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China’s E-commerce Goes Mobile in 2014


China’s e-commerce goes mobile in 2014

China’s e-commerce revolution is transitioning from computers to mobile in 2014. The spread of m-commerce, especially for millions of new consumers in inland China, will make mobile the purchasing channel of choice going forward.

Alibaba’s visionary founder Jack Ma commented earlier in 2013, “The mission of Alibaba’s mobile department is to eliminate Taobao – by replacing it with Taobao mobile”. Now all Chinese e-commerce firms realize that it’s time to move their business to mobile devices, before rival companies get a chance to take the lead.

M-commerce and China’s New Frontier

Mobile phones are already the most used vehicle for Chinese internet users to access the internet. According to official statistics from the China Internet Network Center (CNNIC), 78.5 percent of Chinese internet users accessed the web via their phones as of June 2013. Compare that to 69.5 percent accessing the internet on desktop computers, and 46.9 percent via laptops.

Additionally, the rapid development of China’s 3G network – there are now over 300 million 3G subscribers – and publicly available wi-fi spots combined with more affordable mobile devices are making access much easier for many Chinese. Especially when rural consumers likely only have one device and must choose between either mobile, laptop, or desktop computers – mobile will win the price-value equation. This is important because the new growth point of China e-commerce is transitioning quickly to China’s rural and lower-tier regions, given that online shopping in wealthier and more developed coastal China is already well established. Mobile, as a result, is rising as a vital channel to connect e-commerce stores and online merchants to their end consumers in China’s new frontier.

Payment Solutions

China’s large internet companies are fighting to develop innovative mobile payment solutions to take advantage of this emerging trend. Alipay, an online payment company run by Alibaba and which is similar to PayPal, is now making a concerted effort to steer its PC users to mobile, and also to get new users to download its mobile wallet style app.

The Alipay app allows users to do things like making a payment at a mall, using sound wave technology that works with any phone. Additionally, users can transfer money to a contact face-to-face via QR code, organize travel itineraries, collect electronic coupons, buy movie tickets, and much more. These highly practical functions make Alipay’s mobile app the top source of mobile internet transactions, accounting for 78.4 percent of mobile internet payment transactions in 2013 (as of September).

Alibaba’s major rival, Tencent has its own e-payment platform in the form of Tenpay. Tencent is now able to integrate that with WeChat, its highly popular messaging app. And so WeChat now incorporates mobile payments for its hundreds of millions of users in China. A WeChat user can pay for in-app emoticons, mobile game in-app items, movie tickets (yes, as does the Alipay app), and promotional offers provided by partner vendors. WeChat recently partnered up with phone-maker Xiaomi to sell a batch of smartphones via WeChat. All 150,000 units available sold out in under 10 minutes.

Originally published on TECHINASIA.

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