The State of E-Commerce in the Caribbean

The future of the Caribbean is digital. The rise of the online economy is set to grow new businesses and transform existing ones. Though the foundations of this change are strong within our region‚ growth will not just happen. This is evidenced in the field of eCommerce‚ where much progress has been made but more can still be done.


At its core, there is a key theme seen across a number of areas in regional business. It’s clear that the people of the Caribbean hold great talent and the potential to seize upon the advantages offered by e-Commerce but traditional (what we could now only call outdated) structures have limited its capacity to grow.

This issue is not confined to our region alone. That’s why even though Japan is viewed as a hyper-modern economy on the cutting edge of technology in Asia, its heavily cash-dependent economy also sees it behind the pace in some economic indicators that laud digital finance and transactions.


While other nations and regions around the world have looked to rapidly shift to a financial architecture that seizes upon the future‚ the Caribbean has been slower to create change in our banking system and practices, change that enables regional entrepreneurs and businesses to quickly and easily shift their business from bricks and mortar to online operations. Even when they do‚ greater fees or red tape can be an inhibitor to generating new ideas and enthusiasm.

More widely‚ there’s the challenge of regional co-operation. The potential for the Caribbean to grow greater trade ties and relationships within our region is considerable but shifting that longstanding potential into actionable policy is more difficult. Underpinning all this is the irony that the Caribbean is recognised as a leader of global finance (controversies in it notwithstanding).

But it is in this field that good results can be pursued on the ground floor, ones that benefit not only the billionaires who may bank in our region via a Citizenship by Investment Programme but also the entrepreneurs looking to start a new venture‚ and existing businesses seeking to go digital and build for their future.

Put simply‚ the Caribbean already leads in one field‚ so the architecture exists to build a leading advantage in the other.


E-Commerce in the Caribbean has potential but it must not remain something ‘with potential’ for too long; it will need clear and steady signs of growth for the region to capitalise on it.

The International Monetary Fund (IMF) has cited strengthening the business environment as crucial to the Caribbean’s future. Signing a new free trade deal or creating 10,000 new jobs cannot be done with the stroke of a pen but regional governments creating a more proactive culture for e-Commerce growth is more a matter of modernising reforms over gigantic changes. As progress on these reforms could occur relatively quickly, so could seeing strong results from it.

While government will play a vital role in this field‚ the real momentum to drive change will come from business. This can be an area where big and sweeping change is brought in (which chamber of commerce wouldn’t be delighted to think the next Amazon is being built in its community?) but it can also be small things.

The development of local e-Commerce content, like plug-ins, is something that could be done inexpensively locally‚ but really help build the Caribbean brand in e-Commerce regionally and globally.

Nonetheless‚ while the greatest innovation may come from the private sector‚ it’s a reality that government that will play a core role, no matter what, due to e-Commerce’s need for good infrastructure, namely electricity prices and internet speeds. It’s here that initiatives like the GO Network pilot here in Saint Lucia could not only improve our country’s digital brand in tourism but jumpstart a new era for e-Commerce.

The growth of e-Commerce in the Caribbean would also bring benefits beyond the online arena, chiefly‚ the possibility to cut through existing irritations in daily life.

H&M reveals e-commerce future

Dive Brief:

  • At its first investors event this week, H&M Group said company-wide e-commerce sales last year were SEK 29 billion ($3.66 billion, as of Wednesday) and amounted to 12.5% of the H&M Group’s total sales, according to a press release. The H&M group’s online channel is “showing good profitability,” accounting for 22% of its operating profit, according to company documents.
  • Store sales accounted for SEK 203 billion ($25.6 billion) or 87.5% of total sales, the company reported. The fast-fashion company’s new business unit, including COS, Weekday, Cheap Monday, Monki, H&M Home, & Other Stories and Arket, together provided revenue of SEK 17 billion ($2.5 billion, as of Wednesday) or 7% of overall sales.
  • Executives warned that this year would be a building year, as they turn more forcefully to the internet. They expect same-stores to remain negative, due to bloated inventory forcing markdowns. E-commerce and new brands each should grow 25%, and sales in newly opened stores should add about 4%. From 2019 to 2022, new brand sales are expected to rise by at least 25% annually, reaching over SEK 50 billion ($6.31 billion) in 2022, with online sales expected to rise by around 20% per year, reaching SEK 75 billion ($9.46 billion) in 2022.

