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China to be World Leaders in E-Commerce Retail Business

E-commerce may have originated from North America, the United States to be precise but is getting its fame elsewhere in the 21stcentury. With sales over 900 Billion this year, China represents half of the world’s digital retail sales online. It is predicted that as the rural areas get access to the internet the digital shopping trend will continue and will grow bigger. According to eMarketer the Asian region for digital sales will grow by 31.5% and will hit one trillion marks this year alone. Which makes Asia number 1 market for retailers. It is also expected that China will surpass US to become world’s largest retail market, with sales of over $4.886 trillion, compared to the average sum of $4.823 trillion in the US.

The Asian market is booming as the income of the people is increasing in the rural places and people are willing to spend more than ever. By 2020 it is expected that the digital sales will rise more than twice, that is $ 2.725 trillion from $ 1 trillion marks now.

According to the industry expert Monica Peart, director of forecasting for eMarketer, the E-commerce retail industry of China is built mainly because of 3 companies namely: Alibaba, Tmall, and JD.com. These are the 3 companies which took advantage of the country’s undeveloped traditional retail infrastructure positioning themselves well to capitalize on growing consumer demand by creating their own payment system and logistic services. An example is Alibaba who has their own Alipay and JD.com has its own logistic operation services.

Another main reason for the growth in the digital sales is smartphones. Right now in 2016, it is seen that close to 55% of people buy via smartphones and this number is expected to go up to 68% by 2020. Asia is expected to be a huge market for retail companies as the countries like China, India, and Indonesia has the digitally-savvy population growing with growing disposable income.

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Source: http://www.emarketer.com/Article/China-Eclipses-US-Become-Worlds-Largest-Retail-Market/1014364

Image: http://www.pymnts.com/news/2015/chinas-2t-ecommerce-market/