Post-Pandemic eCommerce: A Look at the State of Online Sales in China

If you gently learn your head towards the window into the future, in order to catch a glimpse of what a post-pandemic world may look like — in terms of retail and ecommerce — you’re going to be looking at the current state of China.

And the reason why you’d be looking at the Middle Kingdom is that after the outbreak of Covid-19 from the east-central province of Hubei, it was also one of the first places that seemingly eradicated the virus, having ended their lockdown in April, and after a brief resurgence in May and hard re-lockdown, things have settle down into an everyday life similar to before the pandemic — so much so that recently the capital of Hubei, Wuhan, hosted a huge pool party.

Besides the water-fuelled partying, we’re able to see how customers are shopping in a post-pandemic scenario. And for brands and retailers driving harder and deeper digital strategies, the sweat and tears that have come from a sharp refocus of business strategy — or at least a doubling down on it — seem to be well worth it, which stresses the importance of optimizing ecommerce via leading platforms such as Salesforce Commerce Cloud.  

Quarterly jumps in June

China’s big ecommerce players have been bagging the benefits from the increased amount of customers shopping online, as well as from companies that drove deeper digital experiences and delivery capabilities. And people have continued to shop online after lockdown.

Total retail sales dropped dramatically in January and February, typically big spending months in China due to the New Year. Yet strong revenue returned during Q2, particularly for JD, Alibaba, and Meituan Dianping, as the world’s next largest economy emerged out of lockdown.

Take Meituan Dianping, for example. With its headquarters in Beijing, the country’s largest delivery service platform netted $319.5 million (2.2 billion yuan) in Q2, compared to a loss of $229 million (1.58 billion yuan) in Q2. Its second quarter revenue was a year-on-year increase of 152%.

Meanwhile, Alibaba saw Q2 revenues of just over $22 billion (153.75 billion yuan), a climb of 34% from the same time last year.

And regarding JD — the closest rival to Alibaba although it far outpaces it  — income for Q2 topped $2.32 billion (16.5 billion yuan), marking an extreme year-on-year increase of 2,500%.

The post-pandemic environment in China sees further and deeper digital acceleration as the previously slow and steady shift in emphasis from physical to online received an ecommerce jolt which is evidenced in the second quarter.

However, there are important issues that have remained because the resurgence of ecommerce has not been equal among all industries. Despite strong recoveries in goods like food, medicines, and cosmetics, other categories of goods have been much slower, such as automobiles, office supplies, and building and decoration materials. There have even been some categories that remained below water, such as clothing, jewelry, and gas, in addition to hotel and travel.

Accelerated online migrations has helped many brands and retailers keep their heads above water, and turn a crisis into opportunity.

In the West we should expect a similar pathway coming out of the pandemic and settling into a similar ecommerce environment, in which platforms such as Salesforce Commerce Cloud are able to leverage the latest tech to deliver top digital shopping experience that are focused on personalization — to build a stronger customer loyalty base and drive sales — and mobile — where an increasing number of us are using to shop whether it be at the research stage or purchase stage.

PS: UV is one of the world’s leading Salesforce B2C Commerce Cloud dev teams. Contact us to see how we can work together.