Note: This report includes forecasting data that is based on baseline historical data.
Executive summary
In 2021, e-commerce was the largest non-store distribution channel in the Philippines, totalling US$5.8 billion, 89.9% of non-store retail sales. E-commerce had been the second largest category of non-store retailing in 2017, and the 2021 valuation of e-commerce comes after growing at a compound annual growth rate (CAGR) of 53.5% from 2017-2021. Sales of e-commerce packaged food increased at a CAGR of 403.2% from 2017 to 2021, rising from US$0.7 million in 2017 to US$448.7 million in 2021. A key trend stimulated by the pandemic has been the normalisation of using e-commerce to shop for essential goods, such as packaged food.
Social media is important in the Philippine e-commerce scene, and the most popular social media platform in the country is Facebook. Facebook Marketplace plays a prominent in role in the country's e-commerce scene.
Within the foodservice industry, e-commerce sales grew from US$56.6 million in 2017 to US$906.4 million in 2021, a CAGR of 100.0%. In 2021, mobile e-commerce purchases totalled US$4.3 billion, accounting for 73.4% of the e-commerce market.
In 2021, there were 73.4 million internet users in the Philippines, and 73.0% of Filipinos used the internet. The number of internet users is expected to grow at a CAGR of 4.2% from 2022 to 2026, reaching 91.0 million in 2026. In 2021, 51.3% of households had access to the internet, while 38.3% had access to broadband internet. Internet and broadband internet are expected to reach 61.8% and 51.1%, respectively, by 2026. In 2021, the percent of households that possessed a a digital device were as follows: mobile telephone (92.4%), smartphone (71.5%), personal computer (26.7%), laptop (19.3%), and tablet (17.3%).
In the years leading up to the pandemic, the Philippine economy had undergoing fast growth, however 2020 saw gross domestic product (GDP) fall by 8.1%. The economy is expected to have fully recovered by the end of 2022, and strong growth is expected at a CAGR of 8.8% from 2022 to 2040. The population is split relatively evenly between urban and rural inhabitants.
Socioeconomic profile
Country economic profile
The Philippine economy has a history of strong growth, which in 2020 turned into the sharpest economic decline on record. Total GDP was US$307.2 billion in 2016, and reached US$396.2 billion in 2019, growing at a CAGR of 8.85%, and fell to US$364.2 billion in 2020, falling 8.1%. The economy is expected to recover to pre-pandemic size in 2022 and grow at a CAGR of 8.8% from 2022-2040, reaching US$2.0 trillion in 2040. In 2019, the Philippines had a trade balance of US$-40.7 billion, a trade deficit equal to 10.8% of GDP. The deficit contracted to US$24.6 billion in 2020 (6.8% of GDP) and expanded to US$43.1 billion in 2021 (11.0% of GDP).
Gross value added in the Philippine economy in 2021 was US$376.3 million. Of that, wholesale and retail trade contributed US$100.3 million (26.7% of the total), mining quarrying and manufacturing contributed US$86.6 million (23.0%), financial intermediation contributed US$67.6 million (18.0%), public administration contributed US$51.4 million (13.7%), agriculture hunting forestry and fishing contributed US$42.9 million (11.4%), and construction contributed US$27.4 million (7.3%).
Demographics
The total population of the Philippines in 2021 was 111.0 million, and is expected to reach 118.2 million in 2026, growing at a CAGR of 1.3% over the historic period. In 2021, the population was split almost evenly on gender lines, with 50.2% of the population male and 49.8% female. The median age of the population was 26.0 years, expected to rise to 27.5 years by 2026. In 2021, 53.3% of the population lived in urban areas, while 46.7% lived in rural areas. The rural population (in absolute terms) is expected to grow at a CAGR of 2.2% from 2022-2026, while the rural population is expected to grow slowly at a CAGR of 0.2%. In 2026, the population is expected to be 55.8% urban and 44.2% rural.
In 2021, there were 26.3 million households in the Philippines, of which 53.7% were couples with children, 11.1% were couples without children, 9.1% were single person, 8.3% were single parent families, and 14.2% were other mixed households. The average household size was 4.2 persons, and 54.6% of households were urban, while 45.4% were rural. Houses were by far the most common type of dwelling, with 97.0% of households falling into this category, while 2.8% were apartments and 0.1% were another type of dwelling. Although the Philippines' fertility rate is declining, having large families is still relatively common in the country. The most common number of children per household was none (37.8%) followed by households with one child (29.1%), followed by households with four or more children (15.7%).
Consumer income and expenditures
2020 saw median disposable income per household fall by −6.1%, dropping to US$7,910.0. Household median disposable income recovered by 6.5% in 2021. Although in 2021 it remained slightly below 2019 levels, median household disposable income is expected to exceed 2019 levels in 2022, reaching US$9,111.3. Median disposable income per household is expected to reach US$12,079.2 in 2026, growing at a CAGR of 7.3% from 2022-2026. In 2021, 28.2% of households were part of the middle class.
In 2021, total consumer expenditure in the Philippines was US$287.2 million (73.0% of GDP), which is above 2019 levels. Consumer expenditure is expected to reach US$451.4 million in 2026, growing at a CAGR of 9.5% from 2021-2026. In 2021, consumer expenditure on food and non-alcoholic beverages was US$123.0 million (42.8% of total consumer expenditure) and is expected to reach US$192.2 million in 2026 (CAGR of 9.3%). Consumer expenditure on alcoholic beverages and tobacco products was US$4.1 million in 2021 (1.4% of total consumer expenditure) and is expected to reach US$6.4 million in 2026 (CAGR of 9.2%).
