Demand for foreign brands drives consumption upgrading

2023-12-25 09:54:06China Daily Editor : Li Yan ECNS App Download

Customers choose imported goods in the first cross-border e-commerce experience store in Rugao, Jiangsu province, on Sept 13. (WU SHUJIAN/FOR CHINA DAILY)

Better logistics efficiency, preferential policies provide more imported goods

Chinese consumers are demanding high-quality, foreign brands in keeping with changing lifestyles, fueled by enhanced logistics efficiencies and preferential policies such as lower tariffs and an expanded list of imported goods, experts said.

The number of users purchasing products from Europe rose 79 percent year-on-year between January and October compared with the same period of 2019, according to a new report by e-commerce company JD's Consumption and Industry Development Research Institute.

Maternal and infant products, beauty and skincare goods, nutritional and healthcare items, alcohol, and food and beverages are the most favored categories by Chinese consumers among all imported European products, the report said.

The top five European countries for imports are France, Germany, the Netherlands, Italy and Spain.

Shoppers aged between 26 and 35 are the major consumers of imported European products, accounting for 45 percent of all age groups, it said, adding that there is growing interest in European products among consumers in counties and rural areas.

During this year's Singles Day shopping carnival, JD Worldwide, its cross-border e-commerce platform, saw a 100 percent year-on-year increase in transaction volume across more than 350 cross-border imported product categories.

The turnover of JD's national pavilions that sell local specialties of foreign countries surged 250 percent year-on-year.

Data from Tmall Global, the cross-border e-commerce site of Alibaba Group, showed that sales of imported wine jumped 193 percent year-on-year in 2022.

It said people living in third- and fourth-tier cities contributed the fastest growth in the purchase of imported, high-end and niche household products.

Tmall Global said it introduced more than 6,400 new overseas brands in 2022, with the turnover of imported wine, urban cycling products and motorcycle helmets doubling from a year earlier.

"Chinese consumers have shown rising purchasing demand for diversified, personalized and niche overseas products, and are attaching more importance to the value of the goods they buy," said Zhang Zhouping, a senior analyst on business-to-business and cross-border activities at the Internet Economy Institute, a domestic consultancy.

Zhang said cross-border e-commerce has played a significant role in enriching product supply, bolstering the development of new business models and promoting the recovery of consumption.

China has been optimizing the list of imported retail goods for cross-border e-commerce.

Last year, 29 product categories with strong demand from consumers, including ski equipment, dishwashers and tomato juice, were added to the list, according to a statement jointly issued by the Ministry of Finance and seven other central government departments.

Market consultancy iiMedia Research said China's further opening-up, gradual improvement in logistics and deliveries, and consumers' rising demand for imported goods will provide a big boost to consumption upgrade.

"The penetration rate of cross-border e-commerce in lower-tier cities and townships has been increasing in the past few years," said Chen Tao, an analyst with internet consultancy Analysys in Beijing.

He said that online shopping via livestreaming videos — a quick way for domestic consumers to find detailed information on overseas products — has become popular among the post-1980s and post-1990s generations of consumers.

China's cross-border e-commerce sector has seen robust growth in recent years.

The import and export scale of the country's cross-border e-commerce reached 1.7 trillion yuan ($237.9 billion) in the first three quarters, up 14.4 percent year-on-year, said the Ministry of Commerce.

An increasing number of Chinese merchants now sell their products to overseas markets via cross-border e-commerce platforms, which provide a new way for micro, small and medium-sized enterprises to expand their global footprint.

Cindy Tai, vice-president of Amazon and head of Amazon Global Selling Asia, said Chinese sellers who sell products abroad through Amazon's overseas marketplaces have maintained steady growth in the past year. She said cross-border e-commerce is increasingly becoming a new growth driver for China's foreign trade.

Tai said the company will ramp up efforts to help Chinese merchants build brands, simplify global operations, optimize global supply chain services, expand their global footprint, as well as scale up localization inputs next year.

Data from Amazon showed that the number of Chinese sellers on Amazon's global sites, each with sales exceeding $1 million, increased by more than 25 percent year-on-year from October 2022 to September this year, and that the number of sellers with sales reaching over $10 million each rose nearly 30 percent year-on-year.

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