Looking to the East: The Future of e-commerce

By Kevin O’Farrell, Associate Vice President at Analytic Partners

2020 was a game-changer for e-commerce in Europe. Brands and retailers have surged towards digital channels and omnichannel marketing has become a true buzzword. Some of our clients have seen their e-commerce sales double after just a few weeks.

But even though everything digital has been accelerated in our realms, China is still leading the way in terms of e-commerce and omnichannel retailing. Single’s Day is easily the largest shopping holiday in the world, and in 2020 after months of lockdowns and strict regulations, Alibaba and JD.com sold over $115bn in China alone, or just below $80 per capita, setting new sales records by almost doubling their 2019 e-commerce sales. For some brands such as Nike, the upward revenue trend in China came at exactly the right time to turn around the global revenue trend.


There is still a lot to learn from the Chinese ways around ecommerce and omnichannel retail for European and other Western brands. What trends have we seen and how can they be adapted to facilitate growth beyond the Chinese border? We have gathered information from our European and Chinese teams to create an outlook.


For years, marketers have witnessed the rise of mobile-first in China and the pandemic has accelerated this trend even further. According to the findings of the QuestMobile report for Q1 2021 (as reported on WARC), mobile phone usage has surged due to many workers being forced to stay in their hometowns and not commute. This has led to an increase in net mobile users of 17 million more people. The average mobile internet user in China now spends more than seven hours a day online or about 90 minutes more than a year ago.

Alibaba and JD.com had realized this trend long before promotions started. “Both see it as a way to acquire new customers and the companies have been focusing on so-called lower-tier Chinese cities which usually have more price-sensitive consumers. The e-commerce giants see this as a critical part to their growth strategy.” (via CNBC article)

Mobile usage is steadily increasing in Europe as well. Brands need to link their marketing activities to consumer behaviour and adapt faster when changes arise. For example, when it comes to omnichannel marketing, we’ve seen Amazon act as a search engine and great driver of ROI in one of our latest ROI Genome reports. Brands using this as a marketing channel as well as a sales channel can experience.

Pay as you go

If mobile phones are the gateway to omnichannel retailers, mobile payment is the next logical step offering them an easy way to pay for their purchases wherever they are. Chinese consumers are miles ahead of the rest of the world when it comes to shopping via their cell phones, both in terms of buying on mobile and in using mobile payment apps for online/in-store purchases. There is no need to take a wallet when going out, just a mobile phone. Marketing channels are integrated on them and even out-of-home ads have barcodes to scan which lead consumers on a path to converge.

As a recent Economist article mentions, one of the key differences is the platform ecosystem and in particular the existence of super-apps like WeChat. The app combines all features that the Western World would use separately, for services such as shopping, networking and, of course, payment.

The smooth transition between services helps to improve and simplify the user experience and has been in place for a while now in China. While watching their favourite influencer on social media they can instantly purchase on another platform. YouTube has just recently announced that they will add shoppable ads to their videos to create a better shopping experience for viewers and influencers alike.

New dynamics between brands and actual needs

Another trend across all regions is the omnichannel experience with D2C brands opening physical stores and historically physical stores heading further into ecommerce and D2C. However, this trend seems even more dynamic in Asia. Walmart has recently announced an expansion of its on-demand retail offering in China to quickly serve the new dynamics within the market.

In China, the world of ecommerce, previously dominated by the ecommerce search engines JD.com and TMall, has also been shaken by new competitors and their sophisticated business models responding to and also creating new consumer dynamics. Platforms like Meituan and Pinduoduo have developed social shopping experiences optimized for efficiency, funnel conversion, and purchase rates, but also looking to make the shopping experience more fun and engaging.

All Chinese ecommerce platforms are unique ecosystems that support both the need-driven consumer decisioning process and the brand-driven marketing approach. They have various innovative marketing channels (e.g. Brandzone, Target Banner, Super Recommendations) to drive short-term traffic and address immediate needs. It also supports branding media channels inside or outside platforms (e.g. TMall Weibo, Douyin, Xiaohongshu) to land the purchase in TMall. In some cases, consumers even uses these ecommerce platforms as a source to learn about the brand but then convert offline after doing the research.

Learnings: a growing trend

There are no super-apps in Europe and flawless experiences are rather seldom. Recent development in the e-privacy laws and antitrust movements against big tech also make it a lot harder in Europe to ever reach such a super-app status. Moreover, the loss of the third-party cookie is making it even harder for advertisers to target the right audience. But brands can still benefit from adapting faster to consumer behaviour and driving innovation.

Consumer behaviour is highly influenced by those privacy concerns and regulations, also due to the previous education on how a business should serve them. But as outlined above there are things we can learn from China and that we can adapt for our own market, and that’s why we need to keep on looking out for new trends and marketing tactics such as a better omnichannel experience.

Optimizing the omnichannel experience should be a priority for every company right now. A first step should always be a holistic view of the business, free from siloed thinking and completely in line with what the customer would want to have as their omnichannel experience. Building a measurement program on top of that will help businesses identify the true business drivers and get insights on both offline and online touchpoints. Adding touchpoint analytics to this helps to identify the path a consumer takes without relying on cookies.

Brands that are looking to expand or invest further into China should be aware of the market dynamics and act accordingly. We are seeing a need for Commercial Mix Modelling to capture the branding media inside and outside of TMall because many purchases are coming from social platforms that can’t be tracked with last-click attribution reporting.

Even though it might look like an interconnected world, China also has enormous potential when it comes to omnichannel marketing. A lot of brands are focusing on the impact of digital channels on ecommerce, not on brick & mortar stores. However, over >70% of retail sales are still generated offline which shows the immense opportunity that still exists in the market.