The digital consumer in the Philippines
Prior to 2020, the Philippine e-commerce sector was undergoing rapid expansion. The sector in the Philippines saw accelerated growth in 2020, during which the Philippines imposed lengthy lockdowns that were among the most restrictive in the world. Foodservice and retailing saw particularly large spikes in e-commerce sales, as restaurants pivoted to delivering food through third party platforms. Small and medium sized enterprises have been increasingly offering digital services. Third party delivery services, such as GrabFood, Food Panda, and LalaFood, all saw significant expansion in 2020, while new delivery services entered the market. Meanwhile, consumer aversion to visiting supermarkets drove significant growth in online grocery retailing, as delivery services begin offering grocery delivery options. Prior to the pandemic, e-commerce was primarily used for casual shopping, and the pandemic stimulated rapid growth of staple food categories of e-commerce.
The Philippine e-commerce sector has been seeking to replicate the experience of in-person shopping, where customers can be assisted. Many Filipino consumers are accustomed to being assisted by a store employee, and the sector has been experimenting with allowing consumers to use messaging apps to seek assistance. It is expected that many Filipino e-commerce players will opt to combine e-commerce with physical outlets in an omni-channel strategy.
Social media is of particular importance to the Philippine e-commerce sector, and e-commerce marketing often takes place on a social media platform. Many Filipinos do not see a distinction between e-commerce and social media. Facebook is the largest social media outlet in the country, and Facebook Marketplace has seen significantly increased traffic since the beginning of the pandemic and is increasingly being used to source food and groceries.
A significant barrier to the growth of e-commerce in the Philippines is lack of access to the internet. In 2020, less than half of households had access to the internet. The potential also exists that the country may increase enforcement of tax policies as the sector's prominence grows. In addition, much of the country's population is unbanked, and there exists uncertainty about the country's economic future. Mobile wallets are quickly gaining popularity in the Philippines, but cash remains popular. The Philippines' digital infrastructure continues to lag behind peer nations. However, telecommunication companies are investing in infrastructure to expand internet use. Internet use is consistently rising, and the base of offline consumers represents large potential for future growth.
E-commerce market sizes: retail sales
In 2021, store-based retailing accounted for 86.6% (US$53.6 billion) of retail sales, while non-store retailing accounted for the remaining 13.4% (US$ 7.2 billion). E-commerce was valued at US$5.8 billion, marking up 89.9% of non-store retailing 10.9% of all retail sales. Sales of e-commerce grew at a CAGR of 53.5% from 2017-2021 and are expected to grow at a CAGR of 6.9% from 2022-2026, reaching US$9.9 billion by 2026. Growth in e-commerce is expected to slow around 2024, with growth from 2024-2026 occurring at a CAGR of 2.8%. In 2026, e-commerce is expected to make up 14.4% of all retail sales.
| Category | 2017 | 2021 | CAGR* (%) 2017-2021 | 2022 | 2026 | CAGR* (%) 2022-2026 |
|---|---|---|---|---|---|---|
| Total - retailing | 54,850.2 | 53,600.6 | −0.6 | 57,727.7 | 68,706.3 | 4.4 |
| Store-based retailing | 52,430.2 | 46,398.1 | −3.0 | 48,732.3 | 57,049.5 | 4.0 |
| Non-store retailing | 2,420.0 | 7,202.5 | 31.3 | 8,995.4 | 11,656.8 | 6.7 |
| E-commerce | 1,048.4 | 5,827.8 | 53.5 | 7,573.3 | 9,904.0 | 6.9 |
| Direct selling | 1,345.3 | 1,370.8 | 0.5 | 1,418.3 | 1,748.5 | 5.4 |
| Home shopping | 24.8 | 2.9 | −41.5 | 2.8 | 2.8 | 0.0 |
| Vending | 1.5 | 0.9 | −12.0 | 1.0 | 1.4 | 8.8 |
|
Source: Euromonitor, 2022 *CAGR: Compound Annual Growth Rate |
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In 2021, domestic e-commerce was valued at US$3.9 billion, making up 67.3% of all e-commerce in the country, while foreign e-commerce made up the remaining US$1.9 billion (32.7%). Domestic e-commerce is expected to grow faster than foreign e-commerce from 2022-2026, at a CAGR of 7.9%, and by 2026 is expected to be valued at US$7.0 billion (70.4% of all e-commerce). Foreign e-commerce is expected to grow at a CAGR of 4.9% from 2022-2026, making up 29.6% of the market in 2026.
In 2021, mobile e-commerce was valued at US$4.3 billion, making up 73.4% of the market. Mobile e-commerce is popular due to relatively high rates of mobile ownership in the Philippines. In 2020, only 25% of households had personal computers, while 92% had mobile devices. Mobile e-commerce is expected to grow faster than total e-commerce, growing at a CAGR of 8.8% from 2022-2026. By 2026, mobile e-commerce is expected to reach US$8.0 billion, making up 80.3% of the e-commerce market.
