E-commerce in China? Almost US$7 trillion business


China retail trend 2019; to hit US$6.77 trillion, fueled by e-commerce and new retail


PRC leads the world in e-commerce. Today, more than 40% of whole online transactions take place in China. One decade ago, PRC’ s e-commerce transactions count only 1%. China e-commerce is much more than simply a means for consumers to secure bargains on everyday purchases. It is an important driver of economic and social development that is powering transformational change across the country.

Local Chinese tech giants such as Alibaba Group, Tencent and JD dominate a rapidly growing e-commerce ecosystem, at the beginning mostly within China. But now those companies are going outside.

According to China Economic Review, China’s retail market is estimated to hit US$6.77 trillion by 2019 with e-commerce representing 14.46% of this market. The population of post-80s and post-90s totaled nearly 411 million, more than that of North America.

As the millennials group is becoming stronger in consumption and disposable income, brands come to treat them as target customers. 92% of consumption will come outside of tier-1 cities between 2016 and 2030.

As Jack Ma stated at the 2018 World Economic Forum Annual Meeting in Davos: ”No-one can stop globalization, no-one can stop trade.” And it’s true. As WTO recently underlined, one of the greatest indications of the role e-commerce plays in driving globalization is the amount of cross-border e-commerce between China and the rest of the world.


Tree years ago, the market size of cross-border retail e-commerce sales in China was $78.5 billion; experts expected that this number will exceed $140 billion by 2021. What is driving this trend?


First, today the number of Chinese go abroad to work, study and travel touched a new record. It means that they are gaining exposure to more international brands and products than ever before. When they return home to China, these shoppers rely on cross-border e-commerce to purchase international products that are either not available domestically or are too expensive in local flagship retail outlets within China.

Second, due to concerns around consumer and food safety, Chinese consumers are turning to cross-border e-commerce as a way to access trusted international brands. This is particularly the case for key product categories such as baby products, health and nutrition, beauty and organic food products.

Third, integration of online and offline. In the west, when Amazon acquired Whole Foods Market, everyone speculated how  combined those two firms : an online brand with a brick and mortar one in order to produce a new generation of digitally-connected retail. Well, that future has already arrived in China years ago.

Alibaba and JD are rapidly opening retail outlets across the country, called Hema and 7Fresh respectively. Both brands offer a wide range of digitally-connected experiential shopping.  First, clients customers can use their phone to scan the barcode of any item in the store to learn about the product’s source, nutritional information and price. Delivery is available at both stores in as little as 30 minutes after consumers have made their purchases. The future of e-commerce and online business is speaking chinese


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