China E-commerce Market Size

China E-Commerce Market Analysis

The China E-commerce Market is expected to register a CAGR of 11.30% during the forecast period.

The primary factors driving the growth of the E-commerce market in the region are smartphone-driven M-commerce culture, innovative digital payments systems, and rising live -commerce platforms, among others.

• With a vast population, the Chinese E-commerce market is the world's largest E-commerce market. Chinese E-commerce market evolved rapidly during the past few years, primarily driven by high internet and smartphone penetration, increasing consumer confidence in online shopping, the emergence of e-commerce platforms, and the availability of various alternative payment solutions.
• Alternative payment solutions were the primary beneficiary of rising e-commerce purchases. Payment solutions such as Alipay and WeChat Pay are rapidly growing as payment solutions for E-commerce platforms. While Alipay benefits as a primary payment tool on all the e-commerce platforms owned by the Alibaba group, WeChat Pay, which is offered by Tencent, leverages its massive social media user base to push online payments. As Chinese customers continue to embrace e-commerce, these payment solutions are further expected to gain momentum.
• Furthermore, an inconvenient and often confrontational in-person shopping culture helped motivate shoppers in the region to embrace the straightforward reliability of E-commerce platforms, mainly the ease it offered in various shopping activities for making returns and securing refunds for online orders. Moreover, the supply of low-cost delivery services provided by China's millions of migrant laborers enabled companies like JD.com and AlibabaGroup to provide same-day delivery anywhere in the country.
• However, stringent rules and regulations related to local E-commerce law and Intellectual Property Enforcement for E-commerce platforms can create problems for E-commerce companies which can hamper the market's growth. For instance, the E-Commerce Law in China is designed to address rampant online infringement of intellectual property rights. The law included requirements related to notice-and-takedown mechanisms for the region's e-commerce platforms. The notice-and-takedown tools allow individuals to request that platforms take down links offering products that infringe on established IP rights. As different E-commerce platforms have varying procedures for accepting takedown notices, E-commerce companies in the region must familiarize themselves with takedown procedures for various e-commerce platforms.
• The COVID-19 outbreak has further driven e-commerce activities in China, as concerned consumers are increasingly using the online channel for their purchases to avoid getting exposed to the disease. Although the COVID-19 pandemic decreased overall consumer spending, it has resulted in growth in e-commerce purchases. While sectors such as travel and restaurant services were affected due to lockdown across the country, strong growth is seen in online purchases of groceries and physical goods.