The world of e-commerce is growing exponentially in China. More and more people are now using the internet not only for seeking information about different products but also to buy them. The Internet is now becoming a reliable source of buying high-quality products and services. E-commerce is now boosting lots of businesses in China.
E-Commerce in China
One of them is the wine market. It is strange to see that luxurious food items are being sold online and people are actually buying them. In 2016, more than 21 million people in China bought wine from various online stores. Some online stores are doing better than other and here you will find out every out about it.
Foreign Brands Are More Popular
Most of them bought foreign brands because Chinese people don’t trust local brands too much. There is a strong perception that foreign products are of better quality as compared to local products and it is true to some extent. The perception has not developed over night. Local brands lost their trust gradually over the last few years and foreign brands seized the opportunity and made a strong entry. It is very difficult to access every market of China, therefore, foreign companies started to sell their wine in big cities like Beijing and Shanghai. They also developed their official website especially for Chinese people to ensure that Chinese people can get reliable information about their products. These official websites is the primary source of information for consumers in the wine market in China. The next most popular and reliable source of information are the online stores. These online stores also allow people to buy different products of different brands and companies from one website. Online stores also have the mobile version of their websites which allow users to do shopping virtually from any place.
JD.com Is Winning market shares
Thousands of small and big e-commerce sites are selling branded wine in Chins but only handful of them are successful all over the countries. JD.com is one of those successful companies. This online store has 35% share of total online sales of branded wine. It may be due to the fact that JD has high-quality products of all foreign brands. This online store facilitates both consumers and manufacturers. These e-commerce websites are playing a crucial role in increasing sales in this market.
Now Chinese people can enjoy products of foreign brands without worrying about the quality. It has been noticed that trust of people on the e-commerce website is increasing rapidly especially on e-commerce giants like Alibaba and JD. One big reason behind this change in consumers’ attitude is the increasing usage of smart mobiles. More than 90% teenagers in China have smart mobiles and they spend several hours on mobile applications. Similarly, the number of mature smart mobile users is also increasing rapidly. Online stores in China is cashing on this situation.
Price Is the Major Factor but Quality is also in Demand
The decision-making process of consumers in China’s wine market depends on two factors. These two factors are price and quality. The more influence factor among these two is the price. According to the reports of Wine Intelligence Online Retail & Communication, 65% of online consumers make the decision on the basis of price. They compare the prices of different products on different websites before buying it. They also prefer to get products from those websites which offer special discounts and promotions.
Quality = Price
There is one segment of this market which gives huge importance to the quality of the product. The number of consumers in this market segment is increasing continuously. Last year only 18% consumers in this market were conscious about the quality and made a decision solely on the basis of quality but now this percentage has increased to 26%. It means e-commerce websites should give importance to quality and get the attention of high-quality brand in order to display their products on their website.
Senior manager of Wine Intelligence organization, Chuan Zhou, said that companies need to sell their products in small cities too. The focus of big corporations is on big cities only but small cities can also give them serious revenue. Some organization is expanding their market by offering delivery services in small cities in the North of China. They are getting good results because people in those small cities are also using the internet for shopping branded products. The competition in low-tier cities is low and buying the power of people in these regions ins also increasing with the improving economy of the country. Moreover, there is very few brick and mortar stores in these regions which offer high-quality genuine foreign products due to which online stores can offer real value to these people and increase their profits to great extent.