic levels at 2019 shows a growth rate of 19%. This can be attributed to the reopening of the world economy and the subsiding lockdown restrictions.
More people are moving about and as such, the demand for fossil fuels is increasing, bringing the price of oil to a high of $70+ per barrel.
While you might not be directly engaged in exporting barrels of crude, you can export accessories for the industry. Things like helmets for workers, spare parts for machinery and even transport facilities present an opportunity for digital export.
Other sectors with phenomenal growth post-COVID are the metal, minerals, office equipment, and pharmaceutical sectors.
The metal and minerals sectors grew at 46% and 48% respectively compared with pre-pandemic levels6.
The office equipment sector grew at 31%7. This is likely as a result of the reopening of offices. Companies who had to shift to remote work during the pandemic are now returning to the office space. This means that office equipment that has been abandoned during the pandemic has to be restocked.
The pharmaceutical industry grew at 33% and your guess is good as mine that this is largely driven by vaccine issuance and other accessories8. While you might not be exporting the vaccine itself, you can export accessorial equipment like syringes, face masks, and so on.
In the coming year, there are going to be a lot of significant changes and trends that would have an important bearing on your digital exports. These range from the policy landscape all the way to changes in the way digital marketing is conducted.
Being up to date on where issues and ideas are trending is going to keep you one step ahead.
The RCEP agreement is one of the largest trade deals in the world. The agreement would come into effect in January of 2022.
It removes trade restrictions among the following countries: Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand, Vietnam, China, Australia, New Zealand, South Korea, and Japan. The members of this trade deal are about a third of the world population and global GDP9.
The trade deal would remove tariffs among this giant conglomeration of countries. Most of these countries have individual Free Trade Agreements among themselves. However, these smaller trade agreements do not cover goods that are sourced from a broader supply chain.
With the RCEP, if the parts for a product are supplied from member nations, that product would be exempt from tariffs.
This is very advantageous to digital exports as it gives your business the opportunity to export goods to member nations without having to deal with restrictions.
Over the course of the pandemic and its aftermath, the United States has seen strong growth in household balance sheets. This has been fueled by the rising stock and real estate market, along with government stimulus. The result of this is about $2.5 trillion in household savings10.
As we ease into the new normal, households would need to restock on inventories. This is going to release the pent-up demand that has been suppressed by the pandemic.
This would be beneficial for your digital exports as it means you can get more sales from the US market.
The pandemic caused supply chain disruptions are felt all over the world. Unsnarling these disruptions is something that has taken the larger part of 2021. By 2022, we are bound to see a return to normal. The wait time for ships in ports has reduced, and more ships are leaving the ports loaded.
Also, a lot of countries producing elements of the supply chain like Vietnam, Malaysia, and Thailand have vaccinated most of their people. This means there won’t be lockdowns preventing factories from functioning at optimum capacity11.
So, you can expect your digital exports to arrive at their destination faster than was obtainable during the pandemic.
Export industries like pharmaceuticals that have shown growth during this year are likely to continue in that trend in the coming year. The pharmaceutical and medical industry is currently worth about $600 billion12. The large growth in this sector can be said to be due to vaccinations and their accessorial elements.
In the longer term, the aging population in developed countries and the growing middle class in developing ones would fuel demand for this industry beyond the COVID-19 response.
Another sector you should keep an eye out for is the apparel and clothing industry. This is a $400 billion industry. Due to the effect of the pandemic, some consumers who have done most of their shopping online are likely to continue doing so.
Things are even looking up for the industry with virtual try-on technology13. One of the gripes with shopping online for clothes is that there’s no way to try them like you would in a physical store. With this technology gaining steam, people can try clothes online, shifting a lot of shopping dollars from physical to online stores.
Keeping abreast of the marketing trends for digital export is also very important. An important shift in digital marketing is the focus on a better customer experience. About 73% of respondents say that customer experience is an important factor in their buying decision14.
Customers are no longer passive consumers of information. They most likely won’t take your word for the awesomeness of your product. Nowadays, they carry out their own independent research. If they see bad reviews all across internet blogs and forums, that could be disastrous for your digital export.
Another important marketing trend for 2022 is content visualization. You shouldn’t just rely on text alone for your promotional materials. Explore other content like pictures and videos. Studies have shown that people prefer visual content to text15. This has even made YouTube the second largest search engine after Google16.
What better way to get sales for your digital export than a platform trusted by millions of business buyers. Alibaba can help you supercharge your digital export in the following ways:
Alibaba makes it easy for you to get set up on its platform. You have access to a free 90-day onboarding service to help you get started with the platform. Instead of having to reinvent the wheel, you get to enjoy guidance throughout your business lifecycle.
Alibaba has an array of tools to make your sales process easier. You can get a custom storefront that showcases your brand and differentiates it from the competition. You can get this set up without needing to code. You also have access to advertising and analytics tools to help you measure your performance and take action to improve them.
Compared to striking out on your own to find customers, getting access to the more than 20 million active buyers on Alibaba is quite juicy. These buyers come from 190+ countries and make 280,000 enquiries per day.
Now that you have a fair grasp of the forecast for digital exports in 2022, take the next step by selling your products on Alibaba.com. The access to millions of buyers, guided onboarding and analytical tools is an opportunity you don’t want to pass up on.