China’s e-commerce market is really booming. It continues to experience strong double-digit growth year-on-year.
You plan to know what are the next trends in ECommerce in China ? Really .. You need to move to Shanghai… (And you can find a Guide to help you)
1- CHINA: THE ECOMMERCE MARKET
China’s economy continues to grow steadily at the end of 2017 with a GDP of 6.8%, according to China’s National Bureau of Statistics (SNB). In line with this positive momentum, Nielsen saw China’s Consumer Confidence Index (CCI) reach an all-time high of 114 points in the third and second quarters of 2017, up two points from the second quarter of 2017, and six points the fourth quarter of 2016.
ICC scores above and below 100 points. As stated by the NBS, an all-time KIC, has identified an increase in disposable income of 7.5%, that consumers are confident and that consumer demand remains stable. We are seeing an increase in consumption as Chinese consumers spend more than ever: 43% more than five years ago. This is ahead of growth of 24% in the United States and 33% worldwide.
Nielsen’s e-commerce tracking data, in 34 categories of consumer goods, showing that on a 12-month moving average from November 2017, online sales grew 27% over the previous year . same period. Meanwhile, the ratio of businesses to e-commerce services has increased significantly over the past year. According to the Nielsen CCI report, until December 2016, the ratio of companies that launched online sales exceeded 45%.
There is no doubt that China’s e-commerce market is on an overall upward trajectory. In the same vein, Nielsen has identified five key trends that we believe drive market development, and that will be critical to ensuring business success in 2018.
2. Top eCommerce Festivals
E-tailers create more shopping festivals and themes to unleash the desire of consumers. According to the Nielsen survey, before Double 11 this year, 79% of consumers said they planned to participate in Double 11. Alibaba saw RMB 168 billion in sales and 39% growth on singles day, while another main competitor, JD.com, made 127 billion yuan from November 1 to 11, with growth of more than 50 percent.
Double 11 and similar shopping festivals are an opportunity for local brands, but also opportunities for brands. During these holidays, consumers experiment, try new things and buy products that may be new to them. These festivals are the perfect opportunity for new brands entering the market to get noticed.
Two actors resulting in a trend known as “upgrading consumption”. The increase in disposable income means that consumers are more confident of spending their money in a number of categories – especially food, cosmetics and clothing. The emphasis on quality and fashion is growing much faster than other consumer demands. Subsequently, consumers in the middle and upper classes, now their demand for goods that are not available in the domestic market. Online platforms, with easy access to international, high-end and niche brands, are gaining popularity, while cross-border trade sites are the first to follow the consumer upgrade movement. .
According to Nielsen’s online shopping trend report, the proportion of foreigners increased again by 67% in 2017, compared with only 34% in 2015.
Imported products are recognized by Chinese consumers for their attention to quality, health and safety and even packaging design. Through various
New retail: 020 is merging faster
Since the term “new retail” was coined by Jack Ma in 2016, it has been a hot topic for manufacturers and retailers. This concept focuses on integrating online and offline retail elements, including products, services, logistics, big data, marketing, management, and more.
Currently in China, online players take the initiative to lead this integration. As the largest electronic commerce platform in China, Alibaba recently invested $ 2.9 billion in China’s largest offline retail group, Sun Art.
The Online to Offline (O2O) business model is transforming the retail industry and bringing both challenges and opportunities to the market. Hema Supermarket is a good example of the evolution of e-commerce giant Alibaba in the O2O landscape. Hema is a store with fresh foods, imported products and catering services like other physical supermarkets. Before buying, consumers are encouraged to download an app through which products are purchased and where spending and consumer profiles will be saved and stored online. Consumers can enjoy door-to-door deliveries within 30 minutes if they live nearby. JD.com has just launched a similar offline offer called 7Fresh, and should quickly become a key player in this O2O space.
Both Alibaba and JD.com also focus on millions of other grocery stores in China because they believe that these stores are places where consumers can be targeted to boost the penetration of payment platforms and e-commerce.
Online payment are Advanced
Alipay and Wechat online payments are the most popular online payments in China, and they are already an integral part of e-commerce platforms such as Alibaba and JD.com.
Online financial companies like Al Financial’s Al Financial and JD’s Baitiao are becoming increasingly popular among Chinese consumers, especially young borrowers, because of the low fees and the convenient user experience. As disposable income and consumer confidence increase, the availability of consumer loans encourages consumers to spend even more online.
Just as credit cards have boosted demand and enabled consumers in markets like the United States to make significant purchases, e-merchant financing will allow a similar trend in China, where traditional credit cards are more rarely used. In addition, consumer loan providers are expanding their business by cooperating with offline channels, providing comprehensive consumer service portfolios facing the integration of new retailers.