With China’s e-commerce revenue for 2022 projected to reach US$1.412 billion, the country has emerged as the largest market and economy for e-commerce in the world. Estimated to reach a staggering US$3.3 trillion by 2025, the expected amount of e-commerce consumers is predicted to hit 1,230.4 million by the same year. These stats highlight the immense potential for market penetration by retailers.
Undoubtedly, COVID-19 was a driver of heightened e-commerce activity worldwide. However, with more e-commerce companies coming to the fore in China and locals growing accustomed to the convenience of online shopping, more is the consumer confidence in using e-commerce platforms.
As the Chinese online market keeps growing even as the effects of the pandemic start to fade, now might be the ideal time for your business to capitalise on the opportunities in China and expand your sales from India to the country.
Catalysts for China’s economic growth in the e-commerce space
1. High levels of internet usage and digitalisation in China
As of 2022, China had 1.02 billion registered internet users. And this number is only set to increase further as more rural areas in China are being modernised and retrofitted with technology to enable internet use. Alongside the growing amount of internet users, the creation of new e-commerce platforms and high mobile commerce rates in the nation bodes well for international companies looking to sell to China.
2. COVID-19 made more consumers go online
With COVID-19 causing many brick-and-mortar stores to roll down their shutters during mass lockdowns in China, many consumers had no choice but to turn to online shopping to get their essential items. Unable to buy what they needed from physical stores, e-commerce platforms became a necessity for locals. However, the ease, convenience and comfort of being able to shop from home rather than partake in traditional commerce is a trend that has continued beyond the pandemic.
3. Growing spending power of China’s middle class
Powered by China’s economic growth, the incomes of the middle class in China has increased substantially over the past few years. As a result, members of this socio-economic band are spending more of their disposable income on non-essential goods and services. With their growing spending power, price is no longer the influencing factor when it comes to purchasing decisions. Increasingly, Chinese consumers are looking for high quality goods and services to spend their income on. This search has not been limited to the local market and has driven them online to global e-commerce platforms, representing a market segment that businesses in India can target.
Why should you take your business to the Chinese e-commerce market?
According to a report, 37% of the global e-commerce market share is owned by China, a statistic that highlights how there is untapped potential for international businesses for cross-border e-commerce. The numbers do not lie as an estimated valuation of a company’s growth when selling on China’s e-commerce platforms is set at an approximate 20% increase in sales. This makes China’s e-commerce market the perfect target for any business in India that wants to grow in the long term. Here are two strategies to start doing so:
1. E-commerce platforms in China
Out of the many e-commerce platforms in China, the most famous one is Alibaba who owns several platforms, including Alibaba.com, Taobao, and TMall. Companies in India can also look into other online platforms, such as JD.com, which enables Chinese consumers to buy products from all over the world through its cross-border service, JD Worldwide. With a plethora of e-commerce platforms, businesses in India are sure to find an e-commerce platform that fits their target market and marketing strategy best.
2. Social Commerce
If you want to build brand awareness and take advantage of the huge cross-border e-commerce market in China, you need to establish your brand on social networking platforms. With many Chinese consumers using social media sites like live streaming and product reviews to make decisions about what to buy, the number of livestream broadcasts on key e-commerce platforms in China was more than 24 million in 2020. A strategy to ensure your products are popular in China is to find Key Opinion Leaders and get them to market your products through these mediums. To increase traffic to your online store from Chinese consumers, have a social media marketing strategy and an e-commerce site that is optimised for mobile usage. Also, make sure your website is mobile-friendly and that the content is written in the local dialect to encourage them to purchase your products through their phones.
Work with DHL Express as part of your e-commerce strategy
Besides a strong marketing strategy, partnering with a capable logistics shipping company will also help to garner favourable reviews and feedback from Chinese e-commerce consumers. As the leading logistics and shipping partner in the world, DHL Express India will ensure your e-commerce growth strategy is assisted with time-sensitive delivery services, cost-effective logistics and knowledge. Open a DHL Express account with us today and watch your business expand.
