E commerce in China

China is already home to the largest population of Internet users—457 million in 2010, more than in the United States and Japan combined. Internet access is affordable, thanks to government efforts to modernize the country’s telecommunications infrastructure. And among the growing segment of urban dwellers and those in the middle and affluent classes, shopping is huge. As a result, China is poised for an e-commerce explosion. Here is a breakdown of the astonishing online-shopping numbers.

• In 2010, the e-commerce market in China was worth RMB 476 billion as transaction value (actual value of sales, including all fees), nearly double that of Japan or the United Kingdom and a drastic increase from RMB 128 billion in 2008.

• E-commerce penetration has grown rapidly from a low level. Less than 10 percent of China’s urban population shopped online in 2006. That figure jumped to 23 percent by 2010, and will nearly double to 44 percent by 2015, quickly narrowing the gap with the United States and other developed markets.

• By 2010, China had 457 million Internet users, with penetration of 52 percent in urban areas and 18 percent in rural areas. The number of e-commerce shoppers will take off through 2015, growing from 145 million people to 329 million.

• An astounding 30 million consumers are expected to shop online for the first time every year until 2015. That’s a population nearly the size of Canada’s beginning to shop online every single year.

• BCG forecasts that e-commerce will go from representing 3.3 percent of total retail value today to 7.4 percent in 2015. In the United States, it took ten years to achieve that growth. Our projection means that China will surpass the United States to become the largest e-commerce market in the world, achieving a compound annual growth rate of 33 percent, to reach more than RMB 2 trillion.

The Boston Consulting Group:The next ecommerce superpower
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