| Category | 2017 | 2021 | CAGR* (%) 2017-2021 | 2022 | 2026 | CAGR* (%) 2022-2026 |
|---|---|---|---|---|---|---|
| Total - cross-border e-commerce | 1,048.4 | 5,827.8 | 53.5 | 7,573.3 | 9,904.0 | 6.9 |
| Domestic e-commerce | 624.3 | 3,923.7 | 58.3 | 5,149.9 | 6,968.3 | 7.9 |
| Foreign e-commerce | 424.1 | 1,904.1 | 45.6 | 2,423.4 | 2,935.8 | 4.9 |
| Total - mobile e-commerce | 608.1 | 4,280.0 | 62.9 | 5,673.1 | 7,951.9 | 8.8 |
|
Source: Euromonitor, 2022 *CAGR: Compound Annual Growth Rate |
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Total e-commerce sales in the Philippines grew at a CAGR of 53.5% from 2017 to 2021, rising from US$1.0 billion to US$5.8 billion. The sector which saw the most explosive growth was food and drink e-commerce, which grew at a CAGR of 325.1% from 2017 to 2021, growing from US$2.3 million to US$751.0 million. Food and drink e-commerce went from making up 0.2% of all e-commerce sales in 2017 to 12.9% of all sales in 2021. The sector saw 301.7% year-over-year growth in 2020 and 129.7% year-over year growth in 2021. Although the e-commerce sector in the Philippines is expected to see annual growth slow to the low single digits by 2024 to 2026, growth in the food and drink sector is expected to remain relatively strong. Food and drink is expected to grow at a CAGR of 12.9% from 2022 to 2026, and more specifically, at a CAGR of 8.0% from 2024 to 2026. In 2026, total food and drink e-commerce sales are expected to be valued at US$ 1.7 billion and will make up 17.6% of the market.
The largest category of e-commerce in 2021 was apparel and footwear, followed by consumer electronics, and then food and drink. In 2026, media products will be the largest category, followed by apparel and footwear, while food and drink will remain third. Growth in e-commerce from 2022 to 2026 will be led by media products, while the slowdown in overall growth will be largely the result of the decline in the other category of e-commerce. From 2024 to 2026, sales of other e-commerce are expected to fall from US$2.0 billion to US$0.4 billion.
| Category | 2017 | 2021 | CAGR* (%) 2017-2021 | 2022 | 2026 | CAGR* (%) 2022-2026 |
|---|---|---|---|---|---|---|
| Total - e-commerce by product | 1,048.4 | 5,827.8 | 53.5 | 7,573.3 | 9,904.0 | 6.9 |
| Apparel and Footwear E-Commerce | 297.9 | 1,146.8 | 40.1 | 1,499.7 | 2,563.7 | 14.3 |
| Consumer Electronics E-Commerce | 182.7 | 772.8 | 43.4 | 845.3 | 1,224.9 | 9.7 |
| Food and Drink E-Commerce | 2.3 | 751.0 | 325.1 | 1,074.5 | 1,743.8 | 12.9 |
| Media Products E-Commerce | 223.8 | 736.4 | 34.7 | 1,010.0 | 2,841.2 | 29.5 |
| Homewares and Home Furnishings E-Commerce | 29.8 | 161.9 | 52.7 | 181.8 | 272.0 | 10.6 |
| Beauty and Personal Care E-Commerce | 17.4 | 158.3 | 73.7 | 193.5 | 354.2 | 16.3 |
| Personal Accessories and Eyewear E-Commerce | 30.4 | 88.7 | 30.7 | 105.0 | 200.9 | 17.6 |
| Consumer Appliances E-Commerce | 13.8 | 66.8 | 48.3 | 83.2 | 142.6 | 14.4 |
| Traditional Toys and Games E-Commerce | 0.5 | 19.6 | 150.2 | 21.6 | 49.5 | 23.0 |
| Consumer Health E-Commerce | 1.6 | 18.1 | 83.4 | 21.1 | 41.8 | 18.6 |
| Home Care E-Commerce | 4.8 | 14.3 | 31.4 | 16.6 | 34.3 | 19.9 |
| Pet Care E-Commerce | 4.0 | 9.9 | 25.4 | 11.1 | 16.3 | 10.1 |
| Home Improvement and Gardening E-Commerce | 0.8 | 1.3 | 12.9 | 1.4 | 1.9 | 7.9 |
| Video Games Hardware E-Commerce | 0.6 | 1.3 | 21.3 | 1.4 | 2.2 | 12.0 |
| Other E-Commerce | 238.0 | 1,880.5 | 67.7 | 2,507.1 | 414.7 | −36.2 |
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Source: Euromonitor, 2022 *CAGR: Compound Annual Growth Rate |
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From 2017 to 2021, growth in e-commerce sales of packaged foods was explosive. Growth occurred at a CAGR of 403.2% from 2017 to 2021, and data did not exist yet for most categories in 2017, due to the negligible presence of e-commerce. In 2017, store-based sales of packaged food accounted for 100.0% of many of the categories of packaged food. In 2021, total e-commerce sales of packaged food were US$448.7 million, 92.3% of non-store based packaged food and 2.8% of all packaged food. The largest category of e-commerce packaged food was dairy, which had US$105.1 million in sales in 2021. Dairy was followed by processed meat, seafood, and alternatives to meat (US$60.0 million), savoury snacks (US$55.5 million), edible oils (US$51.2 million), sauces, dressings, and condiments (US$ 39.5 million) and baby food (US$36.3 million). In 2021 97.0% of retail sales of packaged food were store based, while 3.0% were non-store based.
