Three Strategies To Win In China’s E-commerce Market

Recently, American retailer Macy’s (M) announced that it will launch an e-commerce site in China in 2017.  Will Macy’s follow the footsteps of other American giants such as e-Bay (EBAY), which failed miserably, or Amazon (AMZN), which couldn’t gain much footing in China?

Shutterstock

Shutterstock

For Macy’s, or any other retailer large or small, the Chinese consumer market is both enticing and intimidating. China’s e-commerce market is the largest in the world, and has been growing by double digits. However, Chinese shoppers behave differently than their Western counterparts, and market conditions are fundamentally different as well.

In order to win in China’s e-commerce market, the following three strategies are essential.

Mobile-first Strategy

E-commerce in China is fundamentally mobile. According to Bloomberg, the country has more than 1 billion smartphone users. Nearly 90% of Chinese shoppers have purchased items via a mobile phone. Many Chinese simply bypassed the PC era altogether and leapfrogged into mobile.

Since e-commerce in the West started during the PC era, many functions on e-commerce sites are PC-centric. Mobile applications often have limited capabilities and serve as a complementary tool to the full website. This will not serve Chinese consumers well. Companies must have a mobile-first strategy, redesign their e-commerce sites with sophisticated mobile capabilities , and ensure a smooth shopping and checkout experience entirely on mobile applications.

Unlike in the West, PC-based websites can be a complementary offering to mobile commerce. A recent McKinsey report indicates that people with multiple devices such as smartphone, tablet and laptop spend 17% more on e-commerce than their mobile-only peers.

Social Media Integration

E-commerce in China is pervasively social. Unlike in America where Amazon and Facebook (FB ) are largely separated, Chinese e-commerce is closely linked to social media sites such as Weibo and WeChat.

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