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Classified in: Science and technology, Business
Subjects: SVY, ASI

Study: Retailers Seek Closer Connections to Chinese Consumers


NEW YORK and HONG KONG, May 14, 2018 /PRNewswire/ -- Over 80% of surveyed U.S. and foreign retailers see China as a lucrative market, as affluent Chinese consumers seek quality products from overseas. However, only 20% of retailers feel confident in their capability to succeed in China's e-commerce market, according to research report The Cross-border eCommerce (Haitao) Opportunity in China released today by leading consulting firm Frost & Sullivan, in partnership with China retail strategy expert Azoya Consulting. The survey focused on mid-size and large retailers with annual revenue of over US$50 million; 36% of the retailers earn annual sales of more than US$1 billion.

"This is the first report globally to review the Chinese cross-border e-commerce market from both consumer and retailer perspectives," said Mark Dougan, Consulting Director, Asia-Pacific, Frost & Sullivan. "By understanding consumers' behavior and needs, and retailers' current situation, the report provides new insights and strategy guidance for international retailers who want to succeed in the online shopping market in China." 

With 500 million online shoppers, China is on track to exceed US$1 trillion in online sales this year. In recent years, China has experienced a 40% annual growth rate in the value online shopping. The report's key takeaways include:

Factors influencing cross-border purchases include Chinese consumers' expectations of a range of payment options and efficient website performance for a seamless customer experience.

Among retailers, only 37% currently feel satisfied with their online sales in China using a global e-commerce vendor, 31% feel satisfied with their standalone online store and 21% feel satisfied with sales through online marketplaces, such as those owned by Chinese giants Alibaba and JD.com. Marketplaces' crowding, intense price competition, margin-eroding commissions and high upfront costs have led more foreign retailers to create standalone Chinese websites to gain direct customer access, greater control and higher net margins.

As a result, retailers are looking beyond marketplaces as their only approach to consider, especially if these companies have a long-term sales strategy in China. "To build a brand that Chinese consumers trust, which commands a healthy profit margin and repeat buyers, retailers need to approach customers through multiple touchpoints. The key channel should be within retailers' control, accompanied by supplementary platforms," said Don Zhao, Co-Founder of Azoya International. "More and more retailers are establishing standalone websites as the core of their strategies, as these sites directly connect retailers with Chinese consumers who desire foreign brands, while empowering retailers with flexibility and control over their business."

To succeed in China, the report suggests international retailers should focus on basic e-commerce capabilities, including efficient digital marketing, local logistics networks, a range of payment options, Chinese language customer service and content. In addition, retailers need a robust social media strategy, including partnerships with influencers or key opinion leaders (KOLs), and understanding market trends to reach and engage Chinese consumers.


About Azoya Consulting
Azoya Consulting empowers international retailers with clear and actionable China e-commerce strategy powered by data, research, expertise and business intelligence. With over 5 years' experience in e-commerce to China, Azoya consultants help dozens of international retailers build successful business cases with China entry strategy, e-commerce operation guidelines, digital marketing strategy, O2O strategy, logistics and supply chain. Azoya Consulting is a subsidiary of Azoya International, a borderless e-tailing group that assists international retailers as they expand to China via e-commerce. Learn more at www.azoyagroup.com

About Frost & Sullivan
Frost & Sullivan, the Growth Partnership Company, works in collaboration with clients to leverage visionary innovation that addresses the global challenges and related growth opportunities that will make or break today's market participants. For more than 50 years, we have been developing growth strategies for the Global 1000, emerging businesses, the public sector and the investment community. Is your organisation prepared for the next profound wave of industry convergence, disruptive technologies, increasing competitive intensity, Mega Trends, breakthrough best practices, changing customer dynamics and emerging economies? Learn more at http://www.frost.com

Dan Dyer
U.S. Media Relations
Azoya - http://www.azoyagroup.com/
513-478-7818 (O/M)
[email protected]

SOURCE Azoya


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