Emerging technologies bringa new look to global e-Commerce landscape

Wilson ChowGlobal TMT Leader andChina/Hong Kong TMT Leader

PwC

e-Commerce is more than online retail

2

Increas

Online travel

Onlinemarketplace Online retail

Online advertisingInternet advertising promotes e-Commerce

Online deals

Overall Tech-enabled e-Commerce Ecosystem

PwC

B&R demographic is the engine for future growth

3

Asia-Pacific $1,057bn

N. America $644bn

Europe $505bn

Latin America $33bn

MENA $26bn

Others $8bn

$1,895bn $2,273bn $2,671bn

2014 2015 2016 (f)

Global B2C e-commerceturnover

+23.3%

+19.9%

+17.5%

Source: Global B2C E-commerce Report 2016 Colophon – 2015 data in USD.PwC and BMI (B&R countries include China) *

Global B2C e-Commerce turnover by region

5,563mn people areover the age of 15

>45%from age 15 to 45 inB&R countries*

Global$2,273

bn

2,520mnpeople use theInternet (45%)

1,436mnpeople aree-shoppers

(26%)

7% Estimated share ofonline goods intotal retail of goods

38%Services

62%Goods

PwC

Unlocking unique Belt & Road opportunity

4

developing national

65Open to all countries beyond the

developing national

developing national

developing nationalAlong the

economic corridors

6

Estimated to have an impact on thepopulation of about 4.4 billion

developing national

Of theglobal economy

1/3

It is an endeavour of unprecedented scale , involving 65 countrieson six economic corridors, and impacts a third of global economy

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From Silk Road trade to Belt & Road e-Commerce

“China’s cross border e-commerce market is

fragmented along the Belt

and Road countries.

There is no key playerwith more than 25% of the total market.

This represents excellentopportunities for small

and medium enterprises to become dominantin the e-Commerce markets of these countries”

Market share of main cross bordere-commerce players in China

Source: iiMedia Research, WalkthatChat

24.2%

20.3%

15.7%

12.5%

5.8%

5.3%

3.1%

13.1%

Kaola网易考拉海购

Tmall天猫

Vip.com唯品会

JD Worldwide京东全球购

yMatou洋码头

XiaHongShu小红书

Mia.com蜜芽

Others

PwC

77% of CEOs rank technological advances asthe most disruptive megatrend

6

New growth avenuesRealising e-Commerce opportunitywith new emerging technologies

PwC

Emerging technologies are impacting businessmodels and consumers’ behaviors, globally

7

Em

er

gin

gT

ec

hn

olo

gie

s

AI

AR

Blockchain

Drones

IoT

Robots

VR

3D Printing

Imp

ac

to

ne

-Co

mm

er

ce New Payment

Methods

Blockchain to securetransactions; AI to detect and

prevent fraud

New MobileEcosystem

Growth of internet advertising;AI enabled analytics; drones for

delivery; AR/VR shopping

New Business Models &Rise of Unicorns

Rise of unicorns; newbusiness models powered

by technology

PwC

Rise of Unicorns in e-Commerce market

13

17

2527

35

8

On-Demand Healthcare FinTech InternetSoftware

& Services

e-Commerce/Marketplace

Global Landscape - Top industries

Source: CB Insights' The Global Unicorn Club from 30th June, 2017 (Q2 data).

Examples:

China

USA

India

• Dianping.com

• Airbnb

• snapdeal

• flipkart

PwC

Blockchain Payment Gateway in e-Commerce

9

Source: Blockchain Payment Solutions, Future Financial Technology

Merchant TransactionChannels

Virtual Terminal E-commerce

m-Commerce More business formats

• Business Intelligence

• Loyalty programme

• Virtual to physical

Card ProcessorSmartcard Processor

• Bank AcquiringSystem (e.g. VISA,Master Card, PayPal,etc.)

• e-Wallet Operators(e.g. Alipay)

• Other serviceproviders

• Intelligent routing

• Merchant portal

• E2E security &tokenisation

• Crypto paymentpackage

• e-Wallet

• Micro-payment

• Multiple currencies

• Fraud management

BlockchainTechnology

High Speed&

Secured

Banks and FinancialService Providers

PwC

Internet advertising enables customeracquisition

10

Source: PwC Global E&M Outlook 2017-2021

$0

$50

$100

$150

$200

$250

$300

$350

2012 2013 2014 2015 2016 2017 2018 2019 2020 2021

Rev

enu

eU

S$

bn

GlobalGrowth by Top Revenue Contributing

Segments(CAGR 2016-21)

Internet advertising9.8%

$0

$10

$20

$30

$40

$50

$60

$70

$80

2012 2013 2014 2015 2016 2017 2018 2019 2020 2021

Rev

enu

eU

S$

bn

ChinaGrowth by Top Revenue Contributing

Segments(CAGR 2016-21)

Internet advertising12.6%

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Source: PwC Global E&M Outlook 2017-2021

Biometric

Financial

Social

Location

Access toconsumer data

unlocksnew

opportunities

ConsumerData

PersonalAssistants/

Chatbots

Mediapersonalization

AdvertisingTechnology

Security

Social media and Emerging technologies ase-Commerce enablers

PwC

e-Commerce growth drivers

12

Payments andtransactions

Deliveryexperience

Technologyadvancements

Convergence of onlineand offline channels

Customer experience

Digital infrastructure

Addressablemarkets

Customeracquisition

Operationalframework

Government support

Top 10Drivers

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Source: PwC Global E&M Outlook 2017-2021

Tencent: a successful and integrated strategy that createsan innovative, mobile ecosystem for e-Commerce

• Banking

• News

• Social media

• Music

• Text, voice, video calls

• Live chat

• Video games

• e-Commerce

PwC

Seize the opportunity!

PwC

Let’s talk

This content is for general information purposes only, and should not be used as a substitute for consultation with professional advisors.© 2017 PricewaterhouseCoopers Limited. All rights reserved. PwC refers to the Hong Kong member firm, and may sometimes refer to thePwC network. Each member firm is a separate legal entity. Please see www.pwc.com/structure for further details.

Wilson Chow

Global and China/Hong Kong

Telecommunications, Media & Technology Leader

Whatsapp: +852 6876 7701

WeChat: 138 231 67701

Email: wilson.wy.chow@cn.pwc.com

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