SHOPPINGCART COPYPORTFOLIO - AN ETORO INVESTMENT STRATEGY
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ShoppingCart CopyPortfolio™ An eToro Investment Strategy
3 Shifting to
e-commerce 4 Why is online shopping
so popular? 5 E-commerce in
numbers
Content
6 What’s driving the
growth of e-commerce? 9 The e-commerce
ecosystem 10
Investing in
e-commerce
2
Shifting to It’s no secret that over the last few decades, e-commerce has revolutionised
the way that consumers spend their money.
e-commerce This new way of shopping has completely disrupted the retail sector, and in
the process, become a multitrillion dollar market.
Yet, realistically, this could still be the beginning of a long-term growth story.
With technology continually making it easier and more convenient to shop
online, the e-commerce industry is likely to experience substantial growth
in the years ahead.
In this guide, we take a closer look at the e-commerce growth story and
explain how investors can gain exposure to online shopping-related stocks
through eToro's ShoppingCart CopyPortfolio.
Add ShoppingCart to your Watchlist
Your capital is at risk
3What is e-commerce? Why is online shopping so popular?
E-commerce is a term that is used to Consumer to consumer (C2C): this is It’s not hard to see why online shopping are offering when shopping online.
describe any transaction that occurs where a consumer sells a product or has become so popular in recent years.
over the Internet. It involves the sale and service to another consumer online (e.g. From a consumer’s point of view, it offers Lower costs: because e-commerce
exchange of goods or services, as well you sell a book on eBay to someone three main advantages over traditional retailers benefit from lower operating
as the exchange of money and data to else) forms of shopping. These include: costs, they can pass on discounts to
execute the transaction. consumers. As a result, it’s often much
Consumer to business (C2B): this is Convenience: shopping online is far cheaper to shop online as compared to
E-commerce transactions can be divided where a consumer sells a product or more convenient than visiting a physical shopping at a physical store.
into four main categories: service to a business (e.g. a photographer retailer. Not only can consumers save
sells a photo to a stock image company) time and avoid queues by purchasing Reasons consumers shop online
instead of in stores
Business to consumer (B2C): this is online but they can also shop 24 hours
Ability to shop 24/7 58%
where a business sells its products or a day.
Ability to compare prices 54%
services to consumers online (e.g., you 46%
Online sale/better prices
buy a pair of shoes from Amazon) Larger choice: e-commerce also To save time 40%
provides consumers with far more Convenience of not going to shops 39%
Business to business (B2B): this is choice. No longer are consumers limited Greater variety/selection 29%
where a business sells its products or to purchasing goods from local retailers Free shipping offers 27%
Convenience of everything in once place 27%
services to other businesses online (e.g. – today they can order goods from all
To locate hard to find items 20%
a software company sells its product to over the world. In addition, it’s very easy
Products are not sold in my city/country 15%
another company) to compare prices that different retailers
4E-commerce
$233 billion
in Numbers Amazon’s net sales in 2018
83%
$3 trillion the proportion of US
consumers that have made a
total global retail purchase on Amazon in the
e-commerce sales in 2018 last six months
$6.5 trillion
expected total global retail
e-commerce sales by 2023
60%
the percentage of total
purchases that US
millennials now make online
47%
the percentage of
consumers who shop
more on their mobile
than in a store
1.8 billion
the number of people across
22%
the world who purchased
something online in 2018
the percentage of total global retail sales
that will be conducted online by 2023, up
from 10.4% in 2017
5What’s driving the growth of e-commerce? 6
Since the mid-1990s, when companies such as around 4.5 billion people globally have access to the won’t be the case. For those growing up now, online
Amazon and eBay were founded, the growth of Internet, up from around two billion people in 2010. shopping is the norm.
e-commerce has been phenomenal. In the years ahead, we can expect many more people
to go online, particularly in the emerging markets.
As more people around the world gain access to the Global smartphone penetration rate as share
Today, nearly two billion people around the world Internet, the number of people shopping online should of population from 2016 to 2020
What’s driving the growth of e-commerce?
purchase products and services over the Internet, with continue to rise.
sales amounting to over $3 trillion globally. 44.9%
Smartphone penetration 41.5%
Yet, there remains vast potential for growth. Despite E-commerce growth is also being boosted by increased
38%
the prolific rise in e-commerce sales in recent years, access to smartphones. As the chart below shows, 35.8%
33.5%
online sales still only account for around 15% of total smartphone penetration around the world is rising
retail sales globally, meaning that e-commerce sales at a rapid rate. By 2021, mobile sales are expected to
could potentially double or triple in the years ahead. represent over 50% of total global e-commerce sales,
up from just over a third of total e-commerce sales in
Here’s a look at some of the key growth drivers of 2017.
e-commerce:
Demographics
Access to the Internet Demographics are another key factor in the growth of
The number of people around the world with access e-commerce. Today, many of those who shop online
2016 2017 2018 2019 2020
to the Internet continues to rise steadily, which means have had to adapt to this new style of shopping which
that more people are able to shop online. Today, didn’t exist 30 years ago. However, in the future, that
7More online retailers Instagram to advertise products and capture sales as people with access to the Internet, augmented
We’re also currently seeing far more products come research shows that social media users often buy things reality set to enhance online shopping experiences,
online. In the past, retailers tended to focus on certain that they have seen online. For example, a study by and technologies such as autonomous vehicles and
products such as clothes, books, electronics, and food Facebook in 2019 found that 54% of people purchased drones set to reduce delivery costs, e-commerce is
when selling online. Today, however, you can buy a product after seeing it on Instagram. The number of likely to continue growing at a fast pace.
everything from speciality coffee to pet food to online people using social media is expected to keep rising in
What’s driving the growth of e-commerce?
through niche retailers. the years ahead.
