The Luxury Boom
No matter the pandemic, the Chinese luxury market increased by 48 percent in 2020 to approximately $52 billion, according to management consulting firm Bain & Company in its annual China luxury report, prepared in partnership with Alibaba’s Tmall Luxury Division.
Spending on luxury items continues to lag in the USA and Europe due to the pandemic, but it is recovered in China. A decrease in international travel by wealthy Chinese nationals has increased online luxury goods purchases. The pandemic also affected”daigou” agents, professional shoppers who travel overseas to buy popular cosmetics and luxury goods and resell them in China. The nation’s luxury online penetration rose from about 13 percent in 2019 to 23 percent in 2020, according to the Bain report.
China has worked a duty-free shop on the island of Hainan for a few years. But firm took off in 2020, driven by Covid-19 travel limitations and appealing shopping policy changes, such as a 300-percent profit in the annual duty-free quota per individual. As a result of this, Hainan’s duty-free earnings surged 98 percent in the first ten months of 2020.
Hainan currently accounts for 55 percent of low-income earnings in China. When they don’t exhaust their annual duty-free credits, visitors to Hainan can make additional purchases online and receive the things through home delivery.
Ecommerce in China
China is the world’s largest ecommerce market, propelled by ecommerce subsidiaries of the Alibaba Group — Taobao, Alibaba, and Tmall — also rivals JD.com and Pinduoduo. Research firm eMarketer estimates that Alibaba marketplaces and JD.com and Pinduoduo is going to have a hefty 83.6 percent of the retail ecommerce market in 2020.
Statista reports that China has the largest online ecommerce population, with 710 million people shopping sensibly. Seventy-six percent of digital shoppers are between the ages of 18 and 44. In agreement with Statista, 64 percent of China-based internet users take part in ecommerce, with apparel and accessories and toys and hobby items the most popular products.
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Statista estimates that consumers in China will invest $1.1 trillion on line annually, up from $826.6 billion in 2019, which was more than double the United States’ second-place position of $360.0 billion and the E.U.’s $351.9 billion.
2019 Ecommerce Sales: China, U.S., E.U.
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U.S. $ billions
PRACTICAL ECOMMERCE | Source: Statista
View as data table, 2019 Ecommerce Sales
: China, U.S., E.U.
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U.S. $ billions$862.6$862.6$360$360$351.9$351.9ChinaU.S.E.U.2019 Ecommerce Sales: China, U.S., E.U.PRACTICAL ECOMMERCE | Source: Statista
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