Dive Insight:

Valentine’s Day this year for H&M was its first-ever investors day, when the fast-fashion retailer unveiled facts and figures it hoped they could love. The reveal included its online sales, which previously had been a mystery.

But CEO Karl-Johan Persson also asked for patience. The fast-fashion company last month, amid rising inventories and tanking sales, announced it’s picking up the pace on a transformation plan that involves closing stores. Fourth quarter sales fell 4% to 50.39 billion kronor ($5.97 billion as of last month) from the same period a year ago and foot traffic to stores declined. Weak sales led to increased markdowns and handling costs that hit profits, which plunged 33%. Holiday sales edged up but only slightly. For the full year, sales rose 4% (or 3% in local currencies).

H&M is planning approximately 390 new stores, along with approximately 170 store closures for a net addition of 220 stores (down from 388 last year). Its launch of new sub-brands, which in recent weeks has included Afound and millennial-focused Nyden, as well as last year’s Arket, has accelerated. Another brand is slated to open later this year. In his presentation Wednesday, Peter Ekeberg, acting head of new business, called the tactic a “proven business model” with “huge potential.”

But some analysts weren’t so sure, in light of the sub-labels’ contribution of, all told, less than one-tenth of sales, according to Bloomberg. “The offering is the core problem,” said Erik Sjostrom, a fund manager at H&M shareholder Skandia, according to Bloomberg. “The fashion, the price, the distribution and I believe they are off both in terms of fashion and price … What I’m hearing is that everything except core H&M is doing well, but it’s core H&M that’s the main business.”

PepsiCo is investing in e-commerce

PepsiCo has announced that it will be investing in its e-commerce business, which now brings in approximately $1 billion in sales annually, according to Business Insider.

The exact amount that will be invested, and how it will be employed, was not revealed, but the funds themselves will be coming from PepsiCo’s savings under the new tax plan in the US. PepsiCo already has a team of about 200 employees dedicated to its e-commerce business, and this additional investment may further their efforts.

The investment may be an effort to get better at inspiring impulse buys online. E-commerce has changed how impulse purchases are made, and with approximately 30% of beverage sales coming from impulse buys, according to Ali Dibadj, an analyst at Bernstein, PepsiCo, Coca Cola, and other competitors need to find a way to inspire more of them online.

This investment by PepsiCo could go toward developing new digital channels and innovations to give consumers new and exciting ways to buy food and drinks. PepsiCo should also consider determining the best kinds of packaging and presentation to draw impulse purchases online. Since consumers can’t feel a beverage’s packaging or see it as they would in-store, which is a driver of impulse buys, having specific e-commerce drink models or marketing could pay dividends.

With the advent of fast delivery and online grocery, food and drink consumer packaged goods (CPG) companies have a better chance of driving impulse purchases through e-commerce.

  • One-hour delivery and instant pickup lockers give consumers the ability to get their impulse buys almost immediately. One of the main drivers for in-store impulse food purchases is that the customer gets to eat or bring the products home immediately. However, it’s been difficult to replicate this experience with online sales. But with Amazon’s one- and two-hour delivery through Prime Now, consumers can get their products quickly. And Amazon’s “Instant Pickup” locations are also worth keeping an eye on, as they make online orders available as soon as two minutes after they’re placed, which would be even closer to the convenience of the in-store impulse experience.
  • Online grocery is growing fast, and consumers’ main concern barely applies to CPG, which should help such companies thrive online. Seventy percent of consumers are projected to order food or beverages online as soon as 2022, up from 23% in 2016. One of the main holdups for online grocery is that consumers want to pick their own products. Luckily for CPG companies, this isn’t as important for them, because, unlike produce, their products are more consistent and worry consumers less, which could allow them to thrive in online grocery.

China: Fresh food e-commerce booming

Thanks to the booming development of e-commerce in China, more and more people are turning to fresh food apps for their daily shopping. Data from consulting firm iResearch shows China’s fresh food e-commerce industry grew by 59.7% in 2017 to 139.1 billion yuan (22.1 billion U.S. dollars).

