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E-commerce landscape in China: Latest Trends


E-commerce is a whimsical thing that visits one time and then leaves the next. Today's online shopping has become more accessible than ever, making it difficult to satisfy customers, while growing consumer expectations are always fulfilled. For consumers who are not in a hurry to shop, a mere “online” shopping is no longer satisfactory. They are looking for a shopping experience with interactive and immersive experiences. And it’s no surprise that China is one of the most dynamic e-commerce markets in the world today.

According to a report published on the occasion of the Chinese salon Big Data Industry Expo 2019 in Guiyang in May, the volume of China's e-commerce reached 4.58 billion of dollars in 2018. The report on the development of digital commerce the country in 2018 also revealed that online retail sales accounted for $ 1.3 trillion while online payment exceeded $ 28 billion with over 50 billion packages delivered.

These numbers were made possible by many factors, such as the growing number of Chinese netizens and a mobile-oriented society. In fact, Internet users in the country have already reached 900 million people, 98% of whom have access to the Internet via smartphones. Therefore, as China's digital evolution drives its own economic growth, Chinese consumers and foreign brands are big fans of cross-border e-commerce. 

Trends to watch in the China’s E-commerce Landscape

  • The rise of luxury e-commerce platform – Although for the luxury sector, the e-commerce approach has not been as immediate as for other sectors such as electronics or cosmetics, much Chinese high-end e-commerce is currently developing the e-commerce platform. Indeed, in terms of luxury consumption, Chinese consumers have been in first place for three years now, accounting for one-third of global spending. The younger generation of Chinese people represents 27% of luxury consumers. Therefore, although luxury brands have been accustomed to using offline sales rather than online sales, the digital world has become the most effective channel for dialogue with Chinese Millennials and Generation Z.

As a result, the Chinese luxury goods market is currently witnessing a shift from offline to online, especially in smaller cities, where high-end stores are scarce and unaffordable. In addition, if previously luxury buyers were traveling to buy high-end products, today a growing percentage of consumers are buying directly in mainland China via its multiple luxury e-commerce platforms.

  • Online delivery of fresh products – The latest trend in the e-commerce industry is the delivery of fresh products online. This is a trend that will undoubtedly have a significant impact on global sales. China has witnessed tremendous changes in the food industry. According to the “China Household Table Consumption Trend Report” released by Alibaba in 2017, 60.5% of China's fresh food is sold online. In the first- and second-tier cities, at least 82% of Chinese consumers occasionally buy food and beverages online. In fact, fresh food e-commerce has developed rapidly in this Asian country in 2014 and 2015, but since 2016, digital giants such as Alibaba and JD.com have revived the market by increasing supply chain and logistics investment.  
  • China exports e-commerce culture – China not only sets the pattern for cross - border e-commerce but also exports e-commerce culture abroad, thus contributing to the growth of foreign digital markets. In particular, on continents such as Africa, although e-commerce is far from the country’s most important sources of revenue, the market is growing and developing rapidly. Here, Chinese companies are still testing the waters while seeking collaborations with Western companies and players.

Chinese giants like Alibaba are investing heavily in emerging countries such as Turkey, Vietnam, Indonesia, India, and Africa, where American actors like Amazon have shown little or no interest and where they can emulate their successful model already tested at home.  Online platforms help growing middle-class companies around the world bypass traditional, often more expensive, retail channels, and also facilitate local producers' access to global markets. The People's Republic of China, whose digital economy has experienced massive growth over the past decade, is a good model for continents such as Africa or countries like India, both seeking to strengthen their economies. 

  • Social e-commerce – China leads the world in e-commerce. Today, more than 40% of online transactions take place in China. Ten years ago, China’s e-commerce transactions accounted for only 1%. However, even if China has many good local brands, the Chinese still have a kind of worship for foreign goods. Especially when it comes to health care, baby products, food supplements or skincare products, Chinese people are more inclined to turn to foreign companies. In addition, Chinese consumers are becoming more aware of international brands, which make cross-border e-commerce platforms increasingly demanding overseas products. Although Chinese local technology giants such as Alibaba, Tencent, and JD.com dominate the fast-growing e-commerce ecosystem, international brands can also leverage other e-commerce platforms in China. Among them, Kaola.com is China's largest retail e-commerce platform, and Mia.com is China's largest e-commerce platform for importing pregnant women and baby products.

Final Thoughts

In today’s uber-competitive e-commerce environment, companies seek to attract customers through a radical approach by providing highly-engaging and meaningful user experiences. With the technological advancements, the upcoming years will experience changing e-commerce landscape more than ever. The modern techniques blending with the e-commerce sphere are providing an exponential hike in sales and customer satisfaction. With technologies like augmented reality, merchants have been able to give the best visual shopping experience at the convenience of their homes.