China’s $2 Trillion E-Commerce Market Keeps Growing
China likes to go big, and when it comes to e-commerce, the Asian giant makes no exceptions. Online shopping rose to be worth $2 trillion in 2014, and it’s still growing at about 25% going into 2015.
To give you a sense of that size, China’s e-commerce market is about 40% of the total retail market in the United States, even though GDP per capita in China is a fraction of what it is in America. On top of that, U.S. online sales are a sliver of what they are in China. In America, online sales are expected to be only $319 billion in 2015, and they’re only growing at about 10%.
To be fair, China’s figure is a bit different, since it includes B2B transactions. However, China’s National Bureau of Statistics believes online retail sales are 2.8 trillion yuan, or $450 billion, in 2014, and they’re still growing at a massive rate.
No matter how you slice it, China’s e-commerce market is bigger than America’s.
The breakneck adoption of e-commerce in China, compared to the relatively sluggish and disappointing adoption of online shopping in the United States, says a lot about the cultures of both countries. Trust in online retailers is clearly much higher in China, and security concerns are much smaller. Americans’ preference for in-person purchases is not met by a similar hesitation in China.
The dominance of Alibaba also helps e-commerce grow, since it’s a single platform that many smaller retailers can use to trade. That provides reliability and oversight as well as an incentive for more people to sell online.
Going forward, the growth rate for Chinese e-commerce is expected to slow, but it’s still huge both relative to the size of the market and in comparison to the relative sluggishness of e-commerce growth in the U.S.