E-commerce Market in China 2011 - Sample


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The e-commerce market in China will be boosted by the high growth in internet population coupled with rise in online shopping.

The report begins with an introduction to the market which comprises of an illustration of the e-commerce operational model wherein it depicts the work flow of all the stakeholders involved in the market space. Another detailed illustration about the transaction flow in online commerce is also included in the report so as to provide a better picture of the overall transaction system. This is followed by the market overview of e-commerce in China, providing details on the industry size in terms of transaction volume and its growth. It also mentions the popular e-commerce business models, providing an overview, market size and competitive landscape of each type. The report discusses the technical specifications, important features and website design and development stages. It offers value added information regarding the building and hosting of a successful e-commerce website.

The various segments in the e-commerce market namely online retailing, online advertisement, online travel, online digital downloads, online financial services, online stock operations and online paid subscriptions have been analyzed and a brief overview of each segment is included.

Demand and supply perspective section in the report lists the benefits of e-commerce to both the vendors as well as the consumers. It comprises of an in-depth analysis of both the vendor perception and consumer objectives. It also lists the vital requirements for the vendors as well consumers in order to conduct commerce over the internet.

Factors driving the growth of e-commerce market in China have been covered and include increasing internet use, emerging middle class, rise in online shopping, extensive usage of plastic money, enhanced e-payment services, rise in mobile commerce, growing social network base and rise in target industries. The players operating in the market also face challenges which are impeding their development and growth. Major challenges identified are logistics challenges, huge online counterfeit market, psychological barrier and adaptive difficulty, security issues, system lacks talent and information resources, and entry barriers are also hampering the growth of the market.

The government policies and initiatives have been covered. Emerging trends in the e-commerce market have been highlighted and include geographical spread of online shopping, group buying, initiatives by players, internal logistics network, favourable demographics, traditional stores opting for online stores, availability of greater funding and rising popularity of e-books.

The competition section outlays the competitive landscape of the e-commerce industry in China providing information regarding the major domestic and foreign players existing in the market. This section provides a ranking of the players based on the revenue and profits followed by a 3 dimensional ...

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E-commerce Market in China 2011 - Sample

