Success factors of the eCommerce in China

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Success factors of the eCommerce in China

08.11.2019 / News

by Jörg Pütz

Due to the increasing stagnation of the economy and the limited capacity of craftsmen in Germany, many companies are wondering how further growth can be generated.
Adjusting the methods to generate further growth can be seen either on the customer or the performance side. On the customer side, growth is possible through new target groups, customer segments, countries or by intensifying business relationships with existing customers. On the performance side, innovations, portfolio expansions and consistent maintenance of the existing product range is key.

For many companies an increased internationalization has been a proven growth strategy for decades as well as a risk minimization in order to become less dependent on individual markets.
Speed and customer experience become more and more decisive competitive advantages and the digitalization enables new possibilities for reaching potential customers. So the eCommerce also plays an important market development role in sectors with traditional dealer structures.

For many years, the chinese market has been one of the main pillars of further growth for many companies. However, many of them rely on the well-tested home market distribution systems. Thus a distribution via eCommerce does not fall in this category oftenly. But the eCommerce plays an important keyrole in the chinese market. While in Germany the share of eCommerce in the total trade accounts for about 9%, the share in China in 2019 is about 37%, more than four times higher. The growth rates until 2023 are significantly higher: eCommerce in China is growing with a growth rate of 27% three times faster than in Germany. The platform Tmall of the Alibaba Group and JD.COM account for approximately 80% of all eCommerce transactions. Success in eCommerce usually only leads to these two platforms. This is not the only success factor for an eCommerce business in China. In total, we identified nine success factors for eCommerce in China. These range from the right strategic leadership role to the operational topics in logistics. A holistic consideration of these success factors is key to successfully participate in the growing eCommerce share in one of the most important growth countries of the next decades.

What are your experiences with the eCommerce in China?
Do you have a powerful eCommerce strategy in China for the future?

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