{"id":12081,"date":"2012-01-24T17:01:01","date_gmt":"2012-01-24T17:01:01","guid":{"rendered":""},"modified":"2012-01-24T17:01:01","modified_gmt":"2012-01-24T17:01:01","slug":"China-is-world-s-next-e-commerce-superpower","status":"publish","type":"post","link":"https:\/\/asiancemagazine.com\/?p=12081","title":{"rendered":"China is world\u2019s next e-commerce superpower"},"content":{"rendered":"

According to a recent report by The Boston Consulting Group (BCG), China is set to become the world\u2019s next e-commerce superpower, surpassing the United States to become the largest online commerce market in the world, with an estimated market size of $300 billion. In 2006, less than 10 percent of China\u2019s urban population shopped online. By 2015, that figure is expected to have quadrupled, reaching 44 percent, while the total number of e-commerce shoppers in China will grow to 329 million.<\/strong><\/p>\n

What\u2019s more, according to BCG, China\u2019s massive geography, a middle class that is rapidly expanding beyond the country\u2019s largest cities, and widely accessible, heavily subsidised high-speed internet \u2014 broadband in China costs just $10 per month, compared with $30 per month in India \u2014 make the country unusually fertile ground for e-commerce, with internet access far outpacing the reach of physical retailers. Indeed, up to a quarter of e-commerce demand in China is for products consumers cannot find in physical stores, with apparel and skincare amongst the fastest-growing online categories.<\/p>\n

But for fashion companies aiming to crack the online retail opportunity in China, it\u2019s imperative to understand that the country\u2019s e-commerce market is very different to established markets in the United States and Europe and that online shoppers in China \u2014 much younger, on average, than their Western counterparts \u2014 have different expectations, preferences and patterns of behavior.<\/strong><\/p>\n

\u201cChinese consumers\u2019 recognition and preference for fashion brands is quite different from mature markets,\u201d said George Wenhong Ji, founder and CEO of Shenzhen-based fashion e-tailer Xiu.com, which sells international luxury brands like Gucci and Chanel, and last year raised $100 million in a second round of funding from elite venture capital firm Kleiner Perkins Caufield & Byers and private equity firm Warburg Pincus.<\/p>\n

\u201cFashion brands that are not so popular could be received very well in China and vice versa. [Chinese consumers] are still price-sensitive and have poor loyalty towards brands,\u201d said Ji. \u201cIt\u2019s important to study Chinese consumers\u2019 income and expenditure \u2013 how much money they earn in different cities of China and how much they would spend on fashion; how much they would spend on fashion online,\u201d he continued.<\/p>\n

According to the BCG report, 7 percent of online shoppers are responsible for 40 percent of online spending. For fashion retailers, the importance of these \u201csuperheavy spenders,\u201d each of whom complete over 50 transactions a year and have a preference for heavily branded goods, cannot be underscored enough.<\/p>\n

\u201cOnline shoppers in China are much more wary than the US and UK,\u201d <\/strong>said Fabienne Pellegrin, Asia business development director for Salvatore Ferragamo, who also oversees the brand\u2019s digital development. \u201cThey need more information than the average online shopper. There\u2019s so much abuse online, so they are programmed not to trust anything,\u201d she continued, emphasising the importance of peer recommendations and user reviews. In fact, over 40 percent of Chinese shoppers surveyed by BCG had both read and posted online product reviews, nearly double the rate in the US.<\/p>\n

Bottomline: Make sure you have a well established working site, with room for lots of feedback before you enter the Chinese market. If you even can!<\/strong><\/p>\n

BusinessofFashion<\/a>
\n<\/p>\n","protected":false},"excerpt":{"rendered":"

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