Among foods purchased online, fruit is the most frequently bought. Dairy products and vegetables ranked second and third, respectively. Fresh food e-commerce developed rapidly in China in 2014 and 2015, then experienced a reshuffle in 2016. However, e-commerce giants Alibaba and later reinvigorated the market by raising investments in supply chains and logistics. also opened its first off-line fresh food supermarket in Beijing in January where customers can either buy in the shop or order on its app. The company said over 10,000 customers visited the 7FRESH supermarket each day during its trial period. Wang Xiaosong, president of 7FRESH, said it planned to open 1,000 shops across China within the next five years. reports that logistics account for a large part of the cost for fresh food e-commerce businesses. The report found that 30.7% of customers hoped to receive their goods within several hours, while 28.8% hoped delivery times could be shortened to between 30 and 60 minutes.

What you should know about the state of e-commerce in Southeast Asia

The year 2017 has proved to have been a vital year for e-commerce in Southeast Asia (SEA), with Gross Merchandise Value (GMV) of first-hand goods surpassing US$10 billion, a 50 percent year-on-year growth of the SEA e-commerce market size.

The e-commerce world saw some major events shape the year. This includes the long-awaited arrival of Amazon in the SEA market, the giants of e-commerce getting stronger and stronger with Alibaba investing US$1 billion in Lazada, and’s expansion into SEA in order to compete with rival Lazada.

Yet, behind these e-commerce giants and their title-grabbing headlines, there are thousands of other e-commerce players of various industries and sizes operating across the region.

Today, affiliate platform, iPrice Group released their report on “The state of e-commerce in Southeast Asia 2017″. The report provides insights on some of the most important e-commerce metrics from the perspective of thousands of e-commerce operators from the six largest Southeast Asian markets; Indonesia, Malaysia, Singapore, Thailand, Philippines and Vietnam.

When it comes to e-commerce, SEA is a mobile-first economy. The shopping habits of users in the region centers heavily around mobile. The importance of mobile commerce in generating traffic is far greater in SEA than in all Western economies.

Mobile-commerce in SEA is rising at impressive speeds. In the past 12 months, mobile has grown on average 19 percent, now accounting for a large 72 percent of the overall e-commerce web traffic. Storming ahead is Indonesia with a 87 percent share of mobile traffic.

“In order to succeed in the market, e-commerce operators need to nail their mobile strategies,” said Matteo Sutto, Vice-President of Growth at iPrice group.

Conversion rate refers to the percentage of website visits that turn into product purchase and is perhaps one of the most important metrics for any e-commerce operator. Why? conversion rates reflect both the quality of a company’s marketing activities and the website’s effectiveness.

“E-commerce operators are spending a lot of money to attract users to their websites. But if users don’t convert, then this can be a huge cost,” Sutto said.

Conversion rates differ among merchants in the different SEA countries. According to iPrice Group’s findings, the lowest conversion rates are found in Thailand and the Philippines, perhaps due to their less advanced economy compared to other countries.

Leading the way is Vietnam’s e-commerce merchants, with a conversion rate 30 percent higher than the average. This is perhaps a curious finding, considering Vietnam is far from being the most advanced from a digital marketing perspective.

But according to Sutto, the reason for Vietnam taking the lead boils down to the opportunity for Vietnamese consumers to pay cash upon arrival of the item.

“They buy a lot, but in Vietnam, cancellation and return are the highest among countries,” Sutto said.

At the event discussing the “State of e-commerce in SEA 2017” report, Sutto suggested two ways for e-commerce players to improve their conversion rates.

1. Quality of traffic

According to Sutto, when it comes to bringing users to your site, it is not about the volume but instead, the quality – those users with purchasing intents.

“Investment in marketing activity needs to be skewed towards performance marketing,” he said.

2. Quality of the website

Having a high-quality website is a necessity in making higher conversion rates. This includes having a fast, easy-to-use website and removing the hurdles. According to Sutto, by doing this you will instill more and more trust into users, “those players who have more trust experience higher conversion rates.”

According to iPrice Group SVP of Business Development  Julian Artopé,  speed is one of the most important factors in increasing conversion rates on mobile.

“Better performance of mobile doesn’t mean you have to have an app. It might mean that you just have to have the most responsive and the fastest website. Speed is actually incredibly important on mobile when we look at conversions, how quickly does your site load?,” Artopé asked.

“Sometimes an app can actually kill this kind of flow, because firstly I have to go to the Play store and then I have to download something and [as a consumer] I am already not interested. A very simple, lightweight site may be better”.

