China: the most valuable social commerce market in the world?
A new report by Boston Consulting Group (BCG) claims that China could become the world’s most valuable e-commerce market within four years.
BCG claim that for the foreseeable future another 30 million Chinese people will go online to shop for the first time and by 2015 they will each be spending $1,000 a year—about what Americans spend online now.
BCG has also calculated that e-commerce could rise from 3.3% of China’s retail sales today to 7.4% by 2015. This is not just because the government subsidised high speed internet aids online shopping, but also because China’s has an expensive, inefficient ‘bricks-and-mortar‘ retail ecosystem and so a quarter of Chinese shoppers seek products online because they are not physically available in-store.
The rise in value of e-commerce in China could also impact the social commerce market as Chinese e-shoppers are big users of social media.
As Chinese shoppers are somewhat reticent to trust sellers or advertising messages they turn to online customer reviews to form their opinions and according to BCG, over 40% of Chinese online shoppers read and post product reviews online. This is twice as likely as American online shoppers and four times as likely as Indians.
So what should retailers do to take advantage of the growing social and e-commerce market space in China?
Aside from considering the value of an e-commerce presence in Chinese, brands would do well to secure their presence on sites like Sina Weibo – a Chinese social networking site with over 200 million registered users – or other Chinese social networking sites like Tencent WeiBo or Ren Ren.
Retailers may also want to think about how to start engaging Chinese audiences online, not just in terms of where to engage them, but how to engage them in the context of a wider brand and social media strategy.
And as China is accountable for a large share of share of mobile social media revenue at the moment, it seems that China could lead to some interesting new online revenue streams in terms of both e-commere and social commerce, as well as mobile shopping.
You can read the full BCG report here.
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