Story:
Ecommerce Opportunities Due to the Income Growth of Chinese Middle Class

The rise of the Chinese middle class is proving to be a driver in the global economy. Increased affluence and mobile technology are giving Chinese consumers more connected buying experiences. 

They are using social media platforms to learn about products and instant messaging services like WeChat to share opinions about products and post reviews. The consumption boom is not only creating new opportunities in the domestic market, but affecting global demand and prices for a variety of products. 

The middle class has a preference for e-commerce

Middle-class consumers in China make purchases to improve their social image and they are very brand conscious, particularly when purchasing luxury products. This class may not be homogenous in its brand preferences but it is united in one aspect – its preference for e-commerce. Connected consumers in China are more likely than any of their peers globally to voice their preference for online shopping. 

Consumers prefer conducting their e-commerce with online marketplaces like Tmall rather than department or specialty store websites. This offers a great opportunity for companies who want to launch on Tmall. Using the Tmall agency wpic.co allows them to get their brand running with minimal downtime so they can start driving revenue.

Many sophisticated, young shoppers

Companies need to understand the preferences and purchasing patterns of Chinese middle-class consumers due to their expanding role in both domestic and global markets. Those selling directly to Chinese consumers have to tailor their marketing and sales strategies accordingly. 

For example, online shoppers tend to be well educated, young and live in cities. These young shoppers want personalized shopping experiences and the option to pay in different ways. They have a freer attitude towards spending than older generations who were savers due to their challenging circumstances, both politically and economically. 

Numerous offerings on many devices

A significant portion of online shopping occurs on mobile devices. Some shoppers will use two or three apps to do their online shopping, while others will use as many as five different apps. 

Multi-device users shop even more than those who use only mobile phones so they represent a significant source of revenue. They shop in more categories and interact more with businesses through social networks. Intelligent retailers that tap into multi-device users are likely to gain a higher market share. 

An untapped market in low-tier cities 

Low-tier cities in China still have an untapped market of internet users who have not yet become accustomed to online shopping. This presents an opportunity for retailers as competition is very high in the high-tier cities. 

Online retailers are beginning to expand their logistics infrastructures and services so they can reach consumers in these areas more effectively. 

Increase in cross-border shopping

Chinese consumers supplement domestic purchases with cross-border purchases, especially if items are too expensive or difficult to obtain in China. Consumers in higher-tier cities will use e-commerce to purchase certain healthcare products like supplements, while those in low-tier cities often purchase luxury goods. 

Middle and upper-class consumers will buy clothing and gadgets that aren’t yet available in China. Chinese consumers prefer to purchase certain goods, such as pet food and diapers, from foreign suppliers than local ones. 

Changes in government regulations

Many of the government’s current policies are to increase domestic consumer spending and decrease reliance on exports. This includes an increase in cross-border e-commerce by the setting up of e-commerce zones in cities where foreign companies can store goods, so they can ship more quickly. 

The Chinese government is facilitating the development of cross-border e-commerce by simplifying and reducing import taxes on goods.