Though mobile is bringing in the most traffic to e-commerce sites in SEA, when it comes to conversion rates, consumers prefer to use desktop. According to the iPrice report, total conversion rate of desktop is 137 percent higher when compared to mobile.

When it comes to shopping, mobile and desktop seem to have different uses structurally.

“Users structurally use mobile and desktop in a different way. You would access whatever e-commerce website on mobile whenever you have a few minutes free, just browsing around without a strong purchase intent,” Sutto said.

“However, typically when you access the e-commerce website on desktop, you tend to have a higher purchase intent and more time to go through with the purchase. So this explains why structurally, there is a big difference between mobile and desktop when it comes to conversion rates.”

For e-commerce companies, this finding suggests that mobile experience still has a lot of room to grow in order to increase conversion rates.

Another key metric for e-commerce operators is basket size, which measures the average total amount spent for every order made by customers over a defined period of time.

The basket size results are heavily correlated to the GDP per capita of each country. Unsurprisingly, Singapore with the highest GDP per capita (US$90,530) scored the highest with a basket size of US$91. This is three times higher the basket size of Vietnam (US$23) who has the lowest GDP per capita at US$6,880.

“The biggest challenge compared to digital e-commerce westerners is that in SEA, basket size is much lower. The lower the basket size, the harder it is to achieve sustainable profitability,” Sutto said.

As well as the finding that Singapore is leading the way with regards to basket size, the insights provided by iPrice also show consumers are consistently buying bigger on desktop in comparison to mobile.

This can be interpreted as an indication of shopper’s preference in making purchases on the desktop.

At what times are consumers in SEA most likely to shop? According to the iPrice Group report, the number of orders is highest between 9AM and 5PM, when people are traditionally at work or school, much to the dismay of all employers out there!

However, the exception here is Singapore, who seem to prefer evening shopping more than other countries- and who perhaps have more diligence from an office perspective.

Due to low credit card penetration in the majority of the region, e-commerce players in SEA are faced with challenges that Western markets have never dealt with. As a result, a wider range of payment solutions are offered in the region, yet payment trends differ significantly across countries. As such, this makes it difficult for merchants with aims of expanding regionally implement a one-size-fits-all approach.

Cash on delivery is a popular payment method offered by over 80 percent of e-commerce players in Vietnam and the Philippines. Another widely used method of payment in SEA is bank transfer, offered by 94 percent of Indonesian, 86 percent of Vietnamese, and 79 percent of Thai e-commerce players.

Offline point of sales seems to be a payment method most popular in Thailand and Vietnam, with 50 percent of merchants offering it. The opportunity for consumers to pay in installments is becoming increasingly popular in both Vietnam (47 percent) and Indonesia (42 percent).

The Chinese E-Commerce App Making Shopping Social

A Chinese shopping app known for offering mind-bogglingly cheap group deals has surged in popularity recently — and come into the crosshairs of e-commerce giant Alibaba, which operates online retail platforms Taobao and Tmall.

Founded in September 2015, Pinduoduo offers deals that users can share on social media. The more people buy, the lower the price. The business model means each user is constantly promoting the platform, saving the company advertising costs.

Guo Fei, an employee in Pinduoduo’s media department, told Sixth Tone on Monday that the app has served more than 300 million consumers. From July to December 2017, its average daily growth in mobile users was 1.08 million, according to Shenzhen-based data provider — well behind Taobao’s 3.29 million but just exceeding e-commerce giant’s 1.05 million.

The upstart has upset Alibaba, which on Jan. 10 named Pinduoduo in its annual intellectual property report. Alibaba claimed that many counterfeit product vendors were leaving Taobao for Pinduodou and other rivals, such as shops on social network WeChat.

Ding Daoshi, an internet industry commentator in Beijing, told Sixth Tone that Pinduoduo focuses on practical, everyday items. “It attracts customers with cheap prices and quite functional products — that’s the basic factor behind its success,” he commented.

The first product Ding purchased on Pinduoduo was a toothbrush, for less than 1 yuan ($0.16). Then he bought two bottles of cologne (11 yuan), a coconut (9 yuan), and a mobile phone dashboard mount (10 yuan) — all with delivery fees included.

“The prices are unfathomable — it’s like going back to 20 years ago,” Ding said. “You can probably imagine what the quality is like.”

