Mobile Commerce in China: What Can We Learn?
M-commerce sales in the UK were reportedly worth over 41 billion euros last year, accounting for 43% of all e-commerce sales. There’s no doubt that mobile is now big business. Yet despite the growing importance of mobile sales, many retail executives are struggling to adopt a mobile-first mentality when it comes to UX and digital design, resulting in poor mobile conversion rates vs desktop and a less than seamless customer experience. At times it can feel like we’re playing catch up on mobile, trying to fit a square peg into a round hole. Perhaps it’s time to look for inspiration from across the world?
In China the smartphone is the ‘go to’ device for everything – from social and search to shopping and everything in between. In this latest blog we’re asking what can the UK market learn from the success of m-commerce in China?
It’s a mentality
China never really was a ‘desktop first’ nation. As soon as mobile phones became widely available Chinese people started using them to access the internet. Today there are more than 772 million keen internet users in China- and nearly all of them (97% ) use their mobile devices to go online.
Not only do users text, talk and search on mobile, they use their devices to purchase goods and services. Sales on mobile in China are expected to nearly triple from $909.93 billion to $2.595 trillion between 2017 and 2021. The UK’s adoption while also rapid, is overshadowed by China’s immense growth. UK retail m-commerce sales will rise by 14.2% between 2017 and 2021, when purchases made online via mobile devices will make up well over one-tenth (13.4%) of total retail sales.
What’s also remarkable is that according to the China Internet Information Centre only half of China’s population currently access the web – so the potential for growth is immense.
Interaction wherever, whenever
Why do Chinese consumers prefer to buy via phone? Firstly there’s WeChat – a place that offers far more than chat. People in China, and in Asia overall, are keen social messenger users – especially on WeChat. The Tencent owned Chinese ‘super app’ recently reached a billion active users – practically everyone in China uses it as their primary social channel as well as for shopping and entertainment. WeChat also allows users to transfer money and join social networks.
As a result of it’s nation-wide adoption, WeChat offers frictionless communication between consumers and brands. Users can scan information about products and make payments. Once a business has registered for a WeChat account, consumers can scan their quick response (QR code) and ‘follow’ them – without the need to fill in a lengthy sign up form.
Businesses can then send marketing messages to their followers by text, audio or video. Retailers can also accept payments from customers via WeChat Pay without them having to interact via a dedicated point of sale terminal.
According to WSJ WeChat Pay controls 40% of the payment market in China – and more and more overseas retailers are signing up to offer this as a payment option to their Chinese customers – Apple included.
In a nutshell, they are using mobile apps to communicate with their customers in the channels that fit their lifestyle. Speaking a language their customers truly understand.
The Ultimate Convenience
Alibaba dominates ecommerce and electronic payment in China, its site accounting for more than that of eBay and Amazon combined.
Shoppers primarily use mobile to pay on Alibaba – on Singles’ Day last year 90% of the platform’s GMV was generated via mobile. Alipay is Alibaba’s payment system which currently holds 50% of the Chinese payment market. Last year Alibaba processed a record number of mobile payments on Alipay – a mind-boggling 256,000 payment transactions per second.
Alibaba’s ‘new retail’ strategy is to meld online and offline experience so that customers can interact with brands in both the virtual and physical world. The idea is – when consumers are in-store everything can happen via smartphone. They can try on items – then purchase them via their phones on Tmall – then avoid the queues by having their items delivered to their home.
Alibaba is a true innovator and where they lead others will follow. By using mobile to streamline the customer purchasing journey they are providing their customers with the ultimate convenience. A recipe for customer satisfaction and loyalty.
What are the key takeaways when it comes to China’s mobile strategy?
Mobile payments are the norm in China: Seven in ten Chinese consumers use mobile to pay for items. 84% of Chinese people are happy to leave the house without cash, and 14% now live an entirely cash-free existence, according to a recent report by Tencent. To get more people buying from you on mobile, you must offer consumers an easy, frictionless way to pay. Preferably without having to enter detailed information.
Partner with consumers: Engage with your customers rather than just selling to them. Chinese brands don’t just offer products and services – they partner with consumers in their daily lives. Chinese companies build their advertising, marketing, social communication, shopping and payment programs around mobile. It’s estimated that Brits check their phones more than 27 times a day, that’s 400 billion times a year combined! Be there in the moments that matter. Mobile offers you a place to build your brand and drive engagement. If, like Alibaba, you can offer customers a rich experience on mobile you could win a greater share of the mobile market.
Get creative: Emulate Chinese brands by integrating experiences across all touchpoints and channels. Consider using virtual reality by incorporating ‘virtual reality’ fitting rooms or using augmented reality mobile apps – to drive customers in-store.
Most consumers never leave home without a mobile device – so they can compare prices, share retail experiences and to a lesser degree – make payments. If you want to excel at m-commerce, follow China’s example. Give consumers a rich interactive experience – and offer them frictionless payment options.
If you’d like more advice on how to take your mobile strategy to the next level contact the team at firstname.lastname@example.org.