Technology

Online shopping gaining ground in China, says Nielsen

By Hu Yuanyuan (China Daily)
Updated: 2010-07-31 09:12
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BEIJING - Online consumers from China are the most prolific online shoppers in the Asia Pacific region and nearly 95 percent of them are planning a web purchase in the next six months, said John Burbank, chief executive officer of Nielsen Online, the online division of research firm Nielsen.

According to the survey, books and clothing, accessories and shoes top the list of planned online purchases in the next six months for Chinese online consumers. Compared with other countries in the Asia Pacific region, Chinese online consumers are the keenest to purchase clothing online, followed by consumers in South Korea (56 percent) and Philippines (37 percent).

The Nielsen survey polled over 27,000 Internet users in 55 markets globally to understand how consumers shop online and the other factors that come into play when they decide how to spend their money.

"There is not much of difference in the buying patterns of online consumers compared with other countries. The purchases are mainly for price and convenience," said Burbank. "But given the country's comparatively low Internet penetration and the huge base, the e-commerce market has huge potential."

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As of June 2010, the number of Internet users in China climbed to 420 million, 36 million more than the end of 2009, according to a report from the China Internet Network Information Center. But the country's Internet penetration rate, which was 31.8 percent by the end of June, still lags behind many other countries.

Online retail sales increased 117 percent annually between 2007 and 2009, and is expected to reach 450 billion yuan ($66.45 billion) this year, according to the research center of Alibaba Group, which runs the global e-commerce site Alibaba.com.

The Nielsen report shows that total online spending as a percentage of total monthly spending varies by country, with Chinese and South Korean online consumers making the most purchases through the web. Online consumers from New Zealand, Australia, Malaysia and Hong Kong make the least number of purchases on the Web.

Chinese consumers on average spend route 6 to 25 percent of their average monthly spending through the web. Nearly one-third of online consumers said they primarily do their Internet shopping with retailers who have an online presence. Over 26 percent of the respondents opt for sites that also have traditional "brick and mortar" stores and those that allow you to select products from different online stores.

Though e-commerce in China is growing at a rapid pace, online shopping's share of total retail sales in China is still lower than the US and the rest of world.

"Online payment security, ensuring product quality and after sales services are the key barriers for online shopping," said Burbank. "The online market must take steps to improve the credibility of suppliers and transaction security. This will help bolster consumer confidence in online shopping. "