Another user, 52-year-old Li Huixia from northwestern China’s Shaanxi province, also lamented the quality of the products on Pinduoduo. “I bought a down jacket, but the feathers just keep coming out,” Li told Sixth Tone. She grumbled that it took her eight days to claim a refund.

Screenshots from Pinduoduo show low-price goods, and customers using the group buy function.

Yet despite customer complaints about quality and service, Pinduoduo has become the No. 11 most downloaded free app on Apple’s China App Store. Though there are no official reports on Pinduoduo’s profits, it had 114 million monthly active users in December 2017 — overtaking Tmall’s 80 million but still far smaller than Taobao’s 532 million, according to

Data suggest that the majority of Pinduoduo’s customers are outside China’s cosmopolitan hubs. At the end of November 2017, 41.6 percent of Pinduoduo’s users hailed from smaller cities, while only 7.6 percent were from first-tier cities, another report found.

Pinduoduo’s explosive growth over the past two years is partly thanks to its strategy of targeting smaller cities and their more price-sensitive residents — or “encircling cities through rural areas,” Cao Lei, director of the China E-Commerce Research Center, told Sixth Tone, using a reference to Communist Party war tactics.

Cao explained that Pinduodou taps into its users’ personal networks to lower its advertising costs and attracts more grassroots vendors. “With many loyal consumers, and many vendors wanting to join, Pinduoduo’s business model is sustainable,” he commented. “It has a great potential to grow, as Chinese consumers love a good bargain.”

But some customers are unhappy despite the low prices. Zhang Yawen, an accountant in the eastern city of Nanjing, told Sixth Tone she joined a group order at her mother’s behest last year, purchasing a succulent for around 10 yuan.

But when the order arrived, the plants looked nothing like the picture, said the 24-year-old Zhang. Her mother wouldn’t let her throw them away but promised they would never use Pinduoduo again. “They’re still at my home, but the growth has been terrible,” she complained.

Can HKTV win Hong Kong e-commerce battle?

Hong Kong has been a laggard relative to other mature markets in the region in latching onto the e-commerce trend, but the territory is now trying to catch up as consumer shopping habits change.

Thanks to the proliferation of “smart” devices and mobile apps, Hong Kong people are now more willing than ever to shop online, throwing up an opportunity for Internet vendors.

Leading overseas online platforms, particularly Alibaba-owned Taobao and US behemoth Amazon, currently grab most of the orders, but that hasn’t stopped a local entity — HKTV — from throwing its hat into the ring, albeit on a much smaller product scale.

Aided by strong promotions and advertising, HKTVmall has now become a leading online platform for Hongkongers to purchase daily necessities.

The new business has gained enough recognition to make people almost forget about the group’s television operations.

Last week, HKTV announced that the average daily number of orders on its online shopping platforms, namely HKTVmall and HoKoBuy, was 7,600 in December, and that the average transaction value stood at HK$537.

That marked a significant jump from previous months, as the average daily order numbers for September, October and November were at 6,000, 6,900 and 7,400 respectively, and the average transaction values were at HK$492, HK$464 and HK$527.

The two online platforms served more than 477,000 customers, chairman Ricky Wong Wai-kay said at a media briefing.

Given this record, can we say that HKTV has emerged a winner in Hong Kong’s e-commerce space?

Well, such conclusion is a bit premature, and the group has miles to go before it can declare victory.

Although Hong Kong is witnessing steady growth in e-commerce, online shopping constitutes a small portion compared with traditional shopping in the physical malls in the city.

According to the government, the “percentage of people that had shopped online in the last 12 months” rose from 7 percent in 2004 to 16 percent in 2009 and to 23 percent in 2014.

The current figure should be much higher given that more online shopping platforms entered the market from 2014.

Still, it would be a lot less compared to the online shopping figures in other major markets. Online shopping penetration in the UK, for instance, is said to be at 81 percent, while in the US it is at 78 percent.

Germany (73 percent), Japan (69 percent) and Mainland China (67 percent) also beat Hong Kong hollow by a wide margin in terms of online shopping market penetration.

It is a fact that online retail is less prevalent in Hong Kong than in many other well developed economies. But that doesn’t mean Hongkongers don’t love online shopping. It is well known that many locals browse shopping websites during office hours and make purchases through office computers.

However, many of them shop on Alibaba’s Tmall or Taobao platforms or that of global giant Amazon, rather than on Hong Kong websites.

