Now Consumer is Reshaping the Online Retailing Landscape
Now Consumer is Reshaping the Online Retailing Landscape by Deloitte China and CCFA suggests retailers should enhance omni-channel transformation and consumer insights and outreach to lead in the "Now Consumer" era. The report also analyzes the 100 Enterprises by Online Sales, revealing China's digital retail trends.
- The Chinese consumer market is in a V-shaped recovery after the Covid-19 outbreak. With China's pandemic prevention and control turning for the better, China's consumer products and retail industries are accelerating the pace of resuming work and production. The decline in total retail sales of consumer products continues to narrow, as online consumption drives overall consumption and physical retail and food & beverage consumption gradually recover. Under the threat of a "second wave", long term challenges still exist for traditional offline-oriented consumer products & retailers.
- Effective policies, diverse consumption demand as well as retail technology development will continue to drive the development of China's consumer market. After the outbreak the Chinese government proactively released a variety of supply side and consumption side policies to boost consumption, quality upgrading, and capacity expansion. In addition, with the continuous release of diverse consumer demand in the post-pandemic era, as well as infrastructure support provided by China's new infrastructure for digital transformation in retailing, China's consumer market will see recovery growth.
- Chinese consumers are increasingly turning to healthy, convenient, and cost-effective products. Since the pandemic outbreak, consumers have paid significantly higher attention to health and safety, adding to their willingness to buy healthy and safe products. In terms of purchasing channels, single-channel shoppers have turned to taking convenient and efficient purchasing channels as their preferred choice. Consumers' purchasing behavior is changing as some consumers are beginning to pay attention to more cost-effective product categories.
- The total sales of China's top 100 enterprises (by online sales) continue to grow, with sales in 2019 exceeding RMB1.24 trillion. The sales threshold of the top 100 enterprises has reached RMB100 million. To be specific, those with sales of billions of RMB accounted for the largest proportion, with 44 enterprises in total, followed by 41 enterprises with sales of hundreds of millions, 13 enterprises with sales of tens of billions, and 2 enterprises with sales of hundreds of billions. Of all the enterprises on the list, 15 of them are e-commerce enterprises, and their sales take up 68.5% of the total sales of the top 100 enterprises. The rest 85 non-e-commerce enterprises account for only 31.5% of the total sales value.
- The top 100 enterprises have a wide geographical distribution, and a high concentration in eastern China. Specifically, northern China has the largest number of e-commerce enterprises and the largest share of online sales (52.1%). Eastern China boasts a larger number of enterprises on the list than other areas and a greater number of retail and consumer products enterprises. Enterprises in southern China have the most diverse retail formats, including supermarket, e-commerce, department store, convenience store, specialty store, and so on. Central China has 8 enterprises on the list, most of which have sales of hundreds of millions of RMB. Both the number of enterprises on the list and their online sales in western China are lower than that in other areas, with most of the enterprises' online sales value being hundreds of millions of RMB. The online sales of multinational enterprises in China are mainly around billions of RMB, and the multinational consumer products & retail enterprises on the list include those from the U.S., Japan, Germany, France, Switzerland and Thailand.