Cross-border e-commerce spending expected to reach $100bn in China

A growing middle class in China with a high propensity to shop for foreign brands is helping to drive up spending on goods bought outside of China, according to eMarketer’s cross-border e-commerce spending forecast.

The assumption is in line with Singles Day in China, the biggest e-commerce event hold by Alibaba that happened last Satuaday, as analysts see the festival adding more and more overseas businesses.

The forecast analyse quantitative and qualitative data from research firms, government agencies, media firms and public companies, plus interviews with executives at publishers, ad buyers and agencies.

The analysis reveals that the total cross-border ecommerce sales in China are expected to reach US$100.17 billion by the end of 2017, with the average spend per cross-border digital buyer at US$882.

Average spend per buyer has increased since previous forecast due to the growing awareness of overseas brands in China, as well as better logistics and the perception that foreign goods are of better quality.

Also contributing to the growth is the popularity of Tmall Global, JD Worldwide and Kaola, sites that have made it easier for shoppers to access a wide variety of overseas products on a platform they are familiar with.

More than a fifth (23%) of digital buyers in China will make at least one cross-border purchase via the internet, and growth in such purchases will start to slow over the forecast period as more residents choose local brands for some categories such as fashion. Realizing the demand for better-quality goods, local brands are starting to adapt to this change.

"The factors fueling the trend toward greater cross-border shopping are nothing new, as the average Chinese consumer is now more tech savvy, more exposed to foreign brands through overseas travel and the internet and, crucially, more willing to spend," said Shelleen Shum, senior forecasting analyst.

"With shopping sites such as TMall Global, JD Worldwide and Kaola adding more brands to their offerings and improving cross-border logistics and processing times, there is an opportunity for foreign brands to tap into the demand for high-quality products, especially in categories like baby, maternity, health and beauty."