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Cross-border e-commerce rising rapidly

Fan Feifei
Updated: Dec 27,2017 10:07 AM     China Daily

Employees sort express packages after Singles Day, an annual online shopping gala in China on Nov 11, in Donghai, Jiangsu province. [Photo/China Daily]

Zhang Jie, 29, an office worker from Shenzhen, Guangdong province, is passionate about cosmetics and fashion products. She often browses Red, known in Chinese as Xiaohongshu, an overseas shopping tip app to get information about fashion and shopping before she buys overseas brands and products.

“I like reading interesting shopping stories, product recommendations and buying tips, even though I don’t have overseas travel plans on my schedule,” said Zhang, adding she would buy products from Red directly.

Shanghai-based e-commerce startup Red was set up in 2013 to connect Chinese consumers with overseas sellers, creating a community of trust and sharing, with more than 70 million users by the end of October.

It initially began with the objective of helping Chinese people traveling abroad share their shopping experiences online before morphing into a social commerce site selling international luxury brands and sought-after foreign products.

The company relies on word-of-mouth marketing, and lets its users share photos of products they bought, purchase tips and overseas shopping stories online.

“We hope to resonate with the ongoing consumption upgrade in the country, as people pay more attention to quality consumption,” said Qu Fang, co-founder of Red.

It has inked partnerships with Cosme, Japan’s largest online cosmetics shopping site, and Kirindo, the largest drugstore and pharmacy chain in Japan. About 80 percent of its users are younger than 30 years of age and 90 percent are well-educated women pursuing high-quality lifestyle.

China’s cross-border e-commerce sector has been growing exponentially over the past few years as the demands of the country’s middle-income shoppers are becoming increasingly diversified and personalized.

Apart from Red, other online retailers are wooing a large number of affluent Chinese consumers with a wide range of authentic and high-quality overseas products.

“The demand for international brands is rising rapidly, thanks to cross-border online shopping, which is probably one of the fastest growing trends in e-commerce,” said Elaine Chang, president of Amazon China.

Amazon is luring a rising number of Chinese buyers to purchase foreign products with its Amazon Global Store, which covers top destinations of Chinese customers’ cross-border shopping, including the United States, the United Kingdom, Japan and Germany.

Amazon said Chinese consumers would enjoy authentic deals from overseas markets and be able to purchase authentic products directly from Amazon’s overseas fulfillment centers. The products cover the most popular items including Nine West shoes, Godiva chocolates, Lego blocks and Rimowa luggage.

China’s cross-border online shopping grew 23.5 percent to 6.3 trillion yuan ($953 billion) in sales last year, according to iiMedia Research, a market consultancy.

Market researcher eMarketer estimates by 2020, a quarter of the Chinese population, or more than half of China’s digital buyers, will be shopping for cross-border products, either directly on foreign-based websites or through third parties.

Shanghai-based provides a more diversified cross-border shopping service.

“With users’ demands becoming more and more personalized and diversified, not only more high-quality goods are needed, all-around services are also necessary,” said Zeng Bibo, chief executive officer of Ymatou.

The company recommends products with excellent quality and reasonable prices to customers by utilizing big data technology and analyzing commodity sales, user ratings, brands influence and price information.

Chen Tao, an analyst with the Beijing-based internet consultancy Analysys, said, “E-commerce platforms hope to seize the opportunities emerging from the consumption upgrades of Chinese consumers.”

Chen added that compared with Amazon, domestic online retailers have a better understanding of local consumers’ need and how to operate in accordance with local market conditions.