China will be a huge online market

IN POSSIBLY THE most obvious findings ever exposed in a report, the Boston Consulting Group (BCG) has said it reckons China could become a huge market for Online shopping in the near future.

Using the rather arbitrary assumption that China’s 210 million-plus internet users spend 2.7 hours a day online each, the BCG comes to the astounding mathematical conclusion that 570 million hours of Chinese web surfing is happening daily. Wow. We wonder whether the BCG boffins needed a calculator for that one.

BCG noted that last year, 47 per cent of China’s population – some 615 million souls – used some sort of digital device, like a mobile or PC. BCG, after supposedly crunching numbers for months on a massive supercomputer, have decided that by 2015 this number should reach 87 percent, or 1.2 billion bamboo surfers.

Michael Meyer, BCG's managing director, noted that the Chinese had different digital habits to the West, saying, "Chinese use online chats and text messages much more than Western people, who use e-mail as their major means of online communication."

This difference is probably causing ad executives many a sleepless night trying to figure out how to best corner the Chinese Online market. BCG believes that in 2016 (for lack of a better year), the Chinese online ad industry could have reached about 85 billion yuan ($1.24 billion).

However, after positing these figures, BCG’s Meyer hedged his bets a bit saying, "We can't estimate what percentage online advertising will account for in the whole advertising industry, but now it takes only a small portion and so does online advertising revenue. Our estimate is conservative."

Something which seems to bother BCG quite significantly is that only 28 per cent of Chinese said they were willing to shop online, compared to 71 per cent of Americans. The fact that an average worker in China gets a salary of about $12,642 a year, while their US counterparts make $104,606 a year might be one of the reasons. But we’re not half as clever as the BCG, so we’re just hypothesising really.

Interestingly, the reasons most Chinese consumers gave for being reluctant to shop online was concern over vendors' reliability, possible loss of personal information and product quality.

Hmmm….made in China? µ

L’Inq
Xinhua