Retail revolution – the digital transformation of shopping in China

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Few countries have experienced such huge changes through technology as China has. In recent years the country has skyrocketed into becoming the biggest smartphone marketplace in the world, with smartphone penetration forecast to exceed 90 percent by 2018. As of around a year ago, research has China’s mobile internet users at 649 million and growing steadily. This is a true mobile revolution and indicative of China’s changing times and culture.

To give further context to the size of the online marketplace in China today, China’s internet users now double the entire population of the United States. Tens of millions of new users are getting connected every year in China, prompting internet luminaries such as Facebook’s Mark Zuckerberg and Apple’s Tim Cook to make visits to China to see the evolution for themselves. And one of the areas where China is experiencing the biggest digital impact is a typically very traditional industry – retail.

 

Digital technology powering transformation

Technology has been a massive enabled in transforming the retail landscape in China. The country’s huge geographical disparity previously meant that remote villages, towns and cities simply could not have access to the products and services they can today.

Mobile connectivity has changed shopping in China beyond all recognition, and e-commerce has boomed. In recent times 20 per cent of Chinese retail has shifted into online channels, a huge transformation, and China’s e-commerce industry is also growing rapidly - China is forecast to become world’s biggest e-commerce market by 2020, outstripping the US, and the value of China’s B2C e-commerce sales will hit $1.668 trillion by 2020.

This is reflected in the number of Chinese people today using their mobile devices to make purchases; more than 25 per cent of China’s 1.2 billion mobile users have already bought goods or services using their phones. And it is a trend that only looks like increasing.

Furthermore, the digital transformation of retail in China embraces more than only mobile devices and smartphones; it is about improving the customer experience overall, and while e-commerce is at the center of it, technology is revolutionizing the entire event. This means enhancing the in-store customer experience through Wi-Fi, digital signage, mobile payments and location-based promotions. The retail revolution leverages not just mobility but also brings cloud computing, data analytics, social media and more into the equation.

 

Changing times, changing habits

So it is clear that not only are China’s consumers changing the way that they purchase goods and services, but also that they are transforming the entire retail experience altogether. The rise of mobile and social media have enabled Chinese shoppers to interact in ways that they previously could not; 50 per cent of consumers are now using online price comparison tools while 42 per cent are using coupons to claim discounts compared to 25 per cent in the rest of the world.

Proximity marketing and location-based offers are in effect, with 26 per cent of shoppers receiving offers direct to their mobile devices when in the vicinity of a store, again compared to 12 per cent in the rest of the world. 24 per cent of Chinese shoppers now check in at stores using mobile apps to take advantage of marketing offers and to interact with the store itself. China really is now showing big demand for the digital shopping experience.

Consumers across China are taking advantage of the benefits that e-commerce offers but also combining it with traditional shopping; the approach that used to be known as ‘bricks and clicks’. Digital solutions and e-commerce give them greater choice and convenience plus the benefits of virtual interaction with the retailer, but shoppers are doing online research, taking recommendations from social media, purchasing goods online but then also collecting them in the actual stores. So retailers need to take a cross-channel approach, one that combines both the cutting edge mobile technology and also an innovative in-store offering that keeps the customer coming back.

 

Orange helping drive China’s retail revolution

With that in mind, China’s retailers need the right partner who can help them optimize and support their e-commerce operations while retaining a robust in-store offering. China has seen a sea change in the way consumers purchase products and a shift to digital in how they want to engage with retailers.

Orange China has worked with major retailers such as Darty and Jingdong Mall to help them transform their operations using digital technologies, helping them enjoy increased sales, improve overall customer experience and enhance their retail operations from front to back. The opportunities for retailers and e-commerce in China are huge – digital retail is here to stay.

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To learn more about how Orange digital solutions are helping businesses in China transform their retail and e-commerce operations to deliver world class customer experience, please click here: http://www.orange-business.com/en/china

Jack Zhang
Jack Zhang is Country Manager, China for Orange Business Services, and is responsible for leading the business and managing operations country-wide. He supports Orange’s digital transformation vision for enterprises by developing opportunities in key growth areas including hybrid networks, IT services and cloud.  Jack has over 15 years of experience in the dynamic IT and telecommunications market in China and has a deep understanding of the market and the communications industry.