We can reasonably expect to see China’s retail “culture” of increasingly online- and mobile-driven shopping gain hegemonic influence around the world.

Bart Mroz, founder and CEO, Sumo Heavy

Bart Mroz, founder and CEO, Sumo Heavy

Asia’s e-commerce market is booming, fueled by hundreds of millions of smartphone-wielding millennials and the growing middle-class throughout the region. China is the leader by far and away. The country of 1.4 billion is setting the trend in Asia for ever-increasing adoption among consumers of e-commerce, which this year is projected to reach $1.2 trillion and make up nearly a quarter of China’s total retail sales.

Meanwhile, companies like Alibaba are enabling the shift. For its part, Alibaba, which was founded in China in 1999, has since grown to be a $361 billion enterprise in stock market value, and it is now the largest retailer in the world. (It surpassed Walmart in 2016.)

Here are three takeaways that we can draw from Asia, and China specifically.

Increasingly connected and going mobile

advertisement

Of China’s 1.4 billion people, 675 million own smartphones and roughly half of the country is connected to the internet.

But in China, just because people are using the internet, that doesn’t mean that they’re using a computer. In fact, in most cases, the opposite is true: 89 percent of web access takes place on mobile devices.

And so, it makes sense that fully 73 percent of consumer spending on Alibaba’s Taobao and Tmall stores comes from shoppers using phones or tablets. Compare that to only 29 percent of e-commerce sales in the U.S. during the same time period.

WeChat paved the way, and Facebook Messenger is taking social commerce to a new level.

Other countries in Asia, though they don’t boast anywhere near the numbers that China does, are following similar trends, and we can reasonably assume that the rest of the world, including the U.S., will follow as personal computer adoption falls and smartphones become more ubiquitous.

China as the social commerce trailblazer

advertisement

The lines between social media and e-commerce are blurring, partly thanks to the advent of social buy buttons and chatbots on popular platforms like Instagram and Facebook. Brands like Tommy Hilfiger and Burberry have launched retail chatbots for Facebook Messenger that can assist customers all the way from browsing products to tendering payments, and many more brands are following suit. The age of mobile and social commerce is here.

However, in reality, this age of mobile/social commerce has been here a while already: the shift began taking place in China years ago. WeChat, the very popular Chinese messaging platform, has had a bot platform since 2013, and Chinese social media users have been relatively quick to adopt shopping and buying on the platform, which now has over 800 million monthly active users. For reference, that’s more than double the entire U.S. population. This is significant.

WeChat, and now Facebook Messenger (whose 1.3 version update allows a brand’s promoted posts to link straight to a Messenger chat), are allowing more and more retailers to take their products straight into users’ social media. WeChat paved the way, and Facebook Messenger is taking social commerce to a new level. Through these platforms, their billions of monthly active users are now exposed to marketing from scores of global brands.

China is helping open global markets

WeChat and social/mobile commerce — namely the momentum that they’re gaining — offer us a telling insight into what’s to come. They’re gradually facilitating a psychological shift among consumers and creating a preference for (and expectation of) shopping that is highly personalized, convenient and fast.

advertisement

In turn, this is paving the way for companies like the retail giant Alibaba (also Chinese) and other retailers to capitalize on the opportunity to push more products in more markets around the world. Indeed, we can reasonably expect to see China’s retail “culture” of increasingly online- and mobile-driven shopping gain hegemonic influence around the world, and elevate China in the Asia-Pacific region in terms of economic development.

The rest of the world will follow suit in the coming years, especially as more people in the developing world gain access to internet and mobile technology, and it will be exciting to watch over the coming decade as mobile e-commerce is leveraged to open markets to more and more people.

Sumo Heavy is a digital commerce consulting firm based in New York and Philadelphia

Favorite