Social commerce sales in China will make up 11.6% of total retail e-commerce sales in 2020 with nearly one-third of mainland Chinese becoming social buyers this year despite weaker consumption sentiment and slower economic growth amid the coronavirus pandemic.
Retail social commerce sales in the country will grow to US$242.41bil (RM1.03tril) this year and the number of social buyers is expected to reach 357.2 million, according to a report published on Thursday by research firm eMarketer.
“Covid-19 has negatively impacted all economic activity in China, including social commerce, which is why growth in 2020 is half of what it was in 2019,” eMarketer analyst Nazmul Islam said in the report. “The pandemic will be a bump in the road, but social commerce will continue to adapt and grow in China.”
With lockdown and quarantine measures having been imposed across the country to contain the spread of the virus, the pandemic became the catalyst for a major shift to online activities, ranging from remote working and online education to grocery purchasing. As part of that, social commerce – especially live streaming – has become a hot trend with traditional industries, and even tech tycoons, tapping into the new sales channel.
On Thursday Ding Lei, founder and chief executive of Chinese gaming giant NetEase, generated 72mil yuan (RM43.40mil) in sales that included lifestyle products on the company’s separate Yanxuan e-commerce platform, after a four-hour live streaming debut hosted on short video platform Kuaishou.
Gree Electric Appliances chairwoman Dong Mingzhu, known as China’s “home appliances queen”, sold 310mil yuan (RM186.89mil) of goods in a three-hour live streaming event on Kuaishou last month.
Alibaba, the country’s largest e-commerce platform and owner of the South China Morning Post, saw its gross merchandise volume (GMV) from livestreaming double in the first quarter compared to a year ago, while merchants using live streaming on the Taobao Live platform recorded an 88% year on year increase in sales for the first quarter.
Apart from livestreaming, mini-programs are also becoming an important part of social commerce. From March to May, service providers in China built more than 800 mini-programs on Alipay, the mobile payment platform operated by Alibaba, each with more than 10,000 monthly active users.
WeChat, the ubiquitous app run by Tencent Holdings, said there was a sharp increase in people using its platform to buy groceries and everyday food items in February. Users of an online supermarket mini-app saw growth of 115% year on year that month, when much of the country was in lockdown.
“China's population has the highest share of social buyers globally,” Islam said. “Many of the country's most popular e-commerce platforms are heavily integrated with the most popular social networks, boasting innovative services like Mini Programs and livestreaming commerce.” – South China Morning Post
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