E-Commerce: Li Keqiang, Urges Support for Cross-Border E-Commerce

17/06/2019

Chinese government supports cross-border e-commerce. PRC Premier: “Innovative oversight helps companies improve their cross-border business”. Now Chinese firms are going global

 

Greater policy support and innovative government oversight is needed to shore up the growth of cross-border e-commerce, Premier Li Keqiang said during an official visit in Zhejiang Province last week. Chinese PM visited a pilot zone in Hangzhou dedicated to cross-border e-commerce.  The premier also visited the Dream Village, a major hub for startups and incubators in Hangzhou.

During his inspection, the premier underlined the role of cross-border e-commerce in enabling more businesses to take part directly in international trade. As reported by media, he noted that the business model is a major trend for the future development of international trade, and it will help promote the integrated development of businesses of various sizes and benefit the upgrading and branding of domestic manufacturers.

 

 

China’s total volume of imports and exports from cross-border e-commerce reached $19.5 billion in 2018, up 50 percent year-on-year, according to the General Administration of Customs.

The premier also urged more efforts to encourage the private sector to boost the development of services including elderly care, day care as well as domestic services. To make administrative services more accessible, Li said reforms must be conducted to enable the services to be accessed via one website so that the public can be saved the trouble of making trips to government offices.

 

China is leading e-commerce sector. Today they’re seeking opportunities out the country, especially in Europe, and this is great change to European firms too. Is Europe PRC’s e-commerce platforms next battleground? Apparently yes.

 

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.  What about Europe?

According to data, cross-border ecommerce is becoming increasingly popular in Europe. Of the parcels bought cross-border last year, 38 percent were purchased from China. And consumers prefer more and more to shop across the borders using their smartphones. As Chinese e-commerce giants are well positioned in the area of m-commerce (online sales through mobile devices) experts reported that they will turn to Europe for their next battleground.

 

 

European e-commerce market accelerates thanks to Chinese platforms too. In Europe PRC based e-commerce firms are expected to be focusing on product categories where other competitors have left space or where product categories are lagging behind for online sales. As reported by GfK “Today’s consumers in the 18 European countries are feeling most comfortable buying IT products online (online share: 38 percent) over other product types.

However, less popular online category sectors such as Telecommunication (online share: 21 percent), Consumer Electronics (online share: 22 percent) and Small Domestic Appliances (online share: 28 percent) are again showing high levels of online growth in the first half year 2018 – making these the product sectors to watch for increasing levels of online sales activities.”

 

e-commerce

GfK also points out that “For a growing number of tech-savvy, time-poor consumers, shopping from a smartphone or tablet is becoming an increasingly popular way to buy online. For more than every second technical durable goods shopper in 2018, their mobile device is becoming their most important shopping tool with a significant upward trend (2015: 40 percent).

Again, the Chinese e-commerce giants are well positioned in the area of m-commerce through many years of experience in their home markets. Buying mobile is already mainstream in China, and for more than 80 percent of all technical durable goods shoppers in China, their smartphone or tablet is the preferred shopping device.”

 

Radical strategy change: Importance of physical stores and omni-channel distribution strategies.

 

If for Western firms entering the Chinese e-commerce market is not easy, PRC based companies are facing same challenges in European market too. Recently e-commerce giants such as JD or Alibaba had put in act a radical strategy change. In Europe physical stores are still important for business, while omni-channel distribution is becoming much more popular.

The GfK also stated that  “Strong alliances amongst key players in Europe will be able to address these new challenges in the retail sector. Partnering retailers will take competitive advantage of their unique omni-channel selling propositions – allowing them to bring the best on- and offline shopping experience to their customers through new technologies, joint innovation activities, and co-investments into big data analytics.

As much as the ongoing changes in Europe can be seen as most disruptive for technical consumer goods retailing, ‘traditional’ retail has not lost its attraction: The percentage of consumers who believe that physical stores today are less important than a few years ago has not changed over time (2015: 43 percent vs 2018: 43 percent).”

MORE ON THIS TOPIC

Leave a Reply

Your email address will not be published. Required fields are marked *