China, already home to the world’s largest online population, is likely to

China, already home to the world’s largest online population, is likely to replace the United States as the biggest e-commerce market by 2015, according to new research.

China’s e-commerce market is currently worth $74 billion – less than half that of the United States at $177 billion, a new report by the Boston Consulting Group said.

But it is growing rapidly, spurred by increasing Internet use – China now has an online population of more than half a billion – the low cost of shipping and a passion for shopping among China’s growing middle class.

Within five years, online shoppers in China will be spending an average $980 per year – twice what they spend today and close to the US average of $1,000, said the report, issued on Tuesday.

Up to a quarter of e-commerce demand is for products consumers cannot find in physical stores – a circumstance unique to China, whose huge size limits the coverage of physical retailers, it said.

The e-commerce industry benefits from China’s low cost of shipping – one dollar on average to ship a one-kilogramme parcel, versus six dollars in the United States, it said.

E-commerce in China will go from representing 3.3 percent of the country’s total retail value today to 7.4 percent in 2015, an expansion that took the United States a decade to achieve, it added.

Source AFP