The category of packaged food with the greatest proportion of sales through e-commerce was baby food, which in 2021 saw 4.0% of sales through e-commerce. The next largest was edible oils, with 3.8% of sales, followed by dairy, with 3.7% of sales, and sauces dressing and condiments, with 3.5% of sales. The category which saw the fastest growth in e-commerce sales from 2019 to 2021 was pasta and noodles, which saw retail sales grow from US$0.9 million in 2019 to US$30.0 million in 2021 (CAGR 477.4%), with e-commerce sales of rice pasta and noodles rising from 0.1% of all rice pasta and noodles sales to 2.1% (CAGR 358.3%).
| Category | 2017 | 2018 | 2019 | 2020 | 2021 | CAGR* (%) 2017-2021 | CAGR* (%) 2019-2021 | CAGR* (%) 2020-2021 |
|---|---|---|---|---|---|---|---|---|
| Grand total - packaged food | 12,362.6 | 13,210.5 | 14,099.7 | 15,335.9 | 16,242.1 | 7.1 | ||
| Total - store-based packaged food | 12,322.9 | 13,167.0 | 13,982.0 | 15,005.6 | 15,756.1 | 6.3 | ||
| Total - non-store packaged food | 39.7 | 43.5 | 117.7 | 330.3 | 486.0 | 87.1 | ||
| Dairy | 7.7 | 67.0 | 105.1 | 269.5 | ||||
| Processed Meat, Seafood and Alternatives to Meat | 12.2 | 39.3 | 60.0 | 121.8 | ||||
| Savoury Snacks | 14.9 | 35.7 | 55.5 | 93.0 | ||||
| Edible Oils | 9.9 | 33.0 | 51.2 | 127.4 | ||||
| Sauces, Dressings and Condiments | 7.6 | 25.6 | 39.5 | 128.0 | ||||
| Baby Food | 7.6 | 23.3 | 36.3 | 118.5 | ||||
| Rice, Pasta and Noodles | 0.9 | 19.7 | 30.0 | 477.4 | ||||
| Baked Goods | 15.9 | 24.6 | 54.7 (2020-2021) | |||||
| Sweet Biscuits, Snack Bars and Fruit Snacks | 0.0 | 0.0 | 6.2 | 10.9 | 15.3 | 57.1 | ||
| Confectionery | 0.7 | 0.7 | 3.7 | 10.3 | 14.8 | 114.4 (2017-2021) | ||
| Processed Fruit and Vegetables | 2.9 | 4.4 | 51.7 | |||||
| Breakfast Cereals | 2.0 | 3.1 | 55.0 | |||||
| Ready Meals | 1.8 | 2.8 | 55.6 | |||||
| Sweet Spreads | 1.6 | 2.5 | 56.3 | |||||
| Soup | 1.3 | 2.0 | 53.8 | |||||
| Ice Cream and Frozen Desserts | 0.5 | 1.6 | 220.0 | |||||
| Total - e-commerce packaged food | 0.7 | 0.7 | 70.7 | 290.8 | 448.7 | 403.2 (2017-2021) | ||
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Source: Euromonitor, 2022 *CAGR: Compound Annual Growth Rate |
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| Category | Outlet type | 2017 | 2018 | 2019 | 2020 | 2021 | CAGR* (%) 2019-2021 | CAGR* (%) 2020-2021 |
|---|---|---|---|---|---|---|---|---|
| Total - store-based packaged food | 99.7 | 99.7 | 99.2 | 97.8 | 97.0 | −0.7 (2017-2021) | ||
| Total - non-store packaged food | 0.3 | 0.3 | 0.8 | 2.2 | 3.0 | 77.8 (2017-2021) | ||
| Dairy | Store-based | 98.1 | 98.1 | 97.7 | 96.0 | 95.0 | −1.4 | |
| E-commerce | 0.3 | 2.6 | 3.7 | 251.2 | ||||
| Processed Meat, Seafood, and Alternatives to Meat | Store-based | 100.0 | 100.0 | 99.5 | 98.5 | 97.9 | −0.8 | |
| E-commerce | 0.5 | 1.5 | 2.0 | 100.0 | ||||
| Savoury Snacks | Store-based | 100.0 | 100.0 | 99.1 | 98.0 | 97.0 | −1.1 | |
| E-commerce | 0.9 | 2.0 | 3.0 | 82.6 | ||||
| Edible Oils | Store-based | 100.0 | 100.0 | 99.2 | 97.5 | 96.2 | −1.5 | |
| E-commerce | 0.8 | 2.5 | 3.8 | 117.9 | ||||
| Sauces, Dressings, and Condiments | Store-based | 100.0 | 100.0 | 99.2 | 97.6 | 96.5 | −1.4 | |
| E-commerce | 0.8 | 2.4 | 3.5 | 109.2 | ||||
| Baby Food | Store-based | 100.0 | 100.0 | 99.1 | 97.4 | 96.0 | −1.6 | |
| E-commerce | 0.9 | 2.6 | 4.0 | 110.8 | ||||
| Rice, Pasta, and Noodles | Store-based | 100.0 | 100.0 | 99.9 | 98.5 | 97.9 | −1.0 | |
| E-commerce | 0.1 | 1.5 | 2.1 | 358.3 | ||||
| Baked Goods | Store-based | 100.0 | 100.0 | 100.0 | 98.6 | 97.9 | −0.7 (2020-2021) | |
| E-commerce | 1.4 | 2.1 | 50.0 (2020-2021) | |||||
| Sweet Biscuits, Snack Bars, and Fruit Snacks | Store-based | 100.0 | 100.0 | 99.1 | 98.6 | 98.1 | −0.5 | |
| E-commerce | 0.0 | 0.0 | 0.9 | 1.4 | 1.9 | 45.3 | ||
| Confectionary | Store-based | 99.9 | 99.9 | 99.6 | 98.7 | 98.1 | −0.5 (2017-2021) | |
| E-commerce | 0.1 | 0.1 | 0.4 | 1.3 | 1.9 | 108.8 (2017-2021) | ||
| Processed Fruit and Vegetables | Store-based | 100.0 | 100.0 | 100.0 | 99.0 | 98.6 | −0.4 | |
| E-commerce | 1.0 | 1.4 | 40.0 | |||||
| Breakfast Cereals | Store-based | 100.0 | 100.0 | 100.0 | 98.5 | 97.9 | −0.6 | |
| E-commerce | 1.5 | 2.0 | 33.3 | |||||
| Ready Meals | Store-based | 100.0 | 100.0 | 100.0 | 97.7 | 96.7 | −1.0 | |
