Keep an Eye on E-Commerce in China During The Year of the Tiger
In this recent post on The China Observer about where I see the most potential growth for businesses in China’s Internet space I wrote:
“Companies who wish to succeed in China’s Internet space would best stick to areas that focus on job creation and economic gain that do not overlap with broader social & societal challenges. The government actively promotes the online gaming industry and is a great proponent of e-commerce companies like Alibaba Group that connect people to do business and grow the Chinese economy, rather than connect them in a way to go against the government.
However areas such as Internet search, Social Networks and other online communication platforms will continue to be heavily monitored, regulated and even thwarted by the Chinese government due to the potential impacts such tools have on social interaction and unification.”
The following highlights key excerpts from Robert Olsen’s latest Forbes article, entitled “China’s Migration to E-Commerce”
· The China Internet Network Information Center said the number of internet users in the world’s most populous country jumped 28.9% in 2009 to 384 million, which is more than the entire population of the U.S.
· China’s online shopping sales rose to $36.6 billion last year and one of the reasons behind that growth has been that retailers have been able to help consumers feel more comfortable shopping online.
· Alipay has grown to become China’s biggest online payment company by processing more than 1 billion yuan ($146 million) in transactions every day. Alipay recently announced that it expects to surpass PayPal’s transaction volume within two years.
· Much of China’s e-commerce growth is being driven by younger buyers. China Market Research Group said that users in China between the ages of 13 and 28 spend 20 hours a week online on average, compared with 12 hours a week in the U.S.
With an Internet user population that out numbers the total population of the United States, effective electronic payment tools in place, and young consumers growing increasingly comfortable with online shopping – e-commerce in China will continue to be an area of immense growth in China’s Internet space.
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Comments
[...] longer shelf life, and they’re also sites that were created by Chinese, for Chinese, in China. Yes, with a total Internet population that exceeds the total country population of the United States, homegrown Chinese Internet companies can rely on the domestic market alone to achieve [...]
Another reason why it’s only a matter of time before China surpasses the US in terms of consumption.
ceo@chinafirstcapital.com