Over the past decade, China’s e-commerce landscape has grown in leaps and bounds. Around 10 years ago, China accounted for less than 1% of the global e-commerce market; today, that share is a whopping 52%. China is such a huge player in e-commerce, it now handles more transactions per year than France, Germany, Japan, the UK and the US combined.
Image: eMarketer/The Economist
This robust e-commerce landscape represents a huge opportunity for foreign brands wanting to break into the Chinese market. But such also poses difficulties – with hundreds, perhaps even thousands, of e-commerce sites on offer, and new ones cropping up all the time, where do you start? To help you get a feeling for the main players in the Chinese market, we have identified nine online shopping sites currently dominating China’s e-commerce landscape.
The undisputed reigning champion of China’s e-commerce landscape, Alibaba-owned Tmall dominates the online retail B2C market, boasting with its counterpart Taobao a market share of nearly 65% and well over 700m active users.
Tmall’s global presence is also huge - it is the world’s second biggest e-commerce website, claiming 28% market share.
Selling everything from clothing to electronics, appliances and even cars, Tmall is focused on offering authentic, high-quality goods. It undertakes significant efforts to combat counterfeit products, making the platform highly trusted by consumers.
Tmall Global is the sub-platform via which foreign companies sell directly to Chinese consumers, although this comes at a price for brands because they must meet stringent criteria to register their account and pay relatively high fees in order to appear on the platform.
Another feature within the Tmall/Taobao ecosystem is Weitao, a social e-commerce function that has been gaining momentum over the past few years particularly as Key Opinion Leaders (KOLs) and social e-commerce have grown in popularity.
Also known as Jingdong, JD.com has a relatively large slice of the online shopping pie, with a market share of around 26% and around 420 million active users.
The number two e-commerce behemoth sells products from a huge range of categories, such as fashion, electronics and health, but it is also steadily gunning for a bigger piece of the market-share pie, branching into categories with little or no coverage by the other big e-commerce players in areas including travel, fresh produce and industry
JD.com also boasts its own delivery network covering 99% of China’s population, meaning even customers in rural areas can enjoy fast and seamless delivery – an important consideration for brands that have rural consumers amongst their key demographics. Similar to Amazon, third-party vendors can utilise JD.com’s logistics network for order fulfilment, giving it a further edge over its competitors.
And JD.com shows no signs of slowing down. It is also working on cutting-edge technologies, such as AI, robotics and drones, in order to further improve the customer experience, which promises to make it more competitive in the months and years to come. Similar to WeChat, it has begun offering mini-programs that act as an app within the app, meaning businesses can offer specific features highlighting their brand and that speak to their consumers.
Founded in Shanghai in 2015, Pinduoduo has taken the Chinese e-commerce world by storm, snapping up 13% of the Chinese e-commerce landscape to become the fastest-growing app in China’s history.
Unlike major competitors such as Tmall and JD.com, which focus on premium products, Pinduoduo is targeted at bargain hunters looking for a great deal. What makes Pinduoduo unique is that it is primarily focussed on social e-commerce. The interactive “group buy” or “team purchase” model allows users to invite friends to join a shopping team. This social nature of the platform encourages product virality – the more people buy a product, the more it is discounted, and the higher the product is ranked, further driving sales.
This is a great platform for lesser-known brands to spread awareness as there is less premium placed on branding and more on cost competitiveness. It’s also worth mentioning that Pinduoduo’s key demographics are largely from third- or lower-tier cities and mostly senior citizens.
Xiaohongshu - “Little Red Book” (小红书
Originally created as a platform for users to share their experiences with make-up and skincare, Little Red Book expanded over time into other areas such as sport, travel and food.
Sitting at nearly 300m active users, comprising 6% of the market, Little Red Book’s strong luxury-brand focus promises users the opportunity to buy international brands previously off-limits to Chinese consumers.
In a similar vein to Instagram, it is also a form of social e-commerce in that users scroll through images until they find one that interests them. Clicking on the image then takes them to an e-commerce shop to fulfill their purchase. Very popular among young women, it is also highly frequented by KOLs - even Kim Kardashian is on the platform!
With a strong social media component – users are encouraged to share reviews and tips – Little Red Book could be a great way to grow brand awareness, particularly if you also harness the power of key opinion leaders (KOLs). If you have a high-quality product aimed at females aged 30 or under, consider adding Little Red Book to your marketing strategy.
Originally launching as a gateway for Australian products into China, Kaola has expanded to become the largest Chinese “Cross-border e-commerce” (CBEC) platform, estimated at having over a quarter of the CBEC market.
Bought by Alibaba in 2019, Kaolo remains an independent platform at present, although there has been some talk of it eventually being integrated with Tmall Global in the future.
Currently working with 8,000 brands from 80 countries, Kaolo offers a broad range of authentic products consumers buy directly from brands. Importantly, in reliability surveys, Kaolo has been top ranked alongside Amazon.com and Xiaohongshu.
Also known as Wei Pin Hua, Vipshop is one of China’s leading online discount retailers, selling products from over 1000 brands in categories like fashion, home and beauty at heavily reduced prices for a limited time.
Its focus on premium and popular brands, quality products and good customer service has given it a good reputation among consumers, and its membership program, Super VIP, has managed to breed high customer loyalty by offering exclusive deals.
A shifting focus to luxury brands in recent times, however, could mean that less-established brands will find it difficult to get a foothold on this platform.
As one of the largest non-government retailers in China, Suning currently sits in the top four online shopping sites with its market share of 7% However, this has flatlined over the past few years as other players have come into the space.
Part of this could be attributed to Suning’s perception as a particular kind of retailer. It’s more than 1600 brick-and-mortar stores are limited in terms of range of products, chiefly selling electronic appliances. However, their online store sells a wider range of products, including books, beauty and maternity.
This strong offline presence, however, and Suning’s brand being largely associated with electronic appliances in the minds of consumers means that if your brand falls into this category, Suning is still a platform to seriously consider.
China’s answer to Amazon, in the same was as its US counterpart, Dangdang began as a book retailer before branching into many other categories, such as beauty and personal care; home and lifestyle; baby, children and maternity; and electronics.
Even with this diversification Dangdang remains the largest book retailer in China and is heavily associated with this category.
According to Dangdang’s cofounder Penny Yu Yu, “Dangdang caters to medium- to high-end customers with higher-than-average education level and larger wallet size and they tend to live in top 20 cities.”
If this sounds like your demographic, and your product is of the educational or entertainment persuasion, Dangdang could well be worth exploring.
If you are in China and need groceries but don’t feel like making a trip to the supermarket, you’ll likely turn to Yihaodian, the largest online food shopping site in China.
Here you can find most products available at major Chinese supermarkets, such as fresh produce, healthcare products and appliances. Yihaodian’s clientele tends to be affluent, with imported products such as wine enjoying premium billing on its homepage.
Bought outright by Walmart in 2015, a year later JD.com purchased Yihaodian, meaning over time, it will benefit from technological developments that will improve supply chain logistics.
With its ever-growing range of e-commerce platforms, China offers many options for foreign companies wishing to sell their brands into this huge consumer market.
Starting out with one of the large operators, such as Tmall or JD.com, is probably the best option when entering China’s e-commerce ecosystem, but understanding the nuances of the other platforms detailed above may steer you in different directions that better suit your brand and key demographics.