45% of Chinese respondents purchase most of their luxury goods online according to a research conducted by KPMG. 61% will buy high-end outbound travel products online and 28% will buy cross-border luxury goods.
China’s e-commerce market has surpassed the US as the largest e-commerce market in the world since 2013. Although the annual growth rate tends to slow down, the whole market is predicted to reach US$1 trillion by 2018 or 2019 basing on KPMG. The number of cross-border online shoppers in China is expected to reach 35.6 million by 2018 and total 1 trillion yuan (US$o.16 trillion) according to Chinese Commerce Research Center.
Per capita average spend in recent three online orders are 2,300 yuan (US$358.75) in 2015 increasing by 28% compared to 2014. The maximum budget for each order is 4,200 yuan (US$655.11) in 2015 compared to 1,900 yuan (US$296.36) last year. And online luxury buyers are willing to spend more on most categories.
Among the popular online shopping goods, the average spends on men shoes, glasses and children clothing decline this year. Cosmetics, bags, women clothing and women shoes sell best.
Apart from goods, online luxury buyers are predicted to purchase more high-end services online especially travel products and skin-care products increasing greatly.
Women prefer to buy cosmetics, jewelry, accessories and home decorations online and men like buying beverage drinks, automobiles, glasses, and watches. Shoppers aged 30 to 39 years old spend more online. Women spend most on cosmetics and hotel reservation and men spend most on hotel and restaurant booking.
Generally speaking, online luxury purchasing is influenced by consumers’ monthly income. First-tier and second-tier cities shoppers spend more online compared to buyers in small and less-developed cities. Most online luxury buyers gain over 5,000 yuan (US$779.90) in each month.
45% luxury shoppers will buy most luxuries online and 15% buy all the goods online. Online luxury purchasing has become more acceptable among China’s consumers than ever.
Many luxury buyers know of the goods through online shopping websites or stores and fashion websites or social media. 62% will try it in offline stores and shop online. 48% will get basic information online and purchase finally in physical stores.
One to four days are the shopping period with highest trade rate after consumers making up their minds in shopping and about 41% will spend more than one week.
About half luxury buyers will refer to comments online and compare similar products to help them make decisions. 36% will go to bricks-and-mortar shops to have a try and 24% will ask their friends for help.
Consumers usually visit official websites, domestic shopping platforms and cross-border online shopping platforms however 72% will finally buy through domestic online shopping websites.
Mobile internet users have been more than PC internet users since July 2014. Mobile luxury buyers increase in 2015 although the growth rate is lower than that of PC because that mobile phones are convenient to carry on and can function well just as PC does. Retail sales through tablets, smartphones and other mobile devices in China are expected to increase by 85.1% annually to US$333.99 billion in 2015, accounting for 49.7% of China’s retail e-commerce sales according to eMarketer.
48% respondents once bought cross-border luxury goods in the past 12 months and 67% increased in cross-border luxury purchasing. About 28% luxury orders are cross-border products. 9% luxury consumers bought most of their goods from overseas countries.
China luxury buyers with higher income have a higher ratio of conducting cross-border luxury products purchasing in the past 12 months. 65% luxury shoppers with monthly income over 50,000 yuan (US$7,798.97) buy cross-border products while only 35% with a monthly income of 5,000 yuan (US$779.90) purchase cross-border luxuries online in the past 12 months.
Online luxury cross-border buyers are concentrated in tier-1 and tier-2 cities. 52% consumers in the first-tier cities buy cross-border luxuries online while only 23% luxury buyers buy cross-border products.
About half of domestic e-commerce orders will be paid through Alipay, far higher than credit card users. However, 53% cross-border luxury shoppers will use credit cards to pay for orders online. Alipay, credit card, and debit card are major online payment methods among China’s luxury buyers.
By 2020, the number of Chinese internet users is expected to reach 80% of the total population according to Kantar Retail. 70% of them will shop online and online luxury buyers will buy 50% goods online.
Also read: China Retail V.S. Online Shopping 2015