Convenience and a cashless society fuel m-commerce in China

China is, more than ever, becoming a “mobile-first” country and consumers there are increasingly making purchases via mobile. Alexis Bonhomme, co-founder of digital and tech company CuriosityChina, shares with Muneerah Bee how China’s complete and competitive mobile eco-system is pushing m-commerce in the country.

What are some of the market forces that are driving m-commerce in China? 

Alexis Bonhomme: M-commerce is a natural evolution of online consumption in China and different forces are pushing the market demand.

Firstly, the China e-commerce eco-system is made up of different marketplaces (such as Tmall and Taobao) and retailers such as VIP.com and JD.com. Additionally, there are individual websites and mobile shops (such as WeChat store).

The new payment technology is also making things more convenient for consumers. We are seeing that with Alipay, WeChat Pay and other providers such as Samsung pay and Apple Pay. Many online players and websites in China accept mobile payment and point-of- sale (POS) companies also equip retail stores to process mobile payments.

As consumers in China are often pragmatic and are likely to be early adopters, China is becoming the first cashless society in the world.

Should retailers differentiate their e-commerce and m-commerce strategies for the China market? Could you share some examples of how they can do so? 

Bonhomme: Absolutely. Besides m-commerce versus e-commerce, they need to define a strategy based on “owned” platforms versus third-party platforms.

Third-party platforms offer traffic, exposure and can handle logistics, IT and overall payment/refund questions. On the other hand, they might not provide consumer data and the user/brand experience can hardly be controlled compared to a platform of your own.

Owned platforms such as standalone websites or m-commerce options (such as WeChat store) allow brands to have a fully branded user experience, collect user data and increase direct sales. We foresee a revival of the standalone website in 2018, as well as an increase in m-commerce handled by brand directly, which offers a strong alternative to third-party platforms.

As consumers today are focusing mainly on mobile when it comes to Internet consumption, brands are trying to close the loop between social customer relationship management and e-commerce. Building an overall mobile-friendly ecosystem is now the key, and the predominance of WeChat helps this strategy.

Are there important things to note for m-commerce retailers who are targeting different cities in China?

Bonhomme: Consumers in first- and second-tier cities are fully equipped with desktop and smartphones. We observe most third-, fourth- and fifth-tier cities, on the other hand, have a significant “mobile-first” approach. The recent Singles’ Day (11/11) shopping festival by Tmall and the June 18 promotional event by JD.com (knowns as “618 Sale”) show the boom of mobile purchases in China.

How is m-commerce in China expected to grow in future?

Bonhomme: It is clearly the trend with platforms such as WeChat used by more than 960 million users or Weibo (which has 360 million users) which
has 92% of its users checking the platform via mobile.

China is now a global example not only for mobile-first consumer behaviour but also for a cashless society. Mobile is not just a communication tool anymore but a Swiss Army knife providing convenience, speed, social sharing and payment capabilities.