Small and large cities in China warming to ecommerce

China is becoming a consumption-driven society thanks to the rise of ecommerce, according to a new report.

Cited by, a report by McKinsey Global Institute titled ‘China’s E-tail Revolution: Online Shopping as a Catalyst for Growth’ suggested that instead of replacing brick-and-mortar institutes, ecommerce is ‘encouraging incremental consumption’ up and down the country.

According to the report, online consumers in China’s small to medium sized cities were found to spend almost as much money online – as a proportion of their disposable incomes – as their counterparts in larger, more prosperous cities.

In addition, small-city consumers going online allows them access to products and brands not previously available, giving them more of an incentive to make an online payment to these stores.

Low prices are another reason why Chinese consumers are flocking to the platform. McKinsey suggests online prices are on average between six per cent and 16 per cent lower than in-store, with the biggest price difference seen in the categories of apparel, recreation and education and household products.

These three sectors also happen to be the three largest segments of ecommerce, accounting for 35 per cent, 20 per cent and 15 per cent of overall online spend, cites

Other sectors, such as healthcare, food and home improvement accounted for 11 per cent, four per cent and two per cent respectively.


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