Number of social networks users worldwide
from 2010 to 2021 (in billions)
Data analytics Payment technologies
Advances in data analytics are also enabling retailers to Advances in payment technologies are also making
2.28
tailor their marketing efforts, which is increasing online it much easier to purchase goods online. Thanks 2016
sales. According to a recent study by Evergage, nearly to innovative payment companies, consumers now 1.59 2.82
90% of retailers have experienced a measurable rise have much more trust in online shopping as they 2013 2019
in sales after personalising marketing efforts. As data can purchase goods online quickly and securely. For
analytics continue to advance due to technologies such those interested in investing in payment companies,
as big data and artificial intelligence, retailers should be eToro offers a MobilePayments CopyPortfolio and a 0.97 3.09
2010 2021
able to continue increasing sales. FuturePayments CopyPortfolio.
Social media New technologies
The rise of social media is also playing a major role Looking ahead, new advanced technologies are
Add ShoppingCart to your Watchlist
in the growth of e-commerce. Today, retailers use likely to continue playing a key role in the growth of
popular social media platforms such as Facebook and e-commerce. With 5G networks set to provide more Your capital is at risk
8The e-commerce Online retailers: Online marketplaces: Multi-channel retailers: Delivery companies:
ecosystem these are companies
that sell their products
exclusively online and do
not have physical stores.
these bring together buyers
and sellers and offer many
different products. Examples
include eBay, Alibaba, and
these are businesses
that sell their goods both
in shops and online.
Examples include Apple,
these play an important
role in the e-commerce
ecosystem as they facilitate
the delivery of goods to
Examples include Amazon, Etsy. Nike, and Macy’s. consumers. Examples
The e-commerce ecosystem ASOS, and Wayfair. include UPS, FedEx, and
Hermes.
consists of companies in many
different industries that together
create a seamless experience for
Network operators: Logistics companies: Payment providers: Price comparison
the consumer. these provide the cellular these help retailers these play a key role in companies:
technology that makes with the storage and e-commerce transactions these enable consumers
e-commerce possible in distribution of goods. by enabling customers to to compare the prices
These include: the first place. Examples Examples include DHL pay for goods quickly and offered by different retailers.
include AT&T, Verizon, and Supply Chain, XPO securely. Examples include Examples include Google,
Vodafone. Logistics, and Tritax Visa, Mastercard, and PayPal. Trivago, and Skyscanner.
Big Box.
Cyber security Software and
companies: automation companies:
these help ensure that these help retailers
consumers do not fall streamline processes to
victim to cybercrime when increase efficiency and
making online transactions. reduce costs. Examples
Examples include Symantec, include Shopify, Ocado,
McAfee, and Palo Alto and SAP.
Networks.
9Investing in e-commerce
Naturally, the growth of e-commerce is creating some amazing opportunities for To help investors gain exposure to the theme, eToro has created the ShoppingCart
investors. Just look at the rise in Amazon’s share price since the company’s Initial CopyPortfolio – a fully allocated thematic investment portfolio focused specifically
Public Offering (IPO) in 1997. on online shopping stocks.
Yet, it’s important to realise that not every e-commerce stock performs like Amazon’s. Designed to help long-term investors capitalise on the investment opportunities
The e-commerce industry is highly competitive, which means that there will be both created by the growth of e-commerce, this investment strategy offers exposure to a
winners and losers. broad range of online retailers.
If you’re looking to invest in the e-commerce industry, the most sensible approach For those looking to gain exposure to the e-commerce theme, eToro’s ShoppingCart
is to spread your exposure over a number of different companies. That way, you’ll CopyPortfolio offers an innovative and cost-effective way to invest.
minimise company-specific risk.
Add ShoppingCart to your Watchlist
Your capital is at risk
eToro is a multi-asset platform which offers both investing in stocks and cryptocurrencies, as well as trading CFD assets. Your capital is at risk. CopyPortfolios™ is a portfolio management product. CopyPortfolios™
should not be considered as exchange traded funds, nor as hedge funds. Zero commission means that no broker fee has been charged when opening or closing the position. Other fees may apply. For additional
information regarding fees click here.
10Resources:
https://assets.kpmg/content/dam/kpmg/xx/pdf/2017/01/the-truth-about-online-
consumers.pdf
https://www.statista.com/statistics/379046/worldwide-retail-e-commerce-sales/
https://www.oberlo.co.uk/blog/online-shopping-statistics
http://www.annualreports.com/HostedData/AnnualReports/PDF/NASDAQ_
AMZN_2018.pdf
https://www.bigcommerce.co.uk/blog/ecommerce-trends/#96-data-points-on-the-
state-of-ecommerce-around-the-world
For more information regarding CopyPortfolios, https://www.smartinsights.com/digital-marketing-strategy/online-retail-sales-growth/
https://www.digitalcommerce360.com/2019/03/26/millennials-online-shopping/
contact: copyportfolios@etoro.com
https://ibotta.docsend.com/view/8djn9af
https://www.bigcommerce.co.uk/blog/mobile-commerce/#common-benefits-of-
mobile-commerce
https://www.internetworldstats.com/emarketing.htm
www.etoro.com https://www.bigcommerce.co.uk/blog/mobile-commerce/
https://www.statista.com/statistics/203734/global-smartphone-penetration-per-
capita-since-2005/
https://www.evergage.com/wp-content/uploads/2018/04/Evergage-2018-Trends-in-
Personalization-Survey.pdf
https://parcellab.com/en/blog-en/e-commerce-en/the-power-of-instagram-to-drive-
sales/
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