Global-E Online To Grow Continuously for the Next Few Years. Here’s Why!
Recent times are witnessing quite a fluctuation in the fortunes of some significant e-commerce players, with the latest tech sell-off being particularly harsh for unproductive growing businesses. The fast-growing cross-border e-commerce solution provider Global-E Online has not been left untouched either, having its stock drop more than 60% from its top of $84 to $32.43.
As such, the market has witnessed a U-turn this year, with the Investors now being bearish on high-growth technology companies compared to being bullish on the same set of companies last year. Despite all the upheaval, the general mood of investors towards Global-E Online has remained the same. It’s so because, despite the recent drop in its stock price, the company has demonstrated fascinating possibilities overall.
Let’s take a look at some of the reasons that predict Global-E Online to grow continuously over the next few years:
- A significant addressable market
Ever since assisting clients in the United Kingdom in selling abroad, Global-E has grown its client base to include areas throughout the United States, Europe, and Asia. Having seen its revenue rise more than six-fold from $39 million in 2018 to $245 million in 2021, Global-E has been equally adept in demonstrating its financial success. The prediction by Global-Es’ IPO prospectus indicated the global and cross-border e-commerce markets to reach $5.8 trillion and $736 billion, respectively, despite having accounted for only $1.4 billion of the gross merchandise value (GMV) in 2021. These numbers, however, are just a fraction of the total market share that it is expected to achieve in 2023.
Significant investments exacerbated Global-E loss-making position in 2021 to gain market share and attract new clients from current geographies and sectors. Despite the initial overwhelming losses, Global-E has been planning to expand rapidly into new countries and industries like Tokyo and Australia. Since the e-commerce industry is known to be ruthlessly competitive, and there is no assurance that the IT firm will flourish in these fresh markets, still there is a reasonable likelihood that it will do so in at least a few of them.
- Ever-increasing customer wallet share
Global-E can also develop its company by leveraging its existing client base and bringing new consumers to its platform. Because it charges a portion of its GMV as fees, the increase in GMV’s customers can help Global-E grow its revenue and profit. As long as merchants continue to increase their cross-border sales, Global-E will continue to benefit and prosper.
Companies can also expand their wallet share by enrolling other brands and products on Global-platform to leverage the deepening of the relationship between Global-E and its customers over time.
Global-E can also continue to provide new products and services to assist clients in managing their cross-border e-commerce operations more efficiently, thus powering its growth by significantly improving customer satisfaction and retention.
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- Forging Collaborations
By providing Shopify a share in their company in exchange for access to Shopify’s merchants, Global-E has created solid collaboration with Shopify to assist and expedite its own developmental goal. This collaboration between Shopify and Global-E is a win-win situation for all the parties involved. It has resulted in both the merchants now having access to a worldwide market without fussing over any of the extra complications.
Apart from the crucial, growth-inducing partnership, Global-E has with Shopify, it’s not the only one that Global-E can foster. On the contrary, Global-E can also look forward to forming alliances with other businesses to aid its expansion plans. An example of this is Global-E’s most recent partnership with Meta Platforms. This partnership enables the provision of cross-border e-commerce solutions for Facebook’s merchants.
Global-E can also look forward to launching its marketplace, which would allow it to attract technology partners and be a recipient of additional tools and services to assist merchants in flourishing on its platform.
Despite analysts and experts not banking on Global-E Online as one of the best stocks to buy right now, there’s no reason why the company should be hindered in its growth. With skyrocketing projections about its growth and the recent developments and progressive steps are undertaken, it’s safe to assume that the future looks bright for Global-Ecommerce.
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