3rd February 2022

The year of the Tiger: China’s e-Commerce in 2022

Happy Chinese New Year! The year of the tiger in the world’s second-largest economy will be all about digital. Since the pandemic started, Chinese retailers have shown how technological tools can be used to be closer to consumers, and the rest of the world is paying attention and following the lead.

China has 782 million online consumers and, more specifically, 932 million mobile internet users. Besides, over 90 per cent of e-commerce sales are done through mobile devices, representing 99.2 per cent mobile internet penetration.

And why is it important to know what is happening in the Chinese e-commerce landscape? Thanks to being one of the most populated nations globally, many of the new trends that shape e-commerce worldwide are generated in China.

Alibaba has been using Artificial intelligence and big data to respond to customers’ queries, offer personalised product recommendations and automate delivery services for some time now. In addition, the company recently launched Hey Box, a go-to service for consumers to discover newly launched products on Tmall, Alibaba’s B2C e-commerce platform. 
 

We live in a digital world. 

 
There’s no doubt that Chinese influencers and creators know how to use social platforms. For example, on the first pre-sale day of ‘Double-11′ (11.11) in 2020, two of China’s most prominent creators, Wei Ya (also known by Viya) and Austin Li Jiaqi, made sales worth more than 600 million pounds. 

At the same time, the virtual world is also a place to sell and connect with consumers, and Chinese e-Commerce is pushing boundaries by creating virtual influencers, avatars sporting luxury accessories and giving away NFT’s after a purchase. Last November, Alibaba introduced its first “Metaverse Art Exhibition,” including pieces by Burberry, Alienware and Xpeng.

Virtual realities seem to be more approachable than ever when it comes to travel and tourism. It is expected that the Olympic Games Beijing 2022, the world’s largest sporting event, will be the most digital edition yet, with live-streaming and virtual reality at the front of the competition.
 

The KOC marketing

 
KOC stands for “Key opinion consumers”, which are regular buyers who create videos to share their product reviews and recommendations. This new trend is getting momentum after the Chinese government decision to regulate influencers’ activities on social media. So, relationship-based marketing is on the rise.

In this matter, short video apps are also gaining popularity among Chinese consumers, with more than 300 million users. According to recent studies, areas with middle and higher-income households and audiences under 35 years old are more drawn to this type of content and platforms.
 

WeChat

 
Paid advertising is becoming too expensive for some Chinese retailers due to high volume and competition. This is why brands are looking for new alternatives to stay in touch with their users.

WeChat is one of the leading apps in China with 1.2 billion active users, and more than 50% of its age demographic are users under 30 years old. WeChat allows users to pay, play, chat, shop, order everyday services and products, and 80% of Chinese consumers use WeChat Pay for online payments.

More recently, brands and retailers have started to set up exclusive groups on the app to talk directly with consumers and establish connections with prominent influencers and KOCs.
 

Expectations for 2022

 
Based on what experts are saying, the Chinese e-commerce landscape will face a recession in 2022. Since November 2021, the increase in retail has slowed down by 3.9%, and the market will face some challenges due to government regulatory policies. 

However, according to the report China Community E-commerce Market: Size, Trends & Forecast with Impact Analysis of COVID 19 (2021-2025): “The market would rise in the next four years, i.e. 2021-2025 tremendously. China e-commerce market is expected to increase due to the growing internet and mobile payment penetration, increasing use of smartphones, growing lower-tier population, and vast logistic support.”

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