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Analysys: The Transaction Size of China’s B2C Online Retail Market Reached RMB 651.94 Billion in 2016Q2. Market Growth Tended to be Stable.
According to the data in the Quarterly Monitoring Report on China’s Online Retail Market in 2016Q2 released by Analysys, the transaction size of China’s online retail market reached RMB 1,213.20 billion in the second quarter of 2016, with a year-on-year growth of 34%.
  • 29 Nov, 2016
  • E-commerce
  • 342
According to the data in the Quarterly Monitoring Report on China’s Online Retail Market in 2016Q2 released by Analysys, the transaction size of China’s online retail market reached RMB 1,213.20 billion in the second quarter of 2016, with a year-on-year growth of 34%.  
In addition, according to the data in the Quarterly Monitoring Report on China’s B2C Online Retail Market in 2016Q2 released by Analysys, the transaction size of China’s B2C online retail market reached 651.94 billion in the first quarter of 2016, with a year-on-year growth of 39.6%.    
The B2C online retail market presented a seasonal recovery in the second quarter. The turn of spring and summer was the hot season of online retail of apparel & accessories and 3C household appliances. Large e-commerce platforms launched the promotional activities, i.e. “April 18”, “April 23”, “May 20” and “June 18”, which discharged the consumption needs for apparel & accessories, 3C household appliances and book publications. Online retail inspired the weak consumer market and sustained a growth momentum even if the domestic economy embraced the continuous and huge downward pressure.  
With respect to market share, Tmall.com, JD.com and VIP.com as the leaders of B2C online retail market accounted for 87.1% of the market share. Tmall.com accounted for more than half of the shares of B2C online retail market (56.5%) and remained the first. The market share of JD.com and that of VIP.com were further enhanced. JD.com occupied the market share rising from 24.8% in Q2 2015 to 26.8% through the promotional activity on “April 18”; the market share of VIP.com rose from 3.5% in Q2 2015 to 3.8%, ranking the third for four consecutive quarters; that of other major e-commerce platforms, i.e., Suning.com, Gome.com.cn and Dangdang.com remained basically stable.
According to Analysys, the online retail market has entered the stage of maturity. As the growth continues to slow down, the e-commerce giants is planning for a new round of progress in the online retail mode in order to seek the forward and continuous growth and stabilize their market status.
1. The e-commerce industry saw deep integration, advancing to all channels of retailing
After the online retail has formed the mode of growth dominated by “promotions” for years, domestic consumer market has been returning to the rational, quality-oriented consumption. Meanwhile, the online retail market is also exploring a mode of growth that is healthier and more sustainable. After rounds of merger and integration with SMEs in 2015, the two e-commerce giants successively launched their important strategies recently: JD.com established the in-depth strategic cooperation with Walmart and acquired the “Double 2-billion Plan” of yhd.com and Tmall.com supermarket to achieve deep cooperation with Metro and other foreign supermarkets.
The e-commerce giants respectively achieved the powerful integration with the excellent brick-and-mortar retail resources. The online retail market started to set foot on all retail channels. On the one hand, the fusion of online and offline retail channels will become a powerful traffic access for online retail platforms to acquire new users and consolidate the user stickiness in addition to the strategies, i.e., “channel sinks” and “precision marketing”; however, on the other hand, the mature supply chain resources accumulated by brick-and-mortar retail can help the online retail platforms enhance the efficiency of supply chain effectively, and expand categories fast.
In the opinion of Analysys, the strategic win-win cooperation between e-commerce giants and brick-and-mortar retail will accelerate the full-channel transformation and upgrading of domestic retail industry, and lead the retail industry to integrate the sales modes, i.e., brick-and-mortar stores, e-commerce channels and mobile e-commerce channels, facilitating consumers to buy their desirable commodities with the same shopping experience. Meanwhile, more exploration and attempt are prioritized to the perfection of terminal logistics & distribution system. Full-channel retail trend will be further expanded. The online retail platforms will take this chance to gradually build barriers to competition, affecting the future market pattern.
2.   cross-border import retail e-suppliers were at the window period of standardization; the focus of development is shifting from growth or quality improvement
The General Administration of Customs released the new tax policy reform on cross-border e-commerce retail imports in this April, and postponed its implementation afterwards; in June, Shanghai held the conference on drafting the e-commerce law; in July, the United Nations Commission on International Trade Law adopted the Technical Guide for Online Dispute Resolution of Cross-border E-commerce Transactions based on the China’s proposal. A series of policies focusing on cross-border marked that China’s cross-border e-commerce industry is ushering in the “window period” of standardized development.
Analysys insight shows that the cross-border import retail e-suppliers are gradually terminating the extensive development and entering the window period of standardization, with the focus of development shifting towards the quality-driven growth. Correspondingly, they embark on exploring the excellent operating process, improving the supply chain and expand the differentiated products, so as to form a development momentum that is healthier and more positive.
3.  The scenario-based operation emerges; marketing innovation will become the marketing normal of online retail e-commerce
The scenario-based operation is a new mode of e-commerce marketing that emerged fast in recent years. The scenario-based operation of e-commerce integrates the window-shopping experience and online shopping organically, creating an excellent shopping experience for consumers. With live broadcast and IP operation as the main modes, the scenario-based operation is presenting its promotion effect on the e-commerce.
Taobao.com and Tmall.com under Alibaba launched the live broadcasting. By use of precision advertising effect of powerful interactive scenario and online IP, the live broadcasting can prepose the commodity consultancy service, and accelerate the consumers’ decision, so it constitutes the foundation of high conversion rate of e-commerce live broadcasting.
Vip.com has formed the powerful mode of IP operation consisting of “e-commerce + stars + instant online celebrities + live broadcasting” during its scenario-based operation. Star IP, instant online celebrities IP, scenario IP, etc. of Vip.com has erected its status in the e-commerce industry on the strength of personified and scenario-oriented marketing features.
E-commerce operation stands in the exploration from traditional traffic-based operation to scenario-based operation, so the phenomenal business may emerge successively. However, currently in the industry, the resources are currently concentrated on the quality-oriented contents and perception-based community groups, as well as the insight into user experience, which will urge the formation of instant e-commerce operation mode that is more interactive, realistic and funny.
 
Definition of research
Online retail: it refers to the commodity retail trading activities of two parties taking the Internet as a medium, namely the organization and transmission of information on the Internet, which can achieve the transfer of the ownership of tangible goods and intangible goods.
B2C online retail: it refers to the business model that the enterprises sell products to consumers with the help of the network. The conventional statistical data doesn’t include the self-built platform of the enterprise.
C2C: it refers to the business model of commodity trading reached between the users on the online trading platform provided by the enterprises.
The transactions in this statistical report are summarized in accordance with the orders of the user, including the cancellation of orders, procurement of suppliers (including scalper orders) and invalid orders caused by inventory information error.

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