  1. 1. E‐commerce Market –E commerce Market ChinaNovember 2011
  2. 2. Executive Summary  E‐commerce market in China has been demonstrating rapid growth and development over the past few years Market  China’s e‐commerce will continue to exhibit speedy growth with annual sales volume growth of at least x % y‐o‐y   from 20‐‐ to 20‐‐ Drivers: Challenges: ‐ Increasing internet use  ‐ Logistics challenges ‐ Emerging middle class ‐ Huge online counterfeit market ‐ Rise in online shopping ‐ Psychological barrier and adaptive difficulty Drivers &  ‐ Extensive usage of plastic money ‐ Security issues Challenges ‐ Enhanced e‐payment services ‐ System lacks talent and information resources ‐ Rise in mobile commerce ‐ Entry barriers ‐ Growing social network base ‐ Rise in target industries  Geographical spread of online shopping h l d f l h  Favourable demographics bl h  Group buying  Traditional stores opting for online stores Trends  Initiatives by players   Availability of greater funding   Internal logistics networks  Rising popularity of e‐books  Government Policies and Regulations (20 ) Government Policies and Regulations (20‐‐)Government   Government Policies and Regulations (20‐‐) Initiatives  12th Five Year Plan (20‐‐ ‐ 20‐‐)  International players like Company 1 and Company 2 are boosting their investment in China, indicating tougher  and more fierce competition for the domestic players and more fierce competition for the domestic playersCompetition  Some of the major domestic players in the market are Company 3, Company 4, Company 5, Company 6, Company  7,Company 8, Company 9, Company 10  and Company 11 E‐COMMERCE MARKET IN CHINA 2011.PPT 2
  3. 3. •Introduction•Market Overview Market Overview•Market Segmentation•Demand and Supply Perspective D d dS l P i•Drivers & Challenges•Government Initiatives•Trends Trends•Competition•Key Takeaways K T k E‐COMMERCE MARKET IN CHINA 2011.PPT 3
  4. 4. Operation Model of an E‐commerce System f e d g c a b h E‐COMMERCE MARKET IN CHINA 2011.PPT 4
  5. 5. China’s e‐commerce sector is predicted to experience the fastest growth rate in AsiaE‐commerce Market – Overview  Market Size and Growth• China is the world’s x largest e‐commerce market USD bn  More than y mn internet users, including z mn online shoppers  y , g pp 3,000 a7 along with p mn Chinese middle class population boosts  2,500 +30.9% a6 further growth in the sector 2,000 a5 1,500 a4• In 20‐‐, more than q mn people were directly employed  a3 1,000 a2 by the Chinese e commerce companies by the Chinese e‐commerce companies a1 500  No. of people indirectly employed reached more than r mn  0 and is expected to grow to s mn by 20‐‐ 20‐‐ 20‐‐ 20‐‐e 20‐‐e 20‐‐e 20‐‐e 20‐‐eE‐commerce Registered Accounts E‐commerce Paying Accounts mn mn 300 +16% c420,000 c3 +21% b4 250 b3 c215,000 200 c1 b210,000 b1 150 100 5,000 50 0 0 20 20‐‐ 20 e 20‐‐e 20 e 20‐‐e 20 e 20‐‐e 20 20‐‐ 20 e 20‐‐e 20 e 20‐‐e 20 e 20‐‐e E‐COMMERCE MARKET IN CHINA 2011.PPT 5
  6. 6. Type 1 transactions dominate the e‐commerce market in ChinaType 1 E‐commerce  Market Size and Growth• Type 1 refers to an online market for online business  USD bn deals 3,000 a7  In Q1 20‐‐,Type 1 revenue amounted to USD x  mn, y‐oy  2,500 +30.9% a6 growth of y% 2,000 a5• No. of Type 1 companies reached z  in 20‐‐, y‐o‐y growth  1,500 a4 of p% a3 1,000 a2 a1  I 20 thi In 20‐‐, this sector received USD q mn in capital from r  t i d USD i it l f 500 investors, which includes s VCs and two IPOs that raised a  0 combined USD t mn and five mergers 20‐‐ 20‐‐ 20‐‐e 20‐‐e 20‐‐e 20‐‐e 20‐‐eCompetitive Landscape (20‐‐) Revenue Break‐Up (Q1 20‐‐) Company 1 c4% Trade by small‐ c3% Company 2 b6% and medium‐sized  Company 3 enterprises Company 4 Company 4 b5% Trade by large  Trade by large c1% b4% enterprises Company 5 b3% b1% Online shopping  c2% Others b2% accounts Airfares and hotels E‐COMMERCE MARKET IN CHINA 2011.PPT 6
  7. 7. G segment boom in China is giving serious competition to the traditional G outlesSegment 1 Segment 1 Sales• G sales in China amounted to ~USD x tn in 20‐‐, and   USD bn are expected to grow by ~y% in 20‐‐ 200• Segment 1 represents the next major segment for  +25.4% a4 150 a3 retail growth in China  a2• China had z mn online stores as of Dec 20‐‐ 100 a1• With increasing prosperity and easily access to the With increasing prosperity and easily access to the  50 Internet, Segment 1 sales is expected to surge in the  coming years 0 20‐‐ 20‐‐e 20‐‐e 20‐‐eShare of Goods Sold Online (20‐‐) Number of Segment 1 Users Online Retail Users Penetration Type 1 mn % Type 2 200 +49% 1,0 b1% c3 Others b3% 150 c1 100 0,5 50 c2 c4 0 0,0 b2% 20‐‐ 20‐‐ E‐COMMERCE MARKET IN CHINA 2011.PPT 7
  8. 8. Drivers & Challenges – Summary Drivers Challenges Increasing internet use  Logistics challenges Emerging middle class Huge online counterfeit market Psychological barrier and adaptive  Rise in online shopping difficulty Extensive usage of plastic money Security issues System lacks talent and information  Enhanced e‐payment services resources Rise in mobile commerce Entry barriers Growing social network base g Rise in target industries E‐COMMERCE MARKET IN CHINA 2011.PPT 8