| E-commerce | 2.3 | 3.3 | 43.5 | |||||
| Sweet Spreads | Store-based | 100.0 | 100.0 | 100.0 | 97.8 | 96.8 | −1.0 | |
| E-commerce | 2.2 | 3.2 | 45.5 | |||||
| Soup | Store-based | 100.0 | 100.0 | 100.0 | 98.0 | 97.1 | −0.9 | |
| E-commerce | 2.0 | 2.9 | 45.0 | |||||
| Ice Cream and Frozen Deserts | Store-based | 100.0 | 100.0 | 100.0 | 99.9 | 99.6 | −0.3 | |
| E-commerce | 0.1 | 0.4 | 300.0 | |||||
| Total - e-commerce packaged food | 0.0 | 0.0 | 0.5 | 1.9 | 2.8 | 136.6 | ||
|
Source: Euromonitor, 2022 *CAGR: Compound Annual Growth Rate |
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In 2021, retailing was the industry with the largest e-commerce sales (US$ 3.0 billion), followed by transport (US$1.1 billion) and foodservice (US$0.9 billion). In 2019, lodging had been the second largest industry, with US$0.8 billon in e-commerce sales, however in 2020 retail sales fell to US$0.3 billion, and as of 2021, they had not recovered, and was the sixth largest industry, with sales below 2017 levels.
From 2017 to 2021, foodservice was the industry which saw the fastest growth. In 2017, foodservice e-commerce sales were US$56.6 million (2.4% of e-commerce goods and services), and grew at a CAGR of 100.0% from 2017 to 2021, reaching US$906.4 million in 2021 (13.4% of e-commerce goods and services). Year-over-year growth from 2019-2020 in foodservice e-commerce was 426.7%, as the pandemic stimulated explosive growth. From 2022 to 2026, foodservice e-commerce is expected to grow at a CAGR of 8.2%, which is behind the total goods & services e-commerce CAGR of 14.6%. In 2026, foodservice e-commerce is expected to be valued at US$1.7 billion, at which point it will make up 9.6% of the goods & services e-commerce market.
| Category | 2017 | 2021 | CAGR* (%) 2017-2021 | 2022 | 2026 | CAGR* (%) 2022-2026 |
|---|---|---|---|---|---|---|
| Total - e-commerce (Goods and services) | 2,329.9 | 6,760.3 | 30.5 | 10,211.6 | 17,609.3 | 14.6 |
| Retailing | 263.8 | 3,010.4 | 83.8 | 4,670.4 | 7,991.7 | 14.4 |
| Transport | 840.5 | 1,095.4 | 6.8 | 1,815.5 | 3,669.7 | 19.2 |
| Foodservice | 56.6 | 906.4 | 100.0 | 1,233.5 | 1,691.8 | 8.2 |
| Digital streaming services | 292.5 | 676.1 | 23.3 | 837.0 | 1,564.0 | 16.9 |
| Bill payments | 233.0 | 496.7 | 20.8 | 570.1 | 720.5 | 6.0 |
| Lodging | 579.3 | 492.0 | −4.0 | 973.9 | 1,783.9 | 16.3 |
| Ticketed attractions and entertainment | 61.5 | 69.3 | 3.0 | 91.9 | 161.2 | 15.1 |
| Other E-commerce (Goods and services) | 2.7 | 14.0 | 50.9 | 19.3 | 26.5 | 8.2 |
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Source: Euromonitor, 2022 *CAGR: Compound Annual Growth Rate |
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| Device type | 2016 | 2020 | CAGR* (%) 2016-2020 | 2021 | 2025 | CAGR* (%) 2021-2025 |
|---|---|---|---|---|---|---|
| Total - foodservice e-commerce online | 24.5 | 677.3 | 129.3 | 906.4 | 1,691.8 | 16.9 |
| Mobile - total value | 132.1 | 806.4 | 57.2 | 1,109.8 | 1,413.7 | 6.2 |
| Mobile - total online value | 10.2 | 381.2 | 147.3 | 519.3 | 1,033.0 | 18.8 |
| PC - total value | 160.9 | 631.9 | 40.8 | 834.7 | 898.8 | 1.9 |
| PC - total online value | 13.9 | 287.0 | 113.2 | 375.5 | 640.5 | 14.3 |
| Tablet - total value | 4.8 | 20.0 | 42.9 | 26.1 | 25.8 | −0.3 |
| Tablet - total online value | 0.4 | 9.0 | 117.8 | 11.7 | 18.4 | 12.0 |
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Source: Euromonitor, 2022 *CAGR: Compound Annual Growth Rate |
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Competitive e-commerce landscape
In 2021, e-commerce sales were led by Sea Ltd, which enjoyed a 24.4% share of the Philippine e-commerce market and sold all its products through third party merchants. Alibaba Holding Ltd was next, with a 20.1% share of the market, of which 86.6% were sold through third party merchants (17.4% of the market). Rocket Internet controlled 4.7% of the market in 2021, and 83.0% of its sales were through third party merchants (3.9% of the market). From 2017-2021 Amazon.com Inc, Ayala Corp, and Ebay Inc all saw their shares of the market decline significantly, to 0.2%, 0.1%, and 0.1% of the market respectively. Despite a declining market share, all three of these corporations did see modest increases in actual sales from 2017-2021.
