3 Events Changing Ecommerce in China

Betty Touzeau
by Betty Touzeau 06 Feb, 2017

From Jan. 28 - Feb. 15, China celebrates its New Year: and what a year it's been.

As the world's largest ecommerce market since 2013, China now has hundreds of millions of online shoppers buying gifts for their loved ones for the New Year's celebrations. Looking back over the year, 2016 saw a continued success for China, with three events in particular changing the game and shaping the market.

Trade regulations changed

With a growing number of Internet users and issues with counterfeiting in the market, Chinese consumers have started to shop more on foreign ecommerce sites. This led the Chinese government to review its ecommerce policy, and in April 2016, new regulations were put in place for the import and export of goods and services from China. These new reforms have had a particular impact on the volume of imports and on values declared for the level of imports. So, if a Chinese consumer decides to shop from a foreign site, their expenses will have to be fairly limited (2,680 euros per year) or they will be taxed more. With these new rules in place, China intends to further regulate the entry and exit of goods from transactions in the ecommerce market.

Mobile devices & social media continued to flourish - especially video

Video saw a huge rise globally in 2016, and China was no exception. Through short videos and live videos posted on social networks, Chinese Web influencers used video to talk about products and brands. This was such a huge potential that Alibaba's subsidiary, TaoBao, launched TaoBao Live, an online video site allowing ambassadors to promote products live to their followers. They also used social networks (of course) like WeChat, which has become a sales platform in its own right - brands like Christian Dior, Burberry and Starbucks have used WeChat to sell their products, and over 200 million users have linked their credit cards to their account so they can shop on the app. Starbucks, for instance, launched a new social gift-giving feature within WeChat (see image). This surge in WeChat's popularity also reflects new uses of mobile technology, and how it has become a central part of the Chinese consumer's shopping process. As well as a huge number of people using social media to shop, over half of online transactions were from a mobile device in 2016.

Singles Day broke world records

Founded by the Alibaba group in 2009, this event, now recognized worldwide, broke new records with more than 17 billion dollars spent in one day. To celebrate the event, and to truly establish themselves as key players in the industry, Alibaba also hosted a Hollywood style gala, with celebrity guests like the Beckhams in attendance, and an interactive runway show. The event was focused on new technology, with the unveiling of Buy +, which allows consumers to shop in virtual reality. According to the General Director of the Alibaba group, Daniel Zhang, nearly 15,000 brands from around the world took part in Single's Day, and more than 47 million customers shopped - which will certainly raise the stakes for 2017! Now that the Alibaba group clearly dominates in China, they're looking to attack the global market, with the launch of their international marketplace, Tmall Global.

China has definitely proved its potential this year - even if the opening of China to cross-border ecommerce is still recent and still subject to adjustments by the Chinese government, there's an ever increasing demand for foreign products from the Chinese middle classes, which gives a very lucrative business opportunity to retailers, that they should definitely start taking advantage of in 2017.

About the Author

After spending eight years living in China, Betty Touzeau came to Lengow to oversee business in China in 2016. Bilingual in Mandarin, she was a company manager in China, then a consultant to help European companies establish themselves in the online market in China. She therefore holds a specialized expertise of the Chinese market, especially in the ecommerce sector.