Key trends in the e-commerce industry in China are:
- Cross-border e-commerce – you don’t need to establish a legal entity in China
- Livestreaming for e-commerce – millions of shoppers buy during live streams
- Mobile device use is on the rise – most shoppers use their phones for online purchases
- New categories such as alcohol, fast-moving consumer goods, and fashion are entering the e-commerce market
Foreign companies will face tough competition in this industry. Chinese companies are very responsive to their competitors, often copying their products to create their own versions and sell them at a lower price.
In addition, Chinese consumers are more likely to buy from companies they are familiar with, which requires companies to stay active on e-commerce sites and social media and expand awareness of their products as quickly as possible.
Marketing and advertising in the e-commerce industry
Advertising, both traditional and online, is tightly regulated in China. Chinese national and provincial governments exert strict control over advertising content, and Chinese advertising laws stipulate that foreign companies must work with licensed partners to advertise in China.
As such, foreign investors may face considerable challenges when entering the industry.