From 2017-2021, the Philippine e-commerce market has become increasingly consolidated, as the share of e-commerce sales by corporations not in the top six fell from 72.4% in 2017 to 50.4% in in 2021. The trend towards consolidation is almost entirely the result of the growth of Sea Ltd, which saw its market share grow from 4.6% in 2017 to 24.4% in 2021 (CAGR of 51.8%). Actual sales of e-commerce by Sea Ltd grew by a CAGR of 132.7% from 2017 to 2021.
| Company | 2017 | 2018 | 2019 | 2020 | 2021 | CAGR* (%) 2017-2021 |
|---|---|---|---|---|---|---|
| Sea Ltd | 4.6 | 8.7 | 11.1 | 15.5 | 24.4 | 51.8 |
| Alibaba Group Holding Ltd | 16.3 | 15.0 | 13.7 | 15.8 | 20.1 | 5.4 |
| Rocket Internet AG | 4.9 | 4.6 | 4.1 | 4.2 | 4.7 | −1.0 |
| Amazon.com Inc | 0.9 | 0.6 | 0.4 | 0.3 | 0.2 | −31.3 |
| Ayala Corp | 0.6 | 0.4 | 0.3 | 0.2 | 0.1 | −36.1 |
| eBay Inc | 0.3 | 0.2 | 0.1 | 0.1 | 0.1 | −24.0 |
| Other online retailers | 72.4 | 70.5 | 70.3 | 64.0 | 50.4 | −8.7 |
| Total - top 6 online retailers | 27.6 | 29.5 | 29.7 | 36.1 | 49.6 | 15.8 |
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Source: Euromonitor, 2022 *CAGR: Compound Annual Growth Rate |
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Digital landscape in the Philippines
In 2021, there were 73.4 million total internet users in the Philippines, an increase from 56.4 million in 2017 (CAGR 6.8%). 63.5% of the population accessed the internet daily (85.6% of internet users), while 69.1% of the population accessed the internet at leas once a week (93.8% of internet users). 9.5% of the population reported using the internet for online banking, 8.7% for selling goods or services, and 57.5% reported using the internet for telephoning or video calls. 41.7% of the population reported accessing the internet via mobile phone (56.6% of internet users), while 19.7% reported accessing the internet through a laptop, notebook, or tablet (26.7% of internet users).
The Philippines had a total of 148.7 million total internet subscribers in 2021, along with 6.8 million Voice over IP (VoIP) subscribers. Wireless broadband subscribers made up 88.9% of Philippines internet subscribers, fixed narrowband subscribers made up 7.8% of subscribers, and fixed broadband subscribers accounted for the remaining 3.3%. The most popular social media site in the Philippines in 2021 was Facebook, with 91.3 million users. YouTube had 41.2 million users, Instagram 12.9 million users, and twitter 10.8 million users. Facebook Messenger was the most popular messaging app, with 72.7 million users, followed by Viber with 58.3 million users. In a distant third was WeChat with 8.5 million users, followed by Whatsapp with 8.4 million users.
In 2021, 96.2% of the population was covered by a mobile cell network, down from 99.0% in 2017. 96.2% of the population was covered by at least a 3G network, up from 93.0% in 2017, and 95.6% of the population was covered by an LTE/WiMax network or better, up from 80.0% in 2017. 3G or higher coverage is expected to reach 99.3% by 2026, while LTE/WiMax coverage is expected to reach 97.9%. In 2021 The average usage time for mobile telephone calls per mobile subscriber was 1,208.9 minutes at an average price per 1-minute call of PHP$7.0 (SMS text: PHP$1.0).
