Managing cross-border payments in a booming Chinese eCommerce market

LinkedIn Twitter Facebook

 

Author: Julian Wallis, UK&I Country Manager, Ingenico ePayments

eCommerce sales in China are rocketing. Currently, e-shoppers there average an annual spend of $1,855 each. Total sales revenue is expected to be worth $1trn by 2019, compared to $534bn in the US. To put this in perspective, sales in the US were $15bn higher than in China just three years ago.

China is a challenging market for Western retailers to expand into, but a rise in living standards means consumers there are increasingly willing to look beyond their borders to find high-quality products, such as nutritional supplements and cosmetics, at the right price. According to a recent report in PYMNTS, a quarter of the Chinese population will be shopping either directly on overseas websites or through third parties by 2020. The most popular shopping destinations for online cross-border sales are the US, Japan, South Korea, Germany, Australia and the UK.

 

Plenty of retailers have struggled with their expansion into China, but with the right strategy, merchants will enjoy great success. Despite its phenomenal growth, the Chinese market’s most exciting days are still ahead of it: Alibaba, the country’s largest online retailer and marketplace, is aiming to serve two billion consumers and support 10 million businesses within the next ten years.

 

Singles day (11th November, or 11.11) is China’s biggest shopping day of the year and is expected to eclipse last year’s £9.3bn worth of sales by a considerable margin. Alibaba recently extended its 24-hour sale to an incredible 24 days and most of these payments will be processed though Alipay.

Cross-Border eCommerce in China Singles Day 11.11

Mobile payment transactions, for example, are expected to lead the eCommerce boom in China. According to a 2015 Forrester report, 25% of respondents to a survey reported that they shop via mobile phone on a weekly basis. Merchants need to offer this or risk losing out to rivals that do. $383bn was spent via mobile devices in China last year alone.

 

The importance of Alipay, the most popular e-wallet service in China, cannot be overstated. The brand boasts over 800 million users and processes more than 8.5 million transactions every day.

Understanding the market is the key to success

However, payments go beyond Alipay in China. Cash on delivery is extremely popular, while it’s also essential to offer Union Pay as well as other popular local payments providers. Why? A variety of payment options shows a high level of customer care and will help reduce cart abandonment.

 

There are six critical pillars of online retailing that must be addressed in any successful international strategy: localisation, logistics, payments, mobile and multichannel, social media presence, and fraud prevention.

 

When considering an expansion into China, merchants must be prepared to navigate the cultural, regulatory and fiscal minefields that may present complications. Payments will be central to meeting this challenge. Merchants should ensure they can offer the key platforms, but take care to adapt to local variations and preferences. China’s market, both within and outside the country, will only continue to flourish – adapt to its users and you will too.

 

 

For more information, please consult our China cross-border eCommerce country guide.

LinkedIn Twitter Facebook

Royal Mail Sponsor

Register today for unlimited article views, and unique insights

Register Now

Black Friday growing strongly in Brazil

Black Friday growing strongly in Brazil

The phenomenal performance of Black Friday rippled around the world and Brazil was no different with eCommerce Brasil reporting billions in sales. So what are the figures coming out of Brasil on this bargain-hunting shopping day?
eCommerce in Brazil: Going local is key

eCommerce in Brazil: Going local is key

As with anywhere, Brazil has its fair share of problems – but with a population of 200 million, a tech-savvy and consumption-driven middle class and arguably the most internet-connected population in the world, is Brazil seen as a necessary evil for international merchants looking to expand internationally?
Why international e-tailers should re-visit the top of the funnel

Why international e-tailers should re-visit the top of the funnel

The role of brand awareness is increasingly critical to international expansion and with various platforms offering better reach and targeting than ever before, why is it important for international retailers to revisit the top of the funnel to help create a more compelling picture?
Quality of delivery offer important to Dutch shoppers

Quality of delivery offer important to Dutch shoppers

Cross-border eCommerce in Belgium and the Netherlands is making big strides and with a population of 28 million people and combined GDP of €1.08trn and English spoken widely, it’s no wonder it offers an attractive market to international merchants looking to expand into new territories. But does the quality of delivery offered that important to Dutch shoppers?
How to maximise your chances of success in India

How to maximise your chances of success in India

eCommerce is growing at an unprecedented rate in India thanks to a number of factors and with the percentage of online retail sales growing rapidly, what do retailers need to consider in order to maximise their chances of success in India?
What do Russian consumers want when it comes to cross-border shopping?

What do Russian consumers want when it comes to cross-border shopping?

Russia is the 9th biggest country in the world with roughly 30 million online Russian shoppers in 2015 which only continue to grows in 2016. However, with cross-border shopping being the fastest-growing segment of the Russian eCommerce market, what do Russian consumers want when it comes to cross-border shopping?
The importance of understanding what it is to be Russian

The importance of understanding what it is to be Russian

Russia, in terms of internet penetration, did lag behind most other European countries but is rapidly playing catch up. Not surprisingly, eCommerce has increased alongside internet penetration with an estimated 148 million orders generated in 2015. But with so many unknowns surrounding entering the Russian market, what are the golden rules?
What should retailers know about Russian attitudes to parcel deliveries?

What should retailers know about Russian attitudes to parcel deliveries?

Russia offers a potentially attractive market for international merchants, however the market needs careful consideration in order to get it right. Things to take into account include the distinctly different Russian way of thinking, along with the legal rules and political context of the country. So what are the key things retailers need to know?
Retail Pricing in a post-Brexit world

Retail Pricing in a post-Brexit world

Since Brexit, a number of events have taken place which has meant the price of items has significantly dropped in the UK. But what are the affects of the UK leaving the European Union on retail pricing?
Australia extends tax to foreign eCommerce

Australia extends tax to foreign eCommerce

For a number of valid reasons, Australia is still a destination firmly in the minds of any business looking to expand into the APAC region. With an attractive foreign eCommerce tax law favoring companies coming into Australia, what are the big changes coming down the line in 2017?

Contact Us

eCommerce Worldwide
2 Ching Court
49-53 Monmouth St
London
WC2H 9EY

Tel: 0203 696 0980
2016© eCommerce Worldwide

Keep In Touch

powered by Affino

About eCommerce Worldwide

eCommerce Worldwide provides online retailers with all the information, and resources, they need to develop cross-border strategies for entering new markets around the world
Read More