Given this, online shopping platforms like HKTVmall must recognize their real competitors are coming from different countries, from China to US to UK to Japan, and that they must step up their game in terms of service as well as product offerings.

HKTVmall has the first-mover advantage in the local e-commerce market, as big traditional retailers such as AS Watsons’ Group and Dairy Farm Group — entities that control chain stores such as Parknshop, Fortress, Watsons, Wellcome and Mannings — are yet to pump in enough resources to develop their own online shopping business. Their focus is still on traditional shopping.

That said, HKTVmall has its own difficulties, as it explores the market on a trial-and-error basis and is on a learning curve. Taking away significant business from the established big chain stores won’t be easy.

One just needs to remember the bitter experience of media tycoon Jimmy Lai who invested billions of dollars in an online shopping venture named AdMart in the late 1990s to early 2000s, aiming to challenge the dominance of Parknshop and Wellcome.

The venture collapsed after the two big grocery chains allegedly urged suppliers to boycott AdMart, and as Hong Kong people also shied away from shopping online.

Lai’s initiative, one can argue, was somewhat ahead of its time. This time, HKTVmall has avoided making a direct challenge to the big players and is, instead, focusing on getting people to change their shopping habits.

The company launched an e-commerce incubation program, aiming to help youngsters and local small enterprises to expand online retailing.

One of its key initiatives is to expand its footprint to offline by opening around 15 physical stores in selected residential areas to promote its brand directly to the community, as well as to make the outlets serve as pick-up points for online customer orders.

Such online-to-offline strategy can bring in more potential customers, such as housewives and the elderly, to try the service. The stores can make people realize that online shopping is not an abstract concept.

As Hong Kong retailers take a conservative approach towards online business, e-commerce platforms like HKTV will enjoy a competitive advantage over offline merchants in the future.

If HKTV wants to make a name and be a long-term player, it should step up efforts to build customer loyalty and encourage the shoppers to buy more frequently.

Key to this will be enhancing its delivery service, getting the products to the customers’ doors in the quickest possible time.

HKTV has invested HK$140 million on a warehouse at Tseung Kwan O to help it deal with 35,000 orders a day and to speed up the delivery service.

The investment demonstrates Chairman Wong’s confidence in boosting the online shopping business and changing the shopping habits of locals.

But the journey has just begun.

eBay to construct cross-border e-commerce zone in China

U.S.-based on-line auction giant eBay is taking new steps into the Chinese market by setting up a filiale or branch in China (Fuzhou) Fujian Pilot Free Trade Zone on January 11.

The eBay Fujian company is eBay’s first cooperation platform with the Chinese government and is eBay’s second branch company in China following Shanghai.

eBay on the same day also announced that it has teamed up with Linca Industrial (Fujian) Group Co., Ltd. to build a cross-border e-commerce industrial park in Fuzhou, capital of east China’s Fujian Province. The park will be the first industrial park with a full industry chain of cross-border e-commerce in China. It is the outcome of a proposal signed by Fuzhou City government, the Department of Commerce of Fujian Province and eBay in April 2017.

The planning area of the first stage of the park is about 30,000 square meters, comprising a logistics center, maker incubators, a talent training center as well as a payment service support center, among other services.

“Fujian sellers have always been active on eBay and offering a rich variety of products with quality services. The landing of the industrial park showed our firm faith in the huge potential of cross-border e-commerce in Fujian. We hope we can work together with local government to bring more companies and products from Fujian on eBay, and further on help them reach more consumers across the globe,” said John Lin, chief executive officer of eBay Greater China.

“We hope to stimulate the potential and vitality of Fujian, which has always been a major province of export trade, and nurture a demonstrative policy environment and ecosystem for cross-border e-commerce industry in China, ” said Liang Yong, deputy director of the Fujian Pilot Free Trade Zone.

An eBay cross-border e-commerce institute was also established on the same day. Jointly organized by the Fujian Pilot Free Trade Zone, eBay and Fujian Business University, the institute features two majors – e-commerce and international trade, along with other optional courses.

Qualified graduates will be granted a certificate from eBay and offered opportunities to work at excellent e-commerce companies in Fujian. The institute is estimated to educate 2,000 to 3,000 e-commerce professionals for Fujian every year.

