In recent years in Sri Lanka, e-commerce websites have mushroomed as the internet penetration rate has increased. Though local e-commerce companies are still in their infant stages compared to the rest of the world, Sri Lankans now have the option to buy electronics, flowers, office supplies, clothes, and even vehicles online.
For aspiring local entrepreneurs, the e-commerce business is now more competitive than ever. Local versions of popular retail websites like Amazon have outnumbered previously numerous news websites. The country also expects internet penetration rates to rise in the future. All in all, it seems like a good time to start an online business.
But the biggest question online entrepreneurs face is what to sell online. Not just any product will sell well in Sri Lanka. Therefore, it will be helpful to know which products are in demand online. The popular products that non-online consumers prefer will not be equally popular online. Read ahead to find out which products have the best conversion rates online.
First of all, it’s important to understand online consumerism in Sri Lanka. The internet penetration rate in Sri Lanka is around 22 percent, according to Colombo Digital Marketers. Not high enough to make a business into a multimillion rupee venture, but enough not to ignore.
Unsurprisingly, close to 50 percent of web users in Sri Lanka are in the 25-34 age range, according to data published by Kaymu, the largest online retailer in Sri Lanka. A little more than 60 percent of web users in Sri Lanka are younger than 34.
In Sri Lanka, 68 percent of people who buy from e-commerce websites are male. Only 32 percent are female. The conversion rate by gender mirrors this statistic, with males more likely to end up making a purchase.
Also, urban users lead the e-commerce market in Sri Lanka. Sixty percent of all online transactions in the country originate from only three cities: Colombo, Kandy, and Galle.
It’s also important to note that the majority of the traffic to retail websites is generated by Windows-powered desktop or laptop users. Around 25 percent of the traffic is generated by mobile and tablet users. Android is the preferred smartphone OS among Sri Lankans.
According to Kaymu, Sri Lankans mostly browse the web for electronics and mobile phones. Used and new vehicle sites follow closely behind. After that, employment, clothing and accessories, real estate for sale, education, and travel searches dominate the remaining search results.
Mobiles and dresses were the most searched for Google terms from 2013 to 2015. Watches are the best selling products on local retail websites.
Considering the statistics above, the best product to sell online in Sri Lanka is a watch. However, an e-commerce website can also do well selling consumer electronics or apparel items. The target audience would ideally be male consumers under 34 years with access to a computer, and perhaps a smartphone as well. Clothing items are more popular among females. Popular online search queries for clothing often include terms such as “girls” and “women”. Also, sarees are the top selling clothing item online in Sri Lanka.
However, entrepreneurs should be open to innovation and breaking new ground in the local online market.
Once you know what your perfect product to sell will be, you will have to market it.
If you notice from the statistics above, the top selling e-commerce products in Sri Lanka—watches, clothing, consumer electronics—are items with high purchase frequencies and high values. Meaning, people are likely to keep buying these items, even at high prices. Also, vehicles, another top selling category, have high item values and a low purchase frequency. People don’t buy cars all the time. The best strategy to market the product you want to sell will depend on these aspects.
In general, Sri Lankans don’t mind buying items with high values over the internet. This is good news for advertisers like ikman.lk, as item prices don’t necessarily have to be set low for a buyer to make a decision. On the other hand, the purchase frequency determines how you should target your customers.
Items with a high purchase frequency, like a smartphone, should be marketed to retain existing customers. Items with a low purchase frequency, like a car, will have to be marketed to attract new buyers. So, how you should market will depend on what you are selling online.
If you are selling clothes or electronics, your marketing strategy should focus on existing customers. You can employ methods like emailing outreach to keep existing customers coming back to your site. If you plan on selling items with low purchase frequency rates, you should focus on tactics that pull in new users to a site. Social media marketing, Google ads, and SEO tactics increase web traffic. Facebook usage is quite high in Sri Lanka, so this would be an ideal platform to advertise on. These are the methods you should rely on for selling items like vehicles.
If you want to capitalise on the current e-commerce trends for Sri Lanka, you should sell a high purchase frequency item like the ones mentioned above. Then you should build your customer base by employing customer engagement tactics to retain users.