The online retail market in China reached 1.59 trillion yuan (US$244.6 billion) in the second quarter of 2017 (up 31.2% over Q2 2016), with B2C sales accounting for 860.5 billion yuan (US$132.4 billion), an increase of 32% over the second quarter of 2016.
The second quarter is the traditional peak of the online sales season in China, with JD.com’s 6.18 (June 18th, a major promotional activity for online sales) having caught on and developed into a summertime companion to 11.11 (the winter sales peak, comparable to the US’s Cyber Monday).
This year, retailers unveiled major promotional initiatives including advertising, discounts, and interactive and live activities. At the end of Q2, data showed that Tmall had captured 51.3% of the online B2C retail market, with JD.com as its primary competitor with 32.9%.
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Tmall was able to leverage big data to better meet consumer demand and envisage different demand scenarios, improve its shopping guides, and broaden its distribution channels. JD.com reached a total turnover of 119.9 billion yuan (US$184.5 billion) during its 6.18 promotion, breaking its prior record; it also introduced a series of offline promotional activities called “6.18 Offline”.
Vipshop harnessed a drive for quality among consumers as a new growth engine, with the slogan “Global selection, genuine articles”, while splitting off its finance business and restructuring its logistics business.
A new round of competition in online retail is in the offing, even as major players continue to experiment with foreign brand offerings, improving logistics, and expanding into cross-border e-commerce.