Due the growing of the e-commerce in China, many companies decide to penetrate into the Chinese marketing through e-commerce platforms.
International companies are considering whether doing their market entry via e-commerce platforms instead of physical stores.
Thanks to the economy boom in China, incomes disposable rising, the growth of a Chinese middle class and the internet and mobile penetration, e-commerce has become a powerful tool in China.
E-commerce in China has rapidly growth. In 2009, the e-commerce represented 3% of total retail while in 2014 it’s expected to reach 15.4 % which mean $409 billion.Last year, the e-commerce in China has overtaken the e-commerce in U.S.
Over the last years the shopping landscape has enormously changed in China. Now, shoppers don’t go to the stores, instead of that, they prefer shopping online where they don’t have to wait long queue for purchase.
In addition, another advantage of e-commerce platforms is that consumers have access to more products and brands, especially to International brands.
It’s a fact that e-commerce has involved an advantage for consumer, but what mean for brands?
For brands, the boom of the e-commerce has implicated the chance to reach to the whole Chinese population in an easy way and also companies have seen their sales increase.
But this is not all. Thanks to the e-commerce, companies which have no presence in China have the possibility to penetrate into the Chinese market without the necessity to open stores and without massive risks.
Also, small niche brands with presence in China which only have few stores in China, have launched online stores in order to expand their brand, instead open new stores, which is very costly.
Xiaomi, a mobile device maker, is the best example of the e-commerce power in China. The Chinese brand has became in the largest smartphone maker in China by selling its items online.
As a result of the importance of Chinese e-commerce, multinational brands have to consider whether doing their market entry through e-commerce platforms or by the traditional way.
O2O is a great way for being successful in China
For example, Topshop, the British fashion retailer has entered to the Chinese market via ShangPin.com, an online retail platform. Topshop has debuted in China in an explosive way. The event launch was in Beijing and when the guests arrived to the venue they found an empty shop. To the contrary, guests had to purchase through e-commerce by scanning QR codes which were located in the venue.
Through ShangPin.com, Topshop can reach to the Chinese consumers and understand what they want before open a physical store.
Despite the facilities of e-commerce, there’s still much to do in marketing terms. For instance, Topshop has located their brand on Shanghai buses and in its launch in Beijing counted with 5,000 people among which was the singer Wang Luodan. During its launched, Topshop received 250,000 visits on their mobile store in 48 hours.
Costco is another brand which has penetrated in China via Tmall, an online e-commerce platform. Its success is based on the growing desire of Chinese consumers for imported food and care products.
From e-commerce platforms Chinese population are able to buy everything that they can imagine and from any place of China, that’s why e-commerce is very popular. Nowadays, the Chinese shoppers behavior has changed. They are more willing to purchase online and that is the reason why many international brands prefer entered to the Chinese market through online platforms instead of physical stores, to avoid risks.
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