China set to overtake US in e-commerce (2)

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China set to overtake US in e-commerce (2)

(China Daily) 08:43, August 29, 2013

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Given a choice, 82.9 percent of shoppers would prefer an e-store with a brick-and-mortar presence over pure play sites like Jingdong Mall, which only runs digital stores.

"This indicates a significant growth opportunity for omni-channel merchants," said Hoffmann.

He identified two reasons for shoppers' preferences. One is the "touch and feel" of a physical shop. In general, Chinese consumers lack confidence in merchants because they are worried about being sold fake or low-quality products, especially online.

A majority of these shoppers also cited offline after-sales service and a general comfort level with physical merchants.

The survey found that websites successfully feed store sales. More than 60 percent of shoppers said that a retailer's e-store will increase their spending at the same retailer's brick-and-mortar stores.

Building a dedicated digital team and investing in a world-class website are critical to grab a foothold in the e-commerce territory. Hoffmann cited Uniqlo Co Ltd, the Japanese apparel brand, as an example of how to streamline entry into China's digital retail market.

Uniqlo outsourced development of websites for both its e-stores (the official Uniqlo site) and another on Tmall.com.

Hoffmann said that outsourcing accelerated Uniqlo's online launch by tapping into Tmall's knowledge, reducing IT costs and allowing the company to utilize its partner's established logistics and distribution systems.

Hoffmann suggested that 20 percent of the online products should be "special" ones, with the same price in stores that are not available to pure plays.

About 30 percent of online merchants offer the same price as stores but with different coding, which limits price comparisons.