With the number of young Malaysians getting disposable income at a rise, it is not surprising to see them spending the money on small luxuries. Even more so when there are more households that are connected to the internet, the number of Malaysians who are spending money to buy products overseas have risen as well.

A study was recently done by PayPal to reveal the trend and attitude of Malaysian shoppers when it comes to online purchasing. According to the research, which was done by the Nielsen Company, the Malaysian online shopping market has reached a tremendous number of RM1.8 billion in 2010 and has estimated that this will continue to grow up to RM5 billion in 2014.

“With the online shopping market growing so quickly and nearly reaching the two billion Ringgit mark, Malaysians are finding great value in buying products and services via the Web as part of their daily lives,” said Elias Ghanem, PayPal’s Managing Director and General Manager for South East Asia and India.

The results have also shown that while there were 1.1 million online shoppers who spent on average about RM 2,461 a year, about 70% of the total online shopping spending came from the middle income and above groups in the country.

The study also breaks down the number of Malaysians buying from both local and overseas websites, including the amount of money spent on them. Malaysians have been seen to spend more on local sites than international ones as online retail purchases worth RM825 million were spent on the local e-market, which garners a market share of 45%, and RM627 million for overseas e-retailers, while the remaining RM371 million or 21% of the market share goes to websites with unknown countries of origin.

When asked for reasons as to why Malaysians purchase from international websites, the more common responses include local unavailability (65%), greater choice (55%) and higher quality (36%). This paves a path for the growth of local Malaysian online shopping market by providing a variety of high quality goods from their online stores.

Aside from providing the numbers to where and why Malaysians shop online, the study also shows what exactly they spent their online money on. The big three of Malaysia’s online expenditure include travel, which has a 24% share on the local market, bill payments, with 18% share and entertainment and lifestyle, which has a 14% share in the local market.

Malaysians also go online to purchase other products and services, but the big pull with the first three categories is because of the infrastructure already set in place for customers’ convenience. The travel and bills category especially garnered high sales points because it is more convenient for customers to purchase tickets and pay for their bills online than having to line up somewhere that is crowded and difficult to move around.

Based on the online shopping study results, Elias reiterated that, “The strong call-to-action for local merchants is to quickly adopt a multi-channel retail strategy, provide greater product choice and higher quality items in their online store, and offer more secure online payment options. In order to sell to mobile shoppers, they should choose a safer mobile payment method that can be completed in as few clicks as possible.”