Dispatches from the Epicenter of Global E-Retailing
Western brands and retailers stand to benefit from Chinese consumers’ preference for foreign goods.
The data from the 2016 China 500 show that 398 e-retailers ranked are based in China while 102 hail from overseas. Whether they set up their online presences in China via the country’s wildly popular online marketplaces like Alibaba-owned Tmall Global (whose online sales grew a whopping 179% in Q4 of 2015), or they set up Chinese-language versions of their main retail websites (a strategy that’s paying off for no. 402-ranked iHerb.com, a U.S.-based web-only purveyor of nutritional supplements), or they’re choosing to leverage the outreach from affiliate sites to promote their brands, Western retailers and consumer brand manufacturers stand to benefit from the middle-class Chinese appetite for overseas goods, which connote quality and trustworthiness. The 52 U.S.-based e-retailers ranked in the China 500 grew their collective online sales 24.3% to $17.77 billion in 2015. By comparison, U.S. online retail sales grew roughly 15% per year from 2011 to 2015, according to the U.S. Commerce Department. Among the factors driving growth for Western e-retailers is the Chinese government’s promotion of cross-border e-commerce zones, now in 10 cities, where China’s customs service provides fast clearance of small orders from Chinese consumers, who are not required to pay sales tax on their purchases.