E-commerce is booming in China. For Singles' Day, the country’s biggest e-commerce holiday, Alibaba Group alone has reported record breaking sales of $9.3 billion. And the good news for American retailers and manufacturers is that the rapidly growing Chinese e-commerce market isn’t limited to just local online offerings. Chinese consumers are willing and eager to buy products from overseas, with 32% of Chinese respondents to our recent survey saying they’ve already purchased overseas goods online.
With over 600 million Chinese consumers already online and with an estimated trade value of more than 100 billion Yuan (approximately US$16.3 billion) in 2014 of online foreign products, these shoppers offer a major opportunity that U.S.-based and global retailers and manufacturers cannot afford to ignore.
While still a relatively new phenomenon, 32% of Chinese respondents said they purchased overseas goods online. But not all products have the same international appeal. Apparel, accessories and handbags (43%) are the top categories for overseas purchases, followed by cosmetics and personal care products (41%) and mother-and-baby goods (30%).
Many are turning to the web for ease of use. Seventy five percent of respondents said convenience and time savings were key drivers for buying online. In addition, 59% of Chinese-mainland respondents said they enjoyed the ease of browsing through different collections on the Internet.
Not all of China's online shoppers are looking abroad. In general, Chinese consumers represent a significant part of the worldwide luxury market, with a trend towards becoming more demanding and sophisticated shoppers. And it's many of these well-off, luxury-seeking shoppers who are turning to the web to find the highest-quality items.
Nearly 40% of overseas shoppers are between 26 and 30 years old, and 60% state they have a monthly household income of more than 11,000 Yuan (US$1,800). Compared to their male counterparts, Chinese women are showing more enthusiasm for buying overseas products online: they make up 57% of overseas online purchasers.
China's shoppers are highly aware of luxury shopping online. In our survey, 77% of respondents knew websites selling luxury items, with 45% of respondents stating that they have bought luxury items online and 48% saying they were considering doing so. Luxury brand-owned websites (50%) and social media pages (49%) were their first source for information. Of those who have already bought online or who are ready to try, 90% say they would buying luxury goods online in the next 12 months.
These consumers' top consideration for luxury goods is “quality,” according to 56% of respondents. Another 46% say they associate luxury goods with “fine design.” Forty-two percent of Chinese respondents said buying luxury goods can provide a sense of “taste” and “difference.” They will also buy luxury goods just to reward themselves (42%).
So what luxury goods are being added to shoppers' online baskets? Luxury accessories (71%) and high-end cosmetics and skin care (70%) are the two most popular categories for luxury e-commerce purchases.
Digital is increasingly the first touch point in shoppers' buying decisions. When deciding where to purchase online, the study found that Chinese consumers rely on online research prior to making a purchase. And they're on the hunt for specific qualities, looking for online retailers with reviews that indicate they are “reliable” and that they offer “reasonable price” and “good-quality products.”
Social media is also an increasingly important platform for brands, both global and local, to build trust with the Chinese consumer. According to a recent Nielsen survey, 60% of Chinese shoppers have visited social media platforms and reviewed users’ recommendations on independent online platforms as the main source for their purchase plans. Over 40% of the online Chinese shoppers surveyed said they were willing to share their experiences with new products through WeChat and other instant messaging tools.
Nielsen’s latest annual report on online shopping behavior of Chinese consumers is aimed at providing a comprehensive overview of the e-commerce market and online shoppers. The report is based on an online survey of 4,500 respondents aged 18-plus from 14 major Tier1 and Tier 2 cities in China. All respondents have independently made more than three online purchases in the past six months. The online-based survey was conducted from July 18, 2014 to Aug 3, 2014. Beyond the key online shopper trends, the report also gives detailed analysis of the performance of 46 of China’s key online retailers, including Tmall, Yihaodian, Joyo, Dangdang and Suning, as well as many others. Online shopper preferences for these e-tailers in a total of eight large product categories are also covered in the survey.
The Nielsen Mainland Chinese Luxury Shopper survey polled 1,005 Internet respondents from four segmented geographic regions to understand the luxury shopping general habits and awareness. Conducted between Aug. 14, 2014 and Aug. 22, 2014, the study provides insight on shopping and spending behaviors across the most commonly shopped categories and key destinations.
This article originally appeared on Huffington Post.