E-Commerce Companies in China Head for the Countryside

Published By : 22 Apr 2015 | Published By : QYRESEARCH

The e-commerce giants in China Alibaba and JD.com are making headway to rural areas for lucrative opportunities. The urban consumers for the e-commerce retailers become savvier for products. This intensifies competition and more treading for the e-commerce retailers. 

The initial period of boom for the e-commerce retailers appears to come to an end, as such these companies need to find new avenues and consolidate their position. As such, e-commerce retailers JD.com and Alibaba have started moving to tap the rural markets.

As per JD.com CEO, this is a priority strategy in the second half of the year. Also, Alibaba CEO commented it has plans to expend lot of energy in the rural areas. The company has plans to bring the entire e-commerce to the rural areas in China. This will give rural people to have a taste of city lifestyle and products.

The reason for the move is quite clear, pertaining to estimated sales from rural e-commerce to have a value of US$29 billion for 2014 and the number to reach US$75 billion by 2016. 

As per the consultancy Bain and Co., that is quite a substantial portion of internet sales in China that reached US$390 billion in 2013 and is expected to be at US$530 billion by 2015.
Further, the annual spending report for Alibaba also says consumption growth pattern is drifting from prosperous coastal regions to the inland provinces. 

Also, the first national economic and e-commerce forum which was held in May 2014 reported that sales in rural areas and counties surpassed sales in urban areas by 13.6% points in the year 2013.
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