China, already known to have the largest Internet population in the world, can now claim to be the world’s next e-commerce superpower. With the second largest population of online shoppers–148 million people, compared to 170 million in the United States–the country’s consumer trends and behaviors are shaping a fast-growing and unique e-commerce environment.
According to recent research by global management consulting firm Boston Consulting Group (BCG), China’s e-commerce market is expected to grow alongside the exponential growth of online shopping through 2015. While consumerism is already big in China, the Internet is also affordable and readily available, thanks to the government’s attempts to modernize the country’s telecommunications infrastructure, setting the stage for exponential growth.
By 2010, China had 457 million Internet users, with 51% in urban areas and 18% in rural areas. By 2015, the number of e-commerce shoppers will rise drastically, growing from 148 million people to 356 million people. Nearly 40 million consumers are expected to shop online for the first time every year until 2015. E-commerce will go from representing 3.4% of total retail value in 2012 to 7.5%.
“Our projection means that China will surpass the United States to become the largest e-commerce market in the world, achieving a compound annual growth rate of 38%, to reach more than RMB 2 trillion,” states BCG.
Chinese companies that have been quick to respond to the growing pool of online consumers are already reaping benefits. Vancl.com has become one of China’s top ten casual brands while selling exclusively online. The companies expected sales for 2011 quadrupled those of the prior year at RMB 8 billion. Companies that have been slow to respond will suffer in the already competitive market.
Retailers should add this information to the long list of benefits of successful e-commerce trading and the growing importance of an online presence over the next few years. Ensuring a quality customer experience online will only increase profit margins, as shoppers continue to gravitate to the web and away from brick and mortar stores.
According to recent Global Lifestyle Monitor Survey carried out by the Cotton Council, 44% of people in the UK go online at least once a month or more to purchase clothes, with 3% shopping online on a daily basis. The amount of people who buy the majority of their wardrobe online stands at 13%, up from 3% in 2010. 42% of UK consumers use the Internet to compare products and price points while 33% go online to browse the latest trends. This marked uplift of online shoppers will make or break today’s retail powerhouses, depending on their ability to quickly adapt to the trend.