Ecommerce companies following a B2C model are working within a very lucrative market in China. The ecommerce market in China was worth $34.81 trillion in 2019, according to data published by Statista. The number of online shoppers in China has increased exponentially over the past decade — from 108 million in 2009 to roughly 750 million in 2020. This has given B2C companies in the ecommerce market ample opportunities to expand their growth and reach in recent years.
Leading vendors highlighted by the Research and Markets report include Alibaba Holding Group, Amazon.com, E-Commerce China Dangdang, GOME Retail Holdings, LightInTheBox Holding Co., Rakuten, Sun Art Retail Group, Suning Holdings Group, and Vipshop Holdings. The market is fragmented with several key players involved and was dominated by apparel sales in 2019.
As noted above, the market is projected to grow a whopping $3.851 trillion between 2020 and 2024. This amounts to a compound annual growth rate (CAGR) of 31% during the forecast period, which is a massive amount of projected growth.
Factors Driving Growth
A number of industry and cultural changes are projected to drive growth. One such factor highlighted by the report is an increase in internet and smartphone penetration. More people online means more online shoppers, which will be good for the B2C market. Furthermore, the roll-out of better technology for ecommerce vendors and improved customer service will play a role, says the report, emphasizing “free shipping and unproblematic return policies, and easy payment options.”
The coronavirus pandemic has not had a consistent effect on companies in the B2B ecommerce market in China. The report notes that while some industries have remained unscathed and have actually benefited from new growth opportunities, others have registered a drop in demand, which may linger as the pandemic drags on. Overall, the report concludes: “Covid-19 will have a high impact on the business-to-consumer e-commerce market in China.”
With strong growth projected over the next few years, this sector of China’s ecommerce market appears to have promising opportunities for entrepreneurs and investors in store. However, it’s important to keep an eye on how the coronavirus pandemic is impacting industries, as it doesn’t seem that the potential benefit — or toll — on this market has been fully calculated yet.
About the Author
Jemima is a journalist who enjoys reporting on business, particularly small business and entrepreneurship.