Alibaba has this Chinese New Year started to conquer the rural markets, one of the few in China where the majority is not yet online, says retail analyst James Roy in Channel News Asia. One of the key products is imported food, as many Chinese mistrust locally made food.
Channel News Asia:
Analysts said the focus on regional specialties this Lunar New Year is part of Alibaba’s all-out attempt to capture the largely untapped rural e-commerce market.
“The majority in the cities are already shopping online. Despite lower internet penetration rates, the rural areas represent a huge untapped market and Alibaba has been working to expand its logistics network in these parts of China,” James Roy, associate principal at China Market Research Group (CMR), said in a telephone interview.
“The real purpose of Alibaba’s campaign is about encouraging rural farmers and consumers to warm up to the idea of e-commerce,” Shanghai-based Mr Roy added.
According to CMR, increased demand for imported food is part of a larger trend among Chinese consumers who are willing to pay a premium for Western experiences. A series of food safety scandals since 2008 sapped consumers’ confidence in locally-produced baby products, prompting young Chinese parents to look abroad.
“Apart from fear of poor food quality, people are exposed to more things as they travel, and they get more adventurous with tasting new food. Consumers, especially women under 40, are also becoming more health-conscious. It’s not just about having a well-balanced diet, but they are reading up on nutrition and looking at super-food,” Mr Roy said.
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