Page 282 - 2020 White Paper on the Business Environment in China
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0 White Paper on the Business Environment in China
of local and imported products. That’s because resources. New Retail is the result of efforts to
the American giant takes the Chinese market find solutions to a key set of problems for each
seriously. Above all, Costco’s dramatic grand side. For the physical store chains, they have been
opening in Shanghai illustrates the importance unable to keep up with the growth of online retail.
of strategic preparation for the Chinese market. For the online operators, they have struggled to
Despite appearances, Costco isn’t exactly new keep delivery infrastructure capacity up with the
to China. It’s had a marketing relationship with rapid growth in online shopping demand. New
Chinese Internet giant Alibaba for five years. Retail means more connection and integration
During that time, it has offered online delivery, - not just for retailers, but also for consumers,
allowing it to build up its supply chain. On the other manufacturers and other industry players (China
end, it also increases brand awareness and create Daily, Online Meets).
expectations for Chinese consumers. Obviously,
Costco cleverly built up excitement around the Chinese e-commerce giants, gadget-makers
Shanghai grand opening—a strategy that has and financial solution providers are now shaping
clearly worked extremely well (Mourdoukoutas). the global retail sector. Alibaba has rolled out
more than 10,000 self-checkout machines at its
New Retail own offline stores and stores operated by third
parties since the launch of the product around
Two years after overtaking the United States in 2018. It is estimated that a self-checkout
as the world’s largest consumer market, China is machine would be able to do the job of three to
gaining pace in revolutionizing the retail-scape, six cashiers. Consumers could save 30 percent
with merchants hailing the dawn of the New Retail. on time while paying for their shopping. Citcon, a
New Retail refers to the integration, or interlinking, payment partner of Chinese e-commerce payment
of online and offline shopping using modern giant Alipay and WeChat Pay in North America,
technologies, data and customer engagement said it has partnered with more than 5,000 top
techniques. Although online retail will continue merchants in the US. The transaction costs via
to grow, the share of shoppers’ spending online Citcon would be as much as 40 percent lower
of their overall spending is expected to remain than that by international credit cards, without
at the same level. That means online retailers fraud and chargeback liability for merchants to
need to combine online-offline offerings in order accept Alipay and WeChat Pay. While Citcon works
to continue growth. The inevitable slowdown in to enable international merchants to accept
online shopping volumes has forced internet Chinese QR code-based mobile wallets in-store
giants to march into offline retail, which accounts and online, a number of banks operating in the US
for roughly 85 percent of China’s US$5.3 trillion are working with third-party payment companies
retail market. The adoption of mobile devices is to enable Chinese sellers to collect payments
a major factor in New Retail. By the end of 2018, from US e-commerce platforms like Amazon,
mobile commerce accounted for 55.5 percent of eBay, Wish and others. Bank of China’s New York
all retail e-commerce in China. Sales via mobile branch launched a cross-border payment system
commerce was roughly US$1.5 trillion in 2019, named e-MPay in 2016 in cooperation with a third-
representing a quarter of the country’s overall party payment processor. Chinese sellers with a
retail market. Changing consumer behavior is also presence on Amazon, eBay and other platforms
stoking New Retail. China’s tech giants are busy only need to pay around 1 percent of commission
throwing their hats into the ring. Data is the most fees now, lower than the previous 3 percent to 5
important element in redefining retail. With big percent, while business cycles have shortened to
data, multi-dimensional digital marketing can help one working day from one or two weeks, according
increase the monetization rate of advertisements to Bank of China’s New York branch. Chinese
as well as the conversion rate of the online and internet giants like Alibaba and Tencent are making
offline merchants with the platforms. In addition strides in cross-border payments in a bid to
to internet players, traditional malls are stepping facilitate Chinese tourists in their outbound travels.
up efforts to merge their offline and online
282
of local and imported products. That’s because resources. New Retail is the result of efforts to
the American giant takes the Chinese market find solutions to a key set of problems for each
seriously. Above all, Costco’s dramatic grand side. For the physical store chains, they have been
opening in Shanghai illustrates the importance unable to keep up with the growth of online retail.
of strategic preparation for the Chinese market. For the online operators, they have struggled to
Despite appearances, Costco isn’t exactly new keep delivery infrastructure capacity up with the
to China. It’s had a marketing relationship with rapid growth in online shopping demand. New
Chinese Internet giant Alibaba for five years. Retail means more connection and integration
During that time, it has offered online delivery, - not just for retailers, but also for consumers,
allowing it to build up its supply chain. On the other manufacturers and other industry players (China
end, it also increases brand awareness and create Daily, Online Meets).
expectations for Chinese consumers. Obviously,
Costco cleverly built up excitement around the Chinese e-commerce giants, gadget-makers
Shanghai grand opening—a strategy that has and financial solution providers are now shaping
clearly worked extremely well (Mourdoukoutas). the global retail sector. Alibaba has rolled out
more than 10,000 self-checkout machines at its
New Retail own offline stores and stores operated by third
parties since the launch of the product around
Two years after overtaking the United States in 2018. It is estimated that a self-checkout
as the world’s largest consumer market, China is machine would be able to do the job of three to
gaining pace in revolutionizing the retail-scape, six cashiers. Consumers could save 30 percent
with merchants hailing the dawn of the New Retail. on time while paying for their shopping. Citcon, a
New Retail refers to the integration, or interlinking, payment partner of Chinese e-commerce payment
of online and offline shopping using modern giant Alipay and WeChat Pay in North America,
technologies, data and customer engagement said it has partnered with more than 5,000 top
techniques. Although online retail will continue merchants in the US. The transaction costs via
to grow, the share of shoppers’ spending online Citcon would be as much as 40 percent lower
of their overall spending is expected to remain than that by international credit cards, without
at the same level. That means online retailers fraud and chargeback liability for merchants to
need to combine online-offline offerings in order accept Alipay and WeChat Pay. While Citcon works
to continue growth. The inevitable slowdown in to enable international merchants to accept
online shopping volumes has forced internet Chinese QR code-based mobile wallets in-store
giants to march into offline retail, which accounts and online, a number of banks operating in the US
for roughly 85 percent of China’s US$5.3 trillion are working with third-party payment companies
retail market. The adoption of mobile devices is to enable Chinese sellers to collect payments
a major factor in New Retail. By the end of 2018, from US e-commerce platforms like Amazon,
mobile commerce accounted for 55.5 percent of eBay, Wish and others. Bank of China’s New York
all retail e-commerce in China. Sales via mobile branch launched a cross-border payment system
commerce was roughly US$1.5 trillion in 2019, named e-MPay in 2016 in cooperation with a third-
representing a quarter of the country’s overall party payment processor. Chinese sellers with a
retail market. Changing consumer behavior is also presence on Amazon, eBay and other platforms
stoking New Retail. China’s tech giants are busy only need to pay around 1 percent of commission
throwing their hats into the ring. Data is the most fees now, lower than the previous 3 percent to 5
important element in redefining retail. With big percent, while business cycles have shortened to
data, multi-dimensional digital marketing can help one working day from one or two weeks, according
increase the monetization rate of advertisements to Bank of China’s New York branch. Chinese
as well as the conversion rate of the online and internet giants like Alibaba and Tencent are making
offline merchants with the platforms. In addition strides in cross-border payments in a bid to
to internet players, traditional malls are stepping facilitate Chinese tourists in their outbound travels.
up efforts to merge their offline and online
282
