What can the world learn from China’s e-commerce success?

21 January 2022

Oranges purchased off Chinese e-commerce sites are delivered to rural residents of Shimian County, Sichuan, China. China’s meteoric rise of e-Commerce in the 2010s was largely fuelled by strong demand for goods from rural citizens. (IMG / B.Zhou / Shutterstock)

Some may describe China’s e-commerce success as phenomenal, and they’d have good reason to. Barely two decades ago, China was but an emerging economy, where households would struggle to buy basics such as rice and work shoes — things those in developed nations take for granted. 

Despite political and trade friction between the growing global economic behemoth and the US from the 2000s onwards, in 2013, China’s e-commerce market of US$314 billion overtook the states’ US$255 billion. 

By 2015, China earned the distinction of becoming the world’s largest e-commerce market, holding 35% of e-Commerce transactions — in less than two decades.

China’s meteoric economic rise 

Admittedly, China’s economic success factors might be considered unique. It is well known that the country was able to leverage its massive labour economy to become the “factory of the world” once it opened its previously sheltered borders.

Yes, globalization — the phenomenon that has played a huge part in catapulting many a poor nation into relative economic success from the 80s and 90s onwards, was largely responsible for the development of the world’s poorer regions.   

Alas, this isn’t across the board, given the dynamism of the socio-political landscapes of different regions and countries. China, authoritative governance aside, was arguably relatively lucky to have somewhat stable governance without much strife or political interference, unlike say, the EMEA region.

From then to now, China’s largest issue is arguably more external than internal, such as the ongoing trade war with the US.

The global e-commerce market 

In 2020, 58% of the world’s e-commerce sales were owned by only six companies. And within those six, four are Chinese — making up 43% of the global e-commerce sales, according to Forbes.

According to Juniper Research, the value of global eCommerce payment transactions will exceed US$7.5 trillion by 2026, from US$4.9 trillion in 2021. 

This growth rate of 55% over these five years will be driven by retailers offering compelling omnichannel retail experiences that increase user eCommerce spending. 

Omnichannel retail is a model that provides end-users with the ability to access retail services, including sales and customer support, via multiple channels. 

Additionally, it found that there are increasing appetites for new payment methods within eCommerce checkouts — including Open Banking-facilitated payments and digital wallet one-click checkout buttons. Accordingly, it recommends that merchants ensure payment options match changing user expectations, or they will be rapidly left behind.

The research also forecasts that physical goods will account for 82% of the global eCommerce payments transaction value by 2026.

It urges payment providers to support BNPL (buy now pay later), an alternative payment method that integrates fixed installment plans and flexible credit in eCommerce checkout options, to capitalize on the continuing growth of eCommerce due to the ongoing global COVID-19 pandemic.

Learning from China’s e-commerce success

Globalization alone wasn’t enough to explain China’s success in e-commerce. According to Morgan Stanley, there were two key drivers — the rise of mobile phone ownership, as well as the high demand for goods from rural consumers. The developmental and infrastructural development between Chinese megacities and the rural countryside was nothing short of stark. The former would comprise multitudes of shopping centers and retail spaces, both virtual and brick and mortar.

As the physical spaces were inaccessible to the rural communities hungry for goods, the promise of shopping came in a newfound opportunity — online malls. And the catalyst for that?


Since then, the country has seen meteoric growth in e-commerce, fuelled not just by demand overseas, but by a hungry domestic market for goods such as fashion, electronics, and more. 

Another factor driving the behemoth that is the Chinese e-commerce market is a strong and robust technologically-sophisticated logistics systems. Chinese e-commerce giants Alibaba (parent company of Taobao.com) and JD.com possess highly efficient logistics networks.

Alibaba’s cross-country delivery companies can process up to 30 million items daily through their logistics arm, Cainiao, and JD.com provides same-day and next-day delivery through their “211 program”.

China's e-commerce tech UAV

ZHUHAI, CHINA – NOVEMBER 6, 2018: Alibaba logistics arm Cainiao displays its UAV at the 12th China International Aviation and Aerospace Exhibition 2018. Alibaba has been investing heavily in advancing its logistics operations over the years to more efficiently serve customers. Image source: testing, Shutterstock

Juniper Research’s study found that by 2026, China will account for over 37% of global e-commerce payments by transaction value, owing to its established and extensive e-commerce and payments landscape that provides greater convenience for users via easily accessible alternative payment methods. 

Juniper also recommends prioritizing digital wallets, Open Banking‑facilitated payments, and cryptocurrencies to emulate the e-Ccmmerce success experienced in China. 

To do so, it recommends that platform providers partner with specialists in these specific emerging payment areas to keep pace with changing merchant expectations around acceptance types.