Decoding The E-Commerce Landscape in China, India And Japan
When it comes to the e-commerce landscape in Asia, one size doesn’t fit all. Our recently published e-books for the China, Japan and India markets explore trends and opportunities for Asia Pacific SMEs.
- Asia Pacific is home to some of the most advanced and dynamic e-commerce markets in the world.
- International sellers trying to enter these markets need to consider a whole host of factors for success, from local payment platforms to social media strategy.
- To support e-tailers looking to expand, FedEx has published new e-books that examine the e-commerce market, trends and landscape in three Asian economies.
At its core, global e-commerce gives retailers the opportunity to attract customers thousands of miles away from their hometowns. Many new businesses are ‘born-global’ retailers thanks to e-commerce. However, the challenges faced by international brands entering major markets, particularly in Asia, should not be underestimated.
Beyond language barriers: the challenges of cross-border commerce
Asia Pacific is home to a number of highly mature cross-border e-commerce ecosystems. But some of the most strategically important markets are arguably the most complex. China, India and Japan are among these, for reasons of language, culture and size. Understanding local market nuances in each is crucial for success.
At FedEx, we’ve recently published an e-book for each market, designed to help e-tailers considering market entry understand the landscape, challenges and opportunities.
If you’re a global merchant keen to tap the opportunities these top markets represent, you can download our e-books now. I also share 4 key focus areas SMEs should be considering below:
At FedEx, we’ve recently published an e-book for each market, designed to help e-tailers considering market entry understand the landscape, challenges and opportunities.
If you’re a global merchant keen to tap the opportunities these top markets represent, you can download our e-books now. I also share 4 key focus areas SMEs should be considering below:
1. Getting the geographic fundamentals right
Many international brands incorrectly presume that language is the biggest challenge to building a successful e-business in each market. This is a misconception. Overseas merchants need to grasp the unique digital landscape and formulate their business strategy accordingly.
In China, consumers are unevenly distributed across the country. East and South China account for over 50% of Chinese cross-border e-commerce consumers, with around 30% located in Beijing, Shanghai, Guangzhou, and Shenzhen.
Instead of trying to cover the entire market, international e-tailers should prioritize metropolitan areas first. Later, they can explore the best times to expand to other areas in the country.
In China, consumers are unevenly distributed across the country. East and South China account for over 50% of Chinese cross-border e-commerce consumers, with around 30% located in Beijing, Shanghai, Guangzhou, and Shenzhen.
Instead of trying to cover the entire market, international e-tailers should prioritize metropolitan areas first. Later, they can explore the best times to expand to other areas in the country.
Promising markets with huge numbers of consumers invite fierce competition, especially from incumbent local brands. Overseas sellers should determine where the biggest competition is coming from, and which sectors are currently underserved. For example, in Japan, the fashion industry is highly competitive, with some Japanese brands leading globally.
2. Build forensic knowledge of e-commerce and social platforms in each market
Some overseas brands assume that US-based, international marketplaces like Amazon and eBay are effective sales channels. In most cases, those platforms aren’t as popular as indigenous counterparts built specifically for the needs of that market.
Examples of key players in Asia include Taobao, Alibaba and JD.com in China, Rakuten in Japan, and Shopee and Lazada across Southeast Asia.
SMEs also have to establish a presence on leading local social media channels in each market. For example, brands eyeing the Chinese market can’t get far without building a presence on WeChat and Xiaohongshu, and becoming familiar with promotional livestreaming. A lack of familiarity with this complex market prompts many overseas sellers to engage local marketing teams to help promote their business.
Examples of key players in Asia include Taobao, Alibaba and JD.com in China, Rakuten in Japan, and Shopee and Lazada across Southeast Asia.
SMEs also have to establish a presence on leading local social media channels in each market. For example, brands eyeing the Chinese market can’t get far without building a presence on WeChat and Xiaohongshu, and becoming familiar with promotional livestreaming. A lack of familiarity with this complex market prompts many overseas sellers to engage local marketing teams to help promote their business.
3. Take time to understand peak seasons and triggers for spikes in sales
A tailored marketing strategy is critical to engaging cross-border customers.
Consumer appetites and sales patterns vary across markets. Mega markets like China, India and Japan, all look very different. Some of the hottest e-commerce seasons in China are Singles Day (Nov 11) and Couples Day (Dec 12).
In Japan, there are peak shopping seasons at Japanese new year, mid-year, and year-end. India’s peak season is often driven by Diwali. E-commerce merchants need to plan their marketing campaigns in advance for these important moments.
In Japan, there are peak shopping seasons at Japanese new year, mid-year, and year-end. India’s peak season is often driven by Diwali. E-commerce merchants need to plan their marketing campaigns in advance for these important moments.
4. Get set up for local payment systems
Local payment systems are a crucial point to address in the customer journey. International credit cards or Apple Pay may not be as common or convenient in Asian countries. WeChat Pay and Alipay dominate the China market, and many consumers here do not own any international credit cards.
In Japan, credit cards are the dominant payment tool and the JCB credit card is more popular than other networks. India offers mobile payment options such as UPI and Paytm. Without enabling the most popular payment options for local consumers, SMEs will never be able to penetrate overseas markets.
In Japan, credit cards are the dominant payment tool and the JCB credit card is more popular than other networks. India offers mobile payment options such as UPI and Paytm. Without enabling the most popular payment options for local consumers, SMEs will never be able to penetrate overseas markets.
The right local market insights are key to successful cross-border business strategies
Digital channels lower the barriers to market entry, but the best business strategies are underpinned by super-smart local market insights. Finding new customers internationally is a goal for many SMEs aiming to drive revenue growth, but without boots on the ground, finding reliable partners to support cross-border efforts is essential.
An advantage of our decades-long presence in Asia Pacific is that we’re fully embedded in the e-commerce ecosystems of each market. We’ve built specialist, local knowledge that can be applied by businesses of all sizes looking to transform their e-commerce offerings.
Using these insights, our three latest e-commerce handbooks aim to give SMEs eyeing China, India or Japan a basic understanding of doing business there.
And as a key logistics player, we’re also integrated into platforms and processes that provide a seamless experience for both merchants and consumers. With unique viewpoints and the latest local know-how, we help e-tailers operate more effectively to enter new overseas markets. With our ongoing support, we hope to help local economies and small businesses thrive.
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Senior Vice President,
Marketing & Customer Experience, Asia Pacific, FedEx
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