From March 13 – 15, 2018, the eBay-Fujian Cross-Border E-commerce Summit will be held at the Fuzhou Strait International Conference and Exhibition Center.

The summit, boasting an area of 22,000 square meters and 1,000 booths in seven sections, will become an important opportunity for cross-border sellers to attract millions of possible clients in the Chinese market and enhance the influence of Chinese brands.

E-commerce has become a major growth engine in China. According to a report jointly released by Alibaba and Accenture, China will become the world’s largest market for buying and selling products online by 2020, with the total value of commodity sold by e-retailers to overseas consumers estimated to reach 994 billion U.S. dollars. The partnership between eBay and Fujian will no doubt be a win-win choice.

Established in 1995 in California, eBay is one of the largest, most dynamic e-commerce platforms in the world. The company has been the top choice for many Chinese companies to explore overseas markets.

Fujian is the second largest cross-border e-commerce exporting province in China and registered an annual growth of over 35 percent in cross-border e-commerce exports over the past three years. The capital city of Fuzhou is home to many manufacturers and e-commerce sellers. In the future,  Fuzhou plans to partner with global e-commerce titans including eBay and Amazon and wish to further strengthen its role in cross-border e-commerce.

The Benefits Of Expanding Your Business To Include E-Commerce

If you’re doing exceptionally well in your brick-and-mortar operation, then you might want to seriously consider expanding your business into the e-commerce sector. That said, many old-school business-minded entrepreneurs might still not trust the internet, thinking that “big brother” is watching and there’s too much of a risk of compromising secure data.

Loosely translated, this usually means that these people might not be very tech savvy and have not fully comprehended the strides that have been taken to ensure information can be transacted through a secure site that will not only protect sensitive information but also make online shopping faster, efficient and much more convenient for the consumer. This, in turn, offers you the opportunity to increase your sales. However, it can only be done if you start selling your products online. 

My Experience With Expanding To E-Commerce

I can attribute some of my success to expanding my business online. While it’s true that my spas sell a service, we also sell the products that we use on our clients. Because many of our clients travel some ways to take advantage of our services, I wanted to make it easier for them to purchase our products. I didn’t want them to take time out of their busy schedule to drive to one of our locations just to purchase a cleanser. Giving them the opportunity to purchase online provides our customers with the convenience of shopping from their own home and even through their mobile device. It can be as easy as signing up for a Shopify account within 15 minutes. Since you know your customer best, post what sells and don’t clutter your site with too many products.

E-commerce offers purchasers a casual shopping experience. My clients are not only able to peruse all of our skin care and beauty products that we have in stock, they’re also able to discover other skincare treatments we use in our spa, giving them a chance to try new skincare products. Furthermore, our e-commerce business no longer has to be local to the Orange County area.

Taking Your Business Overseas

With online access, people across the nation and even the world can purchase our line of products — and they do! Having the ability to sell our products worldwide is something that we could not be able to do efficiently without having expanded our business to the e-commerce sector. Make sure you provide content for your new potential customers. This will allow you to reach a broader audience and keep them coming back versus going to the next e-commerce store. Furthermore, we’re also able to utilize sales and marketing channels to extend our reach to potential buyers who might be interested in our products.

How China’s Middle Class Will Dictate the Future of E-Commerce

China’s online shopping sector is enjoying a period of rapid growth. According to a 2016 report from iResearch Consulting Group, a third-party internet research institute, China’s online shopping market was worth 4.7 trillion yuan ($720 billion), a rise of 2,000 percent since 2009. In comparison, online sales in the United States grew by just 150 percent in the same period.

E-commerce has grown so much faster in China than in the U.S. due to changes in supply and demand. First, the cost of doing business in China’s traditional retail sector is relatively high, due in large part to lengthy trading chains. In addition, local governments sometimes charge businesses so-called hidden tariffs on goods traded across provincial boundaries. These fees are called “hidden” because they are not outlined in official regulations, but local governments still demand “fines” from companies transporting or distributing products out of their province of origin. Sandra Poncet, a French researcher, has shown that the cost of doing business across provincial lines in China is almost as high as cross-border trade in the European Union, and that between the U.S. and Canada.

However, e-commerce allows online shop owners to deal directly with consumers, thereby cutting out the middlemen. Online merchants don’t have to maintain a number of physical stores across provinces, can pay fewer inter-provincial tariffs, and save on logistics, storage, and management. In a sense, they have established an internet-based free trade zone within China’s borders, alleviating the tax burdens on firms and the costs of bringing goods to market.