  9. 9. Trends – Summary Geographical spread of online shopping Group buying p y g Initiatives by players  Internal logistics networks Trends  ` Favourable demographics Traditional stores opting for online stores Availability of greater funding  Rising popularity of e‐books E‐COMMERCE MARKET IN CHINA 2011.PPT 9
  10. 10. Major Domestic Players in the Market (1/8)Company Snapshot: Company 1Corporate Information Financial PerformanceHeadquarters City 1 Cit 1 Revenue Revenue Profit/Loss USD mn USD mn  Profit/LossFounded 20‐‐ a4 400 5 Product 1, Product 2, Product 3, Product 4,  300 0Products a3 Product 5 200 ‐5 a1 a2Key People Person 1 ‐Executive Chairperson 100 ‐10 0 ‐15 20‐‐ 20‐‐ 20‐‐ 20‐‐Business HighlightsBusiness Highlights• Company 1 has focused on selling product 1online and  later expanded into select product 5 category, through its  website x.com   In addition, it operates the x.com marketplace program, which enables third‐party merchants to sell their products alongside products  sourced by the company db h• As of March 20‐‐, it has sold more than y product 1 along with other media products, the largest selection available  from any single retailer in China both online and offline• It has z  logistics centers strategically located throughout China• In Q2 20‐‐, company started the operation of the P fulfillment center and expanded the new facility in Guangzhou  fulfillment center, resulting in total warehouse space to q square meters E‐COMMERCE MARKET IN CHINA 2011.PPT 10
  11. 11. Other Major Domestic Players in the Market (1/6)Company Snapshot: Company 2Corporate Information Business HighlightsHeadquarters City 2 Cit 2 • Company 2 is a family of Internet‐based businesses Company 2 is a family of Internet based businesses   It includes online marketplaces, retail and payment Founded 19‐‐ platforms, shopping search engines  and data‐centric  cloud computing  services Product 1, Product 2, Product 3, Product 4, Products  It’s subsidiaries include x.com, y Marketplace, z Mall, p ,  , , Product 5, Product 6, Product 7 q  Cloud computing, r  and sKey People Person 2 ‐chairman • x.com operates as a subsidiary of the company 2  x.com operates as a business‐to‐business e‐commerce  company in the PRC and internationally – Company offers platforms for international,  domestic, and retail trade  In Sep 20‐‐, company plans to raise as much as USDe mn  from the listing of its website‐designing unit in the U.S• In Oct 20‐‐, company announced its latest plan to In Oct 20 , company announced its latest plan to   In Feb 20‐‐,company bought f% stake in Sinosoft  Technology Plc, Chinese export‐services software maker,  invest USD h mn to its B2C subsidiary, z.com (z Mall),  with an investment of USD g  mn as an effort to enhance  in an effort to assist small and medium sized  it’s customer service enterprises E‐COMMERCE MARKET IN CHINA 2011.PPT 11
  12. 12. Websites SAMPLE Online Traffic Specifications (1/7) Online Traffic Statistics Global Traffic Rank – p Traffic Rank (China) x1 Daily Pageviews* Daily Pageviews* x2x.com Daily Visitors* x3 Time spent on site (minutes) x4 Global Traffic Rank – q Traffic Rank (China) y1 Daily Pageviews* y2y.Com Daily Visitors* y3 Time spent on site (minutes) y4 Global Traffic Rank – r Traffic Rank (China) ( ) z1 Daily Pageviews* z2z.com  Daily Visitors* z3 Time spent on site (minutes) z4 E‐COMMERCE MARKET IN CHINA 2011.PPT 12
  13. 13. Thank you for the attentionE‐commerce Market ‐ China report is a part of Netscribes’ Information Technology Industry Series. For more detailed information or customized research requirements please contact: Jitendra Punjabi Jitendra Punjabi Gagan Uppal Gagan Uppal Phone: +91 33 4064 6215 Phone: +91 22 4098 7530 E‐Mail: jitendra.punjabi@netscribes.com E‐Mail: gagan.uppal@netscribes.comAbout NetscribesNetscribes is a knowledge‐consulting and solutions firm with clientele across the globe. The company’s expertise spans areas of investment &  g g f g p y p p fbusiness research, business & corporate intelligence, content‐management services, and knowledge‐software services. At its core lies a true value proposition that draws upon a vast knowledge base. Netscribes is a one‐stop shop designed to fulfil clients’ profitability and growth objectives. p p f g f y g g p pDisclaimer: This report is published for general information only. Although high standards have been used the preparation, Research on India, Netscribes (India) Pvt. Ltd. or “Netscribes” is not responsible for any loss or damage arising from use of this document. This document is the sole property of Netscribes (India) Pvt. Ltd. and prior permission is required for guidelines on reproduction. E‐COMMERCE MARKET IN CHINA 2011.PPT 13