| Category (unit) | 2017 | 2021 | CAGR* (%) 2017-2021 | 2022 | 2026 | CAGR* (%) 2022-2026 |
|---|---|---|---|---|---|---|
| Internet users ('000) | 56,396.6 | 73,399.9 | 6.8 | 77,264.1 | 90,952.9 | 4.2 |
| Population using the internet (%) | 60.1 | 73.0 | 5.0 | 75.8 | 84.7 | 2.8 |
| Households with access to internet (%) | 42.7 | 51.3 | 4.7 | 53.5 | 61.8 | 3.7 |
| Households with access to broadband (%) | 28.6 | 38.3 | 7.6 | 40.8 | 51.1 | 5.8 |
| Frequency of internet access: daily (%) | 44.6 | 62.5 | 8.8 | 66.4 | 79.0 | 4.4 |
| Internet use: internet banking (%) | 6.5 | 9.5 | 10.0 | |||
| Internet use: selling goods or services (%) | 5.4 | 8.7 | 12.7 | |||
| Internet use: telephoning/video calls (%) | 44.3 | 57.5 | 6.7 | |||
| Access internet: via laptop, notebook, tablet (%) | 18.6 | 19.7 | 1.4 | |||
| Access internet: via mobile phone (%) | 32.6 | 41.7 | 6.3 | |||
| Internet subscribers ('000) | 97,808.9 | 148,685.8 | 11.0 | 158,935.1 | 189,599.0 | 4.5 |
| Fixed narrowband subscribers ('000) | 11,845.2 | 11,538.3 | −0.7 | 10,999.2 | 8,415.1 | −6.5 |
| Fixed broadband subscribers ('000) | 3,399.3 | 4,927.8 | 9.7 | 5,291.1 | 6,534.0 | 5.4 |
| Wireless broadband subscribers ('000) | 82,564.4 | 132,219.7 | 12.5 | 142,644.8 | 174,650.0 | 5.2 |
| VoIP subscribers ('000) | 5,127.8 | 5,764.4 | 3.0 | |||
| Mobile telephone subscribers ('000) | 119,971.9 | 185,006.1 | 11.4 | 192,625.8 | 218,224.7 | 3.2 |
| Population covered by mobile-cell network (%) | 99.0 | 96.2 | −0.7 | 97.1 | 99.3 | 0.6 |
| Population covered by ≥3G mobile network (%) | 93.0 | 96.2 | 0.8 | 97.1 | 99.3 | 0.6 |
| Population covered by ≥LTE/WiMax network (%) | 80.0 | 95.6 | 4.6 | 96.2 | 97.9 | 0.4 |
|
Source: Euromonitor, 2022 *CAGR: Compound Annual Growth Rate |
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| Leading social media sites / messaging apps (unit) | 2016 | 2020 | CAGR* (%) 2016-2020 | 2021 | 2025 | CAGR* (%) 2021-2025 |
|---|---|---|---|---|---|---|
| 1. Facebook ('000 persons) | 55,768.0 | 91,300.0 | 13.1 | |||
| 2. YouTube ('000 persons) | 28,445.0 | 41,213.0 | 9.7 | |||
| 3. Instagram ('000 persons) | 11,963.0 | 12,934.0 | 2.0 | |||
| 4. Twitter ('000 persons) | 6,875.0 | 10,888.0 | 12.2 | |||
| 1. Facebook Messenger ('000 persons) | 20,169.0 | 72,700.0 | 37.8 | |||
| 2. Viber ('000 persons) | 25,000.0 | 58,279.0 | 23.6 | |||
| 3. WeChat ('000 persons) | 6,673.0 | 8,489.0 | 6.2 | |||
| 4. Whatsapp ('000 persons) | 5,042.0 | 8,444.0 | 13.8 | |||
|
Source: Euromonitor, 2022 *CAGR: Compound Annual Growth Rate |
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In 2021, 51.3% of Filipino households had access to the internet, which was highest in the National Capital region, and the regions of Calabarzon, Central Luzon, and Central Visayas. The National Capital Region, which includes the urbanized Manilla Metropolitan Area, had the highest rates of internet access, with 61.1% of households. This is up from 54.2% in 2017 (CAGR of 3.0% 2017 to 2021), and is expected to reach 69.4% by 2026 (2.5% CAGR 2022-2026). The next highest regions were Calabarzon and Central Luzon, the two regions that directly border the National Capital Region. 52.9% of Calabarzon households had access to the internet, while 51.5% had access in Central Luzon. Central Visayas, despite having the fourth highest rates of internet access among the country's seventeen regions, had ineternet access rates slightly below the national average. The four regions with the lowest rates of internet access were Cagayan Valley, Mimaropa, Soccsksargen, and the Autonomous Region in Muslim Mindanao. The Autonomous Region in Muslim Mindanao had 46.7% of households with access to the internet in 2021, expected to rise to 58.1% in 2026, growing at a CAGR of 4.4% from 2022 to 2026.
With respect to broadband internet access, 38.3% of Filipino households had access to broadband in 2021. The top four regions in the country were once again the National Capital Region, Calabarzon, Central Luzon, and Central Visayas, in that order. The National Capital Region had 43.3% of households with access to broadband, expected to rise to 55.1% in 2026 (CAGR of 4.8% from 2022 to 2026). Central Visayas, despite having the fourth highest broadband access rates in the country, had rates that were below the national average. The regions with the lowest broadband internet access were Caraga, Mimaropa, Soccksargen, and the Autonomous Region in Muslim Mindanao. 35.9% of households in the Autonomous region of Muslim Mindanao had access to broadband internet, expected to reach 49.2% in 2026 (CAGR of 6.3%).
Internet access was highest among the following demographics (% of households) other blended families (61.6%) and couples with children (55.7%), those aged 30-39 (61.8%) and renters (77.3%).
