Welcome to China’s online marketplace, where you can shop by wading through choices, colors, products, offers and content that changes like the wind. If you are a shopper from the Western world, you will be surprised at the difference from your simpler type of online buying.
China has more e-commerce traffic than any country worldwide. Chinese shoppers paid $750 billion online in the year 2016, per China’s National Bureau of Statistics, with this figure being greater than that of the United Kingdom (UK) and the United States (US) together. Chinese consumers spent $750 billion online in 2016—more than the US and the UK combined. While the amount is staggering, far more intriguing to notice is just how China’s digital shopping venue has moved forward as compared to shopping areas on Western sites. This all signals what the shopping future will look like and businesses worldwide need to pay attention.
US retail was greatly changed in the 1990s when Amazon and e-tailing came to the surface, with stores and their customers having to really look seriously at their then current buying patterns. On the other hand, China had less evolved brick-and-mortar shops. At the point where the digital revolution began, so did heighten spendable money and consumer growth. Therefore, e-commerce rapidly became typical, with its growth happening so rapidly that the West lagged behind China.
China was a mobile sales adventurer. In fact, many consumers jumped over the personal computer milieu entirely, instead of going right to their smartphones. This is likely why large screen Samsung phones became popular in China long ahead of that of the markets in the West. While just 46 percent of the phone users in the US will be utilizing smartphones for online buying, estimates for China’s total of e-commerce by 2020 will be at 74 percent.
Within that, the actual speed of e-commerce is not slowing down with estimates of 20 percent rises in China across the next five years. This will be likely twice as much as in the UK and the US. There is another explanation for the uptick in individual spending; namely, there are an expected hundreds of millions of new shoppers coming online on their phones and otherwise. They are coming from rural areas and smaller municipalities.
It is also possible that a companion to this rise will be a greater market penetration in areas that may be starting for the West. In China today, items like luxury cars and organic foods are regularly purchased online. So across the coming five years, the areas in which shoppers will find themselves will be in a range of financial products to snack foods and will take China into approximately 15 classifications. This will be compared to the five categories in the US available from which to shop. In both cases, market penetration will be about 40% apiece.
There are a few primary attributes when it comes to branding, purchasing platforms and types of consumers which make it different from the online sales venues in the US.
First of all, Chinese buyers cannot wait to spend. They do a lot of shopping, with it being about far more than the purchases themselves. It has become a form of social engagement, fun, and learning with internet gurus, stars, and friends. Typical time spent on Alibaba’s Taobao, China’s top e-commerce site, is 30 minutes a day which is three times that of a US buyer spends on Amazon.
Innovation in China fosters great contention. The fact is the sellers online will try and test new product offerings, and if that results in failure, so be it. They also do not have a firm calendar approach to introducing products. Chinese online marketing has gotten better and better as it utilizes all kinds of different approaches to ensure customer engagement. The Chinese make use of various channels and multimedia and are experts in the area of analytics utilizing their information to make the development of product offerings better, too.
Differently than buyers in other countries, Chinese users do not typically use company websites directly. Rather, they have smooth venues that are connected in a very efficient manner. Buying is fun and easy, with connectivity between games, videos and news sites connected to e-commerce in huge hubs housing quick links to product and payment options. These marketplace sites include: Taobao; along with the most popular social media platform, WeChat; and include an entertainment app known as iQiyi.
That said, no matter where they are located, sellers in the West and China are facing complicated problems; namely, how do they sustain growth and keep it profitable? Clearly, many bigger stores and shopping centres with high overhead have lost consumers to sales online. Many exclusive products in China have only been online and they must grow into offline areas, particularly in urban places.
So online and offline abilities must be utilized and prioritized. Things must be smooth yet interesting if not exciting. The lines between on and offline are blurred and with the customer being always right consumers will drive how the enterprises are run. This is referred to by Alibaby as “new retail.”