The demand for imported goods is growing among cross-border shoppers

Consumers view ski equipment in a shopping mall in Beijing on January 2, 2023. [PHOTO by ZHAO JUN/CHINA NEWS SERVICE]

Chinese consumers have shown vibrant purchasing power for luxury and premium consumer goods, with their spending on foreign-branded and imported products becoming a major driver of increased consumption, according to industry insiders.

Li Yanchuan, President of Amazon China Global Store and Prime Store, said, “Young Chinese consumers, especially Generation Z, use independent thinking and judgment when choosing brands, and prefer to pursue niche lifestyle and personalized products.”

Li said the “stay-at-home economy” has revitalized more consumption scenarios and needs, and shopping for healthy, quality products has become the new norm.

“Beauty, personal care and apparel were the most popular categories among consumers in online cross-border shopping,” he added.

Li said that the sales of fishing, skiing, camping and other outdoor sports products have been growing rapidly, while VR equipment, hand-drip coffee products, tableware and kitchenware with unique designs have seen increasing demand from Chinese shoppers in recent years.

He added that online cross-border shopping orders are still mainly placed in first-tier cities. However, residents of second and third tier cities showed a rapidly growing purchasing power. Li said Amazon will enrich cross-border shopping scenarios based on consumers who share similar interests and hobbies.

The first front-end customs warehouse of Amazon Global Store will start operating in Ningbo, Zhejiang Province, this year to better serve Chinese consumers’ demand for imported products.

In 2021, China has become the largest market among Amazon Global Store companies worldwide, with sales increasing more than nine times compared to 2015.

The company stepped up its localization push in China by launching a WeChat applet in 2019. This software is specifically designed to build a social commerce experience for Chinese consumers, covering areas such as live broadcasts, social networking, and content.

China’s cross-border e-commerce has grown exponentially in recent years. Statistics from the General Administration of Customs show that the import and export volume of this e-commerce reached 1.98 trillion yuan ($292.8 billion) in 2021, an increase of 15 percent year on year.

“Cross-border e-commerce penetration in lower-tier cities and towns has increased in recent years. Chinese consumers have shown increased demand for diversified, personalized and specialized products from overseas,” said Chen Tao, an analyst at online consulting firm Analysys in Beijing.

Chen added that online shopping via live broadcasts is very popular among the generation of consumers after the 1980s and 1990s.

According to a report by the Institute of Consumer Research and Industry Development of China’s e-commerce platform, imported brands, including mobile phones, personal care products, cosmetics, watches, eyeglasses, baby and maternal goods, nutrition and health care products, are gaining popularity among Chinese shoppers.

People in the 26-35 age group are the main consumers of imported products, accounting for nearly 50 percent of all age groups. In addition, consumers between the ages of 46 and 55 contributed to the fastest growth in the purchase of imported products.

Imported items gained traction among consumers during last year’s Singles’ Day shopping carnival. In the first 10 minutes of the promotion, which started at 8 pm on October 30, the product turnover of JD’s virtual national booth, covering overseas brands from more than 90 countries, increased more than 12 times year on year.

Liu Hui, director of the Institute of Consumer Research and Industry Development of JD, said that foreign brands should pay more attention to lower-tier cities, accelerate digital transformation, and design and launch more different products to better meet the diversified needs of consumers.

Market consulting firm iiMedia Research said that with China’s further opening up, the gradual improvement of logistics and delivery services, and the rise of people’s income, the demand for imported goods will continue to increase and will provide a significant impetus for consumption upgrade.

“With the increase in domestic demand and advances in emerging retail technologies, China has introduced preferential policies, such as lowering import taxes and expanding the range of goods allowed to be imported,” said Zhang Tianping, president of Deloitte’s Consumer Products and Retail Industry Division in Asia Pacific. “This has led to an increase in Cross-border e-commerce imports despite the COVID-19 pandemic, underlining a period of rapid growth for the country’s imported goods market.

The celebrity live broadcast boom has stimulated cross-border e-commerce purchases by domestic consumers. Moreover, overseas brands are moving to cross-border e-commerce platforms as they expand their distribution channels after disruptions in offline retail, Zhang said.

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