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Who Are the Major e-Commerce Players in China?

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The trillion-dollar e-commerce market

The Drum recently reported that China’s (FXI) online retail market is expected to become the first trillion-dollar e-commerce market by 2022. The feat will leave US and Japanese e-commerce trailing behind at $713 billion and $159 billion, respectively.

Only 38% of the population out of a total of 1.4 billion has opted for online shopping so far, which leaves immense scope for market growth.

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Major e-commerce players

Mobile devices serve as the most sought-after option for online shoppers. Alibaba Group Holding’s (BABA) Alipay and Tencent’s (TCEHY) WeChat Pay are the two top mobile payment options in China. Alibaba and JD.com (JD) rule the country’s e-commerce retail sales. They own almost three-quarters of the market with market shares of 58% and 16.3%, respectively.

According to eMarketer, Alibaba’s Taobao and Tmall drove China’s e-commerce sales in 2017, beating estimates by $44.4 billion. However, Alibaba’s share of e-commerce sales in China is expected to fall from 77.6% to 53.5% between 2015 and 2019.

The emergence of a new player

Higher online penetration is coming from China’s Tier 3, Tier 4, and lower cities. This segment falls into the relatively low income group and prefers quality products at more affordable prices, which thoroughly explains the rising popularity and 5.2% market share of Pinduoduo (PDD), which caters to this need.

Target international markets

E-commerce players such as Alibaba and JD.com have extended their international shipping opportunities to the Chinese diaspora of Australia, the United States, Southeast Asia, and Greater China (MCHI).

According to the Economic Times, Chinese e-commerce companies are also targeting India, which has a population of 1.5 billion and shows promising economic growth potential.

These e-commerce companies are also trying to enter oil-rich Middle Eastern countries to bridge the textile market gap that the nations lack. Popular cross-border e-commerce Chinese apps concentrated on markets in the Middle East and India in the first half of 2018.

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