China, the e-Commerce Behemoth

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e-Commerce, a way of life.

In other countries, e-Commerce is just another option to go shopping while in China it is a way of life.
Today it is easy to pretend otherwise. But 10 years ago, no one would have bet that China would become the biggest e-Commerce market in the world, ahead of the United States and the United Kingdom, with 721 million Internet users as of 2016, compared with only 2.1 million in 2000. At that time, online payment and delivery systems were almost non-existent. The Chinese market is now growing by about 25% each year.

In 2017, there are more than 656 million mobile Internet users in China, which leaves a good margin of progression. Thus, each person connected to the Internet, whether through its mobile or desktop computer, is a consumer likely to buy its products via e-commerce.

Why such growth?

The reason is simple, it is partly due to the rapid expansion of smartphones that allow many Chinese, even those living in remote rural areas, to have access to the Internet. So many of them those days make purchases directly from their mobile. This allows them to have access to a larger number of products without having to travel to large cities.
e-Commerce transactions from smartphones are thus booming: + 240% compared to last year for a turnover of 928 billion RMB (120 billion €).

Nowadays, it is possible to do everything and to buy anything with a mobile device: electronic products, household products, food products, cosmetics, fashion products, travel services… etc. With nearly 80% of Chinese users using their smartphones to surf the net, m-commerce is expected to triple by 2018!

To attract Chinese consumers and make them buy your products, it becomes almost compulsory to go through the Taobao and Tmall marketplaces in order to reach them. Wechat has also become a true bridge between brands and consumers. You must adapt your digital marketing plan to these social media platforms in order to attract more consumers.

Yhd.com, a Chinese online supermarket has decided to offer discounts for Chinese consumers making their purchases on mobile. Moreover, it plans to increase its investments in this sector. Yhd.com is not the only company to bet on the future of m-commerce. Tencent, has integrated a payment feature, in its flagship social network, Wechat. In the same spirit, the Alibaba group also launched Laiwang. Implementing or not those marketplaces within your e-Commerce website might soon not be an option anymore.

2 Comment

  • Don't you think that the Chinese economy will slow down at some point, and thus that eCommerce will slow as well? Based on the BBC (http://www.bbc.com/news/business-35693794) it has already started. Mass media seem to disagree with your optimism.

  • Francis Massolin's picture

    Super high growth is indeed over, but you are referring here to the overall GDP. If it is true that other sectors of economic activities such as the building industry to name just one, are slowing down, it is not the case of eCommerce. The desire of the Chinese consumer for online retail products, being apparel products, electronics or furniture, doesn't seem to slow down. We don't say it won't, but not for the next two years at least.


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