Amazon’s debut on Pinduoduo shows faith in China’s e-commerce market
CHINA is quite different from markets such as the US and the UK.
The country’s internet economy has been growing rapidly and generated more than US$4.64 trillion in revenues last year. During the Singles’ Day sale this year, e-commerce giant Alibaba alone raked in US$38.4 billion in revenues.
Despite fears about an economic downturn, the people of China are optimistic and in the mood to shop online.
The prospects and potential that China offer are too great to be ignored, which is what lured Amazon back to the country after deciding to shutter its local marketplace in China in July this year.
Amazon just announced that it will partner with Pinduoduo — a leading e-commerce platform in China — to sell close to 1,000 products from overseas markets in China.
The US-based e-commerce giant initially made a debut in China about 15 years ago with the acquisition of local player Joyo.com in 2004, which it re-branded as Amazon China in 2011.
In July this year, the company shut down access to its platform for domestic, third-party merchants in the country — but continues to sell products from the US, UK, Germany, and Japan to Chinese consumers.
According to market analysts, Amazon decided to withdraw from the market because of the intense competition. However, the new partnership with Pinduoduo suggests that the company has reconsidered its decision and is exploring alternatives to pave its path back into China’s e-commerce market.
“The Amazon Global Store pop-up store on Pinduoduo provides customers with a curated selection of about 1,000 overseas products with competitive prices, authenticity guarantee, and convenient shipping,” said the company’s official statement.
Based on the statement, it seems as though the US-giant expects to be able to continue to invest and grow its business in China — with a particular focus on cross-border sales.
During the Singles’ Day sale, customers purchased US and Japanese products, among others, indicating a strong appetite in the local market for imported goods; and re-affirming that Amazon is making a good bet in the country.
What Amazon is doing, however, is something any international merchant or brand can replicate.
Following in their footsteps early on will help establish a presence in the market and allow the merchant or brand to gain an understanding of customer expectations — helping craft a robust strategy to gain from China’s e-commerce success story.
In the coming months, access to China is bound to increase. With customer outlook remaining positive, businesses outside China will do well to make some investments in China’s e-commerce market.
- Why RPA should be the first step for automated e-commerce
- How Chinese luxury brands rode out the storm with digital experiences
- Why business can learn from Disney when it comes to staying relevant
- Ethical facial recognition? WEF provides pointers for developers
- Are mobile payments the future? COVID-19 could see it go either way