Samuelson, the famous economics master, said: “The final two masters of the market economy are consumers and technology.” In the past, consumers consumed more to meet their own actual needs and tended to buy products with high cost performance. Or promote products, that is, spend the least money to buy a product that meets your needs.
With the improvement of consumption power, some consumers are moving towards quality consumption: between the “Diaosi economy” and “symbolic consumption”, they not only stay at the purely practical level, but also do not blindly pursue With famous brands around you, you can better demonstrate your personality and values, and develop from meeting basic life needs to demonstrating personal taste and personal emotions.
The user group is generally highly educated, showing the characteristics of “slightly lower frequency” but “higher unit price per customer”. Thirty percent of cross-border online shoppers purchased 3 to 5 times in 2016. The frequency was 76% of domestic online shopping, but the unit price per customer was twice as high. The phenomenon of consumption upgrading and the market share of high-end single products have increased significantly, especially in health-related categories.
First, product quality. Consumption awareness has increased. Out of concern for safety, health, and authenticity, the “trust crisis” has forced consumers to shop overseas. In 2008, due to the melamine incident, Chinese people lost their trust in domestically produced milk powder and began to purchase imported milk powder from Europe and the United States. German Aptamil and Dutch Nutrilon were sold out for a long time.
In 2014, it was revealed that domestic brand sanitary napkins contained fluorescent agents, and brands such as Laurier, COSMO, and NaturaMoon from Japan became search keywords for overseas shopping that year. Health comes first. Consumers pay far more attention to quality and safety than price. The three major categories of maternal and infant products, cosmetics and health food have always accounted for the mainstream imports.
In the 2015 “Double 11”, Tmall had more than 5,000 overseas brands participating, of which maternal and infant sales accounted for 30% and beauty products accounted for 22%. Such shocking counterfeiting and counterfeiting have forced consumers to remain angry about domestic products and go to the official websites of major overseas brands to purchase. European and American countries impose severe penalties on counterfeit goods, and even include food and supplies safety in criminal laws. In addition, labor is scarce and expensive. There is absolutely no one in the United States who would make a pair of fake Nikes regardless of the cost.
The second is to improve consumption capacity and pursue quality consumption. The main force of cross-border consumption – the rise of the middle class, rising income, appreciation of the renminbi, improvement of living standards, upgrading of consumption concepts, rising number of outbound tourists and students, better understanding of foreign products, and more attention to the quality and diversity of life.
In 2015, my country’s per capita GDP was approximately US$8,000. The number of people with middle-class consumption capacity reached 300 million in 2016, reaching the level of moderately developed countries, and consumption upgrades are gradually booming. The effective supply of domestically produced categories, functions and user experience is insufficient, and new overseas supply “releases” consumption potential.
Accessory luxury goods, toilet seats, cooking utensils and various imported daily necessities are hot-selling on C2C platforms. First-tier cities such as Beijing, Shanghai, Guangzhou and Shenzhen are the main force in cross-border imports. Among the top ten shopping cities, Shanghai ranks first, accounting for 12% of the country’s transactions, followed by Beijing, which accounts for 11%, followed by Hangzhou, Guangzhou, Shenzhen, Chengdu, Nanjing, Wuhan, Tianjin and Suzhou. The group’s consumption power exceeds that of domestic e-commerce companies, and the average price per customer is high.
The third is the price difference (tax). Since the retail price of foreign brands (especially luxury goods and cosmetics) in China after import is significantly higher than the purchase price overseas, even taking into account the postage tax and logistics costs of overseas shopping, the price advantage is obvious. In fact, the biggest price difference when shopping overseas is tax.
The price difference between offline imports and e-commerce is significant, mainly due to tax policies, shortened channel levels, brand price discrimination, etc. 60% to 70% of the price difference comes from import taxes. With the growth of the domestic luxury goods market slowing down in the past two years, consumption becoming increasingly rational and the rise of e-commerce globalization, the differentiated pricing of foreign brands has become unsustainable, and global pricing of high-end brands will be the general trend.
Fourth, demand is diversified. New consumers born in the 1980s and 1990s who shop through the Internet, have a broad vision, and pay attention to the quality of life. They are well-educated, have stable incomes, and are young. They are defined as iConsumers “new era consumers” 2. Most of them have undergone Shopping overseas.
With the rise of consumerism, consumers’ purchasing needs have gradually shifted from standard products to personalization and differentiation. Their consumption has become bolder and their sensitivity to price has declined. From high-end luxury goods or From large-ticket items to daily necessities such as toothbrushes, cups, and nail clippers. Some brands and products are only available abroad, and preferred products are scarce and have not been introduced domestically.
The fifth is the facilitation of online shopping platforms, payments and logistics. Merchants intend to strengthen promotion. Related import websites have easy-to-understand discount information and overseas shopping tutorials. Consumer groups share overseas shopping experiences through online social circles. . Just one Meiya Prime direct mail can cover all aspects of life.
2013 was an inflection point. In this year, China’s overall e-commerce market transaction volume exceeded that of the United States, and mobile e-commerce even reached twice that of the United States. The cultivation of the consumer market has begun to bear fruit, and the number of consumer groups in second- and third-tier cities has begun to increase significantly. Many platforms have spent huge sums of money on large-scale publicity and promotion.
In 2010, only 3% of private consumption came from online, but by 2015 this proportion had increased to 15%. It is estimated that by 2020, online shopping will reach nearly 10 trillion yuan, accounting for 24% of total private consumption. E-commerce platforms have brought great convenience to Chinese users’ cross-border consumption and greatly lowered the threshold for domestic users’ cross-border consumption. As user demand is further released, the import market will continue to maintain rapid growth.