E-commerce has pushed China’s domestic markets towards unification by forcing them to eliminate practices that contribute to market segmentation. The U.S. has long avoided the problem of internal market segmentation by passing laws and regulations to keep markets from splitting along state boundaries. As a result, compared to their Chinese counterparts, American brick-and-mortar retail outlets are more competitive with their online rivals.

Efforts to expel migrants from cities pose an existential threat to the country’s e-commerce businesses.

Second, China’s e-commerce industry has benefitted from the country’s vast labor pool. As online delivery has become more popular than in-store purchases, the barriers to trade have receded. In 2005, delivery services were limited to the country’s largest cities. Now, China has one of the most far-reaching and efficient delivery networks in the world, covering all major population areas. In 2005, couriers delivered 229 million items to the country’s consumers; in 2016, that number exceeded 31 billion. At the same time, shipping fees have fallen: In 2008, long-distance shipping cost as much as 20 yuan (then $3) per item, but by 2016, this fee was less than 10 yuan.

Migrant labor has therefore increased the e-commerce industry’s competitiveness by helping sellers avoid key problems for China’s traditional retail outlets: high real estate costs, business costs, and living expenses, which city-based firms have historically passed on to the consumer. Urban residents unable to find cheap goods in large cities now turn to online outlets to source goods from other parts of the country. In doing so, they manage to rein in the cost of living in one of the country’s large cities.

Easy access to cheap labor is the main reason why China’s internet sector stands shoulder to shoulder with its American counterpart. Yet this advantage also reveals the industry’s soft underbelly: The responses of policymakers to the country’s migrant worker problems could have series knock-on effects for the online shopping industry. After all, what’s the point of running an online store if there’s nobody to deliver your products to moneyed urbanites?

On the demand side, the strong performance of the country’s consumer market has buttressed the development of Chinese e-commerce. In 2009, the total volume of retail sales in China was about half that of the United States. As the U.S. has spent the past decade or so dealing with the fallout from the subprime mortgage crisis that chilled consumer spending, China’s sales figures have risen significantly. By 2016, China’s retail sales numbers had eclipsed those of the United States.

Emerging groups of consumers are channeling money into newfound forms of social status.

Chinese e-commerce also caters to bargain-hunting urbanites. Over the last few years, China’s aspirational middle classes have become accustomed to high-end products, services, and experiences, such as vacations abroad, imported food, parenting services and products, and cultural activities like concerts and film screenings. But all of this put extra strain on their wallets. Therefore, to balance the books, many consumers look to cut costs on essentials like clothing, electronics, bedsheets, and drapes, all of which just happen to be products that e-commerce services excel at providing at cheap prices.

For middle-class urbanites, the picture is complicated further by the ongoing surge in housing prices. China’s property bubble has driven up the ratio of loans to savings from 29 percent in December 2007 to 62 percent in November 2017. Among young people and nuclear families, especially those living in major cities, this phenomenon has given rise to a new social group: the heavily indebted middle class. While this group should, in theory, stand among those with the highest purchasing power, their upscale tastes and expensive housing needs force many into the online bargain buckets.

Although e-commerce firms have begun trying to offer more upscale products and experiences to cater to people’s consumption upgrade, their business generally remains centered on low-end, low-value products. The most prominent example of this mindset is Singles’ Day, a consumer holiday in November that lures the country’s online shoppers with promises of discounts, deals, and overall value for money.

What will Chinese e-commerce look like in the future? First, consumers will continue to move away from purchasing material products and toward spending on services. Also, they will shift focus from merely meeting their everyday needs toward improving their overall quality of life.

These trends are already taking place, as emerging groups of consumers channel money into newfound forms of social status. For example, urban Chinese are currently going wild for marathons and other forms of physical fitness. Others are choosing customized overseas vacations and luxury accommodation. Many shopping centers now offer parenting services as a way to draw in foot traffic, while others bring together shopping, dining, recreation, culture, and family-friendly activities. Meanwhile, malls that only offer shopping are in decline.

In time, these forms of high-end consumerism with bleed into the e-commerce world too. Yet at present, sellers catering to the above tastes stand at the vanguard of online consumption. In the absence of mature business models, whoever stakes a strong and early claim may emerge victorious.