| Region (unit) | 2017 | 2021 | CAGR* (%) 2017-2021 | 2022 | 2026 | CAGR* (%) 2022-2026 |
|---|---|---|---|---|---|---|
| Internet users ('000) | 56,396.6 | 73,399.9 | 6.8 | 77,264.1 | 90,952.9 | 4.2 |
| Households with access to internet (%) | 42.7 | 51.3 | 4.7 | 53.5 | 61.8 | 3.7 |
| Top 4 regions: access to internet | ||||||
| National Capital | 54.2 | 61.1 | 3.0 | 62.8 | 69.4 | 2.5 |
| Calabarzon | 44.5 | 52.9 | 4.4 | 54.9 | 62.9 | 3.5 |
| Central Luzon | 42.9 | 51.5 | 4.7 | 53.6 | 61.9 | 3.7 |
| Central Visayas | 42.0 | 50.7 | 4.8 | 52.9 | 61.3 | 3.8 |
| Lowest 4 regions: access to internet | ||||||
| Cagayan Valley | 38.7 | 48.0 | 5.5 | 50.2 | 59.1 | 4.2 |
| Mimaropa | 38.5 | 47.8 | 5.6 | 50.1 | 58.9 | 4.1 |
| Soccsksargen | 38.3 | 47.6 | 5.6 | 49.9 | 58.8 | 4.2 |
| Autonomous Region in Muslim Mindanao | 37.2 | 46.7 | 5.9 | 49.0 | 58.1 | 4.4 |
| Households with access to broadband (%) | 28.6 | 38.3 | 7.6 | 40.8 | 51.1 | 5.8 |
| Top 4 regions: access to broadband | ||||||
| National Capital | 34.4 | 43.3 | 5.9 | 45.6 | 55.1 | 4.8 |
| Calabarzon | 29.5 | 39.1 | 7.3 | 41.6 | 51.8 | 5.6 |
| Central Luzon | 28.7 | 38.4 | 7.6 | 40.9 | 51.2 | 5.8 |
| Central Visayas | 28.2 | 38.0 | 7.7 | 40.6 | 50.9 | 5.8 |
| Lowest 4 regions: access to broadband | ||||||
| Caraga | 26.7 | 36.6 | 8.2 | 39.2 | 49.8 | 6.2 |
| Mimaropa | 26.5 | 36.5 | 8.3 | 39.1 | 49.7 | 6.2 |
| Soccsksargen | 26.4 | 36.4 | 8.4 | 39.0 | 49.6 | 6.2 |
| Autonomous Region in Muslim Mindanao |
25.8 |
35.9 | 8.6 | 38.5 | 49.2 | 6.3 |
|
Source: Euromonitor, 2022 *CAGR: Compound Annual Growth Rate |
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Nationally, 92.4% of households in the Philippines had a mobile telephone, expected to reach 95.4% in 2026. In 2021 Household possession of a mobile telephone was most common in the National Capital Region (98.1%), Calabarzon (95.8%), Ilocos (93.9%) and Central Luzon (93.6%), while the regions where this was least common were Soccskgargen (88.5%), Eastern Visayas (88/3%), the Zamboanga Peninsula (87.5%) and the Autonomous Region in Muslim Mindanao (83.8%). Other groups with high rates of mobile ownership included (% of households) other blended families (97.6%), couples with children (95.6%). Homeowners and renters both had a mobile ownership rate of 100.0%. 30-39 was the age most associated with mobile ownership (96.9% of households) followed by 40-49 (95.1%). Employees, as well as employees and the self employed, both enjoyed a 97.0% mobile ownership rate. In 2021, households in income deciles 4-10 all had mobile ownership rates 100.0%. 91.9% of households in decile 3 owned a mobile device, along with 73.8% in decile 2, and 58.4% in decile 1.
Nationally, in 2021, 26.7% of Philippine households possessed a personal computer, expected to reach 34.4% by 2026. The regions in which household possession of a personal computer was most common included the National Capital Region (38.6%), Calabarzon (31.5%), Central Luzon (29.0%) and Cordillera Administrative Region (28.0%). Household ownership of a personal computer was least common in Eastern Visayas (20.5%), Mimaropa (20.5%). Soccskargen (20.2%) and the Autonomous Region in Muslim Mindanao (17.0%). %). Other groups with high rates of personal computer ownership included (% of households) other blended families (33.4%) and couples with children (29.6%), renters (66.2%), and homeowners (30.2%). 30-39 was the age most associated with personal computer ownership (34.1% of households) followed by 40-49 (30.1%). Employers and the self employed enjoyed a household personal computer ownership rate of 31.5%, while for employees it was 31.1%. 100.0% of households in the tenth income decile owned a personal computer, along with 65.0% in the ninth, 16.5% in the seventh, and 5.7% in the first.
| Category (unit)[1] | 2017 | 2021 | CAGR* (%) 2017-2021 | 2022 | 2026 | CAGR* (%) 2022-2026 |
|---|---|---|---|---|---|---|
| Possession of mobile telephone (%) | 88.8 | 92.4 | 1.0 | 93.1 | 95.4 | 0.6 |
| Possession of Smartphone (%) | 50.3 | 71.5 | 9.2 | 75.5 | 86.6 | 3.5 |
| Possession of personal computer (%) | 23.3 | 26.7 | 3.5 | 28.2 | 34.4 | 5.1 |
| Possession of Laptop (%) | 12.1 | 19.3 | 12.4 | 21.4 | 30.2 | 9.0 |
| Possession of Tablet (%) | 7.8 | 17.3 | 22.0 | 20.0 | 30.2 | 10.9 |
|
Source: Euromonitor, 2022 1 - Measurement of unit: % of households *CAGR: Compound Annual Growth Rate |
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Conclusion
E-commerce in the Philippines has seen explosive growth during the pandemic. E-commerce is now the most popular form of non-grocery retailing. Online grocery shopping and sourcing essential items through e-commerce have become common. Due to the pandemic, e-commerce sales of staple foods have increased dramatically. Third party delivery players have become increasingly prominent. Consumers have become used to the convenience afforded by online shopping, and the gains made by e-commerce platforms are expected to be lasting.
Growth in the sector is expected to slow dramatically in the coming years, but remain strong, particularly for food and drink e-commerce. Continued growth is expected to be driven by improving digital infrastructure, increased adoption of online payment, and growth in consumer spending.
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Resources
- Euromonitor International. Digital Consumer in the Philippines, April 2021
- Euromonitor International. E-commerce (Goods) in the Philippines, February 2022
- Euromonitor International. Food and Drink E-commerce in the Philippines, February 2022
Sector Trend Analysis – E-commerce market trends in the Philippines
Global Analysis Report
Prepared by: Brendan Dwyer, Student
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