Mcommerce surges in China

30 August 2011

BEIJING: Mobile commerce is rapidly gaining ground in China, where growing numbers of consumers and retailers are displaying interest in this channel.

Analysys International, the research firm, reported that sales made through this route hit 1.67bn yuan ($261m) during the second quarter of 2011, an improvement from 880m yuan a year earlier.

More specifically, 1.2bn yuan of revenues generated between April and June 2011 were attributable to purchases from the mobile web, and 27% to mobile transaction terminals installed on wireless devices by retailers.

Analysys International also stated smartphone sales stood at 16.8m units in China in Q2, increasing from 13.5m year on year and aiding the sector's growth, Chen Shousong, an analyst at the company, argued.

"It can only be a supplement to the traditional distribution channel in the short term because businesses need to develop mobile terminals. It will take time," Chen added, speaking to the China Daily.

Yihaodian, an ecommerce pioneer now part-owned by Wal-Mart, recently tested digital "shopping walls" in 70 of Shanghai's underground stations, and has used 500 billboards for the same reason in Beijing.

These tools enabled consumers to acquire goods by scanning codes featured on digital "display shelves", with products then delivered in 24 hours.

Yu Lili, director of Yihaodian's wireless application department, said: "The technology is sufficient to support the development of mobile commerce. The number of smartphone users is increasing, but it is not as high as it is in developed countries, so it will take time for the business model to develop."

"We have made plans to have permanent shopping walls installed in large cities in the next few years, and we may consider having the virtual supermarkets installed in local communities."

Elsewhere, 360buy, another ecommerce retailer, saw some 1m downloads of its mobile transaction terminal tool in the first quarter of 2011, as daily sales reached an estimated 2m yuan by the end of June.

Jiepang, a location-based mobile operator similar to Foursquare, is also partnering with 3,000 stores in six cities to roll out near field communications (NFC) wireless payment services allowing traders to set the offers customers receive when "checking in".

"NFC has a lot of possibilities for mobile commerce," Leo Lee, Jiepang's marketing and business development manager, said. "We want to help small, medium and local merchants to use our platforms."

Data sourced from China Daily, NFC World; additional content by Warc staff