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China’s cross-border e-commerce market soars to $220bn in 2017

China’s cross-border e-commerce market soars to $220bn in 2017 article image

The e-shopping frenzy in China shows no sign of slowing down.

A study by consulting agency Westwin released last month shows 67 percent of Chinese e-commerce consumers bought products online last year – up 34 percent from the previous year.

On average, China’s cross-border buyers ordered more than once per month from overseas, the report shows.

Last year Chinese consumers bought US$220.3 billion worth of imported goods online – a US$58.7 billion increase over the previous year, the report shows.

The country’s cross-border e-commerce shoppers are, in general, wealthier than those who only purchase domestically.

More than half (53 percent) of cross-border consumers spent more than US$1,400 each and 15 percent of them spent over US$2,900 over the past 12 months.

In particular, female consumers and those with children were bigger spenders and spent more frequently than others, the report notes.

Tmall Global, JD Worldwide, and Amazon were the most favoured e-commerce platforms by residents in China’s big cities.

Kaola by NetEase, Suning, Vipshop, and Redbook were the go-to places for dwellers in smaller cities.

The report also said that “authenticity with guaranteed quality” was the top factor that determined consumers’ choice of the e-commerce platform.

When it comes to settling the orders, Alibaba’s payment solution Alipay was the number one option, with 91 percent of surveyed respondents using it. Bank cards (68 percent) and WeChat Pay (64 percent) were also popular.

Appetite for foreign goods

China’s appetite for foreign goods has shown consistency and maturity.

Of those surveyed, 26 percent are high-frequency shoppers, completing over 20 cross-border orders over the past 12 months. 

Cosmetics was the most-purchased category. Female consumers continued to be the main contributor to cosmetics sales, but the male counterpart is quickly catching up. The category of apparel & footwear was a close runner-up, followed by electronic products and food.

China’s key opinion leaders (KOLs) are the most effective channel (67 percent indicated they look to KOLs to know what to buy) to affect consumers’ purchasing decision, even more important than factors like “product discount” (65 percent), “e-commerce recommendation” (58 percent), and “advertisement/creative events” (38 percent).

Overseas spending

The Westwin report also examines the purchasing behaviours of overseas Chinese nationals.

Overseas spending by Chinese consumers, which include spending by outbound Chinese travellers and Chinese overseas residents, rose to US$200 billion in 2017, the study shows.

The outbound spending by Chinese tourists alone reached US$115.2 billion in 2017 – a 5 percent increase over the previous year.

The expenditure for this sector is projected to grow by 4.3 percent to reach US$120.25 billion in 2018, the report says.

China’s neighbours Japan (67 percent) and South Korea (62 percent) were the most visited countries last year, followed by the United States (53 percent), Australia (51), and the United Kingdom (47).

The purchasing preference of Chinese overseas tourists has demonstrated a high level of similarity to the country’s cross-border shoppers. Cosmetics category was the most purchased one, followed by apparel & footwear, food, electronic products, and pharmaceutical products.

Bank cards became the main payment method due to the safety concerns. Alipay was chosen by 69 percent of surveyed respondents to complete orders, followed by cash (50) and WeChat Pay (46). 

Source: Jing Daily

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