Res­i­dents of ma­jor cities love e-shop­ping, sur­vey says

With China poised to over­take the US this year as the world’s largest e- com­merce mar­ket, ur­ban res­i­dents are shop­ping online and buy­ing more, re­ports He Wei in Shang­hai

China Daily (Hong Kong) - - FRONT PAGE -

Online pur­chases have be­come the first choice among shop­pers in first­tier cities, ac­cord­ing to a sur­vey of taxi pas­sen­gers.

China Daily con­ducted a poll of 134,026 peo­ple by team­ing up with Touch­me­dia, the na­tional leader in me­dia pre­sen­ta­tions in taxis, from Dec 1 to 9. Fiftytwo per­cent of the taxis in­volved in the sur­vey were in Shang­hai, with oth­ers in Bei­jing, Guangzhou and Shen­zhen.

More than two- fifths of the Chi­nese na­tion­als who re­sponded to the sur­vey cited e-com­merce sites as their top choice for shop­ping. Th­ese in­cluded online mar­ket­places such as Tmall and Taobao, busi­ness- to- cus­tomer sites such as JDMall and of­fi­cial brand web­sites.

For­eign res­i­dents in China are less in­clined to em­brace online shop­ping. About onethird of the ex­pa­tri­ates liv­ing in Shang­hai said they pre­fer brick-and-mor­tar stores.

Among 24,218 for­eign­ers sur­veyed who live over­seas but were vis­it­ing the city, the top three shop­ping choices were con­ve­nience stores, shop­ping malls and depart­ment stores.

All re­spon­dents were al­lowed to list up to three choices, with the re­sults given equal im­por­tance and bun­dled to­gether.

About 40 per­cent of the Chi­nese re­spon­dents said they pay for online pur­chases by us­ing bank cards online or through third-party pay­ment plat­forms, in­clud­ing Ali­pay.

The fig­ure was 10 per­cent­age points lower among for­eign re­spon­dents, with 21 per­cent cit­ing cash as the pri­mary pay­ment op­tion, fol­lowed by in­per­son credit card use.

China is poised to over­take the United States to be­come the world’s largest e-com­merce mar­ket this year, ac­cord­ing to es­ti­mates from con­sul­tancy Bain & Co.

With 32 per­cent av­er­age an­nual growth fore­cast, online shop­ping ex­pen­di­ture in China is set to reach 3.3 tril­lion yuan ($539 bil­lion) by 2015, the con­sul­tancy said in a re­port.

The poll was con­ducted two weeks af­ter Alibaba Group Hold­ing Ltd achieved record sin­gle-day sales of 35 bil­lion yuan on Nov 11.

On Thurs­day, 2.11 mil­lion small ven­dors and mom-and­pop shops that op­er­ate on Alibaba’s Taobao Mar­ket­place will of­fer dis­counts to woo cus­tomers and boost sales.

Taobao mer­chants must en­sure that the prices are the low­est they’ve of­fered in the past 30 days.

More than 60 mil­lion prod­ucts will be 50 per­cent off, ac­cord­ing to Taobao data, while an ad­di­tional 1.2 bil­lion yuan in dis­counts will be dis­trib­uted in the form of dig­i­tal coupons.

Ahead of the event, Taobao has been pro­mot­ing off­beat online auc­tions, ac­cord­ing to the com­pany’s pub­lic re­la­tions team in Hong Kong, such as 684 gold bars, bricks and or­na­ments.

Also up for sale: 16 thor­ough­bred race­horses im­ported from the United States and Saudi Ara­bia.

More than 30 lo­cal Chi­nese courts are tak­ing ad­van­tage of the shop­ping event, pledg­ing to auc­tion seized goods on Taobao. Since last June, 98 lo­cal courts have agreed to dis­play con­fis­cated goods online, with 1,175 items be­ing auc­tioned via the web­site.

On Thurs­day, par­tic­i­pat­ing courts will of­fer items rang­ing from smart­phones to lux­ury cars, as well as 120 real es­tate prop­er­ties, ac­cord­ing to the com­pany. The costli­est item is an in­dus­trial plant with a start­ing bid of 51 mil­lion yuan.

Taobao will em­ploy sales anal­y­sis to help smaller mer­chants at­tract buy­ers by hand­ing out dis­count vouch­ers geared to in­di­vid­u­als’ shop­ping his­tory, said Zhang Yu, pres­i­dent of Taobao.

Down­load­ing a Taobao mar­ket­ing tool en­ables ven­dors to iden­tify pop­u­lar items and pro­vide dis­counts to en­tice con­sumers.

The soft­ware has been in­stalled by more than 1 mil­lion Taobao sell­ers since Oc­to­ber, the com­pany said. It is also dis­tribut­ing 100 mil­lion yuan cash in­cen­tives to en­cour­age the use of its mo­bile app.

Taobao will high­light prod­ucts tai­lored to cus­tomers’ needs. For ex­am­ple, el­derly cus­tomers can buy prod­ucts rang­ing from heated un­der­wear to nail clippers equipped with mag­ni­fy­ing glasses.

The move is in line with Alibaba’s aim to have 1 mil­lion Taobao shops with an­nual sales top­ping 100 mil­lion yuan.

Be­cause web­sites suc­cess­fully feed store sales, build­ing a ded­i­cated dig­i­tal team and in­vest­ing in a world-class web­site are crit­i­cal to grab­bing a foothold in e-com­merce ter­ri­tory, said Serge Hoff­mann, part­ner in Bain & Co’s re­tail prac­tice in China.

Chi­nese com­pa­nies are in­creas­ingly em­brac­ing the use of “big data” as an ef­fec­tive mar­ket­ing tool, said Xie En­wei, chief cloud of­fi­cer at Mi­crosoft Corp’s China op­er­a­tions.

“The likes of Alibaba and Ten­cent (Hold­ing Ltd) are cut­ting-edge Chi­nese In­ter­net firms that widely ap­ply ‘big data’ tech­nol­ogy, which will set the tone for in­dus­try trends,” Xie said.

Th­ese moves will help closely mon­i­tor and an­a­lyze data to al­low in­sight­ful and timely so­lu­tions, he said.

Mi­crosoft, as a cloud so­lu­tions provider, has wit­nessed a surge in such cloud-based de­mand, no­tably from mil­lions of Chi­nese small and medium-sized en­ter­prises, Xie added.

Ama­zon China also sees tech­nol­ogy as its key ad­van­tage in China’s boom­ing but in­creas­ingly com­pet­i­tive e-com­merce mar­ket. “Com­pared with sales pro­mo­tions and ad­ver­tise­ments, tech­nol­ogy is what makes us stand out in the mar­ket in the long run,” said Brian Hui, vice-pres­i­dent of Ama­zon China.

The com­pany has se­lected about 500,000 prod­ucts out of the 20 mil­lion it keeps in stock to par­tic­i­pate in the 12-12 shop­ping event.

But the ma­jor­ity of the prod­ucts in­volved in the sales event weren’t cho­sen by peo­ple but rec­om­mended au­to­mat­i­cally by com­put­ers, said Hui.

He said that based on the large data­base cov­er­ing Ama­zon China’s shop­pers and the com­pany’s edge in data min­ing, the com­put­ers can pre­dict what Chi­nese con­sumers want to buy. “We then en­roll th­ese com­puter-se­lected items into online shop­ping fes­ti­vals in China. They can­not help but be a hit.”

In the Nov 11 shop­ping event, Ama­zon China saw its sales soar 300 per­cent com­pared with the 24-hour sales event last year. Meng Jing in Bei­jing con­trib­uted to this story. Con­tact the writer at hewei@chi­

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