With nearly 22 years of development, e-commerce in China has entered its time of sustainable development. Looking only at the business-to-consumer (B2C) sites, Tmall, 360buy, Amazon and YiHaoDian stand out for this review. By the end of 2011, Tmall.com and 360buy.com are the top two e-commerce sites in China, taking 39.9% and 14.7% of the market share respectively. Amazon.com and YiHaoDian.com rank the 4th and the 10th respectively in the industry. What are the similarities and differences among the four and what factors contribute to their success?
The Competitive Advantage of 360buy
360buy, as the biggest 3C (computer, communication, consumer electronics) online shopping platform in the B2C sector of ecommerce in China, gains its competitive edge through three strategies: price, channel, and sales promotion. The CEO Liu Dongqiang believes the high inventory turnover and cash turnover rate and good cost management contribute as key to his company’s success as an online retail business. Statistics show that 360buy has an inventory turnover rate of 12 days and pay off its inventory at spot while its major competitor Suning and Gome have an average of 47 to 60 days of inventory turnover and 112 days of payment term.
A Comparison of Tmall, 360buy, Amazon and YiHaoDian
Tmall was set up by Taobao.com in 2011 as a B2C site only open to big sellers, flagship stores and exclusive stores. 360buy mainly sells 3C products as mentioned above, but also sells other products and services clothes, cosmetics and books. Amazon is especially target fashion and cultural products—books, audio-visual products, and gifts, while YiHaoDian is the first online supermarket in China. These B2C sites differ in various respects, such as credit evaluation system, shopping guide tools and specific marketing strategies. For example, Tmall set evaluation criteria such as degree of conformation with product description and speed of delivery while 360buy asks customers to comment on the pros and cons of their products and to share their using experience. As for the design of the websites, Amazon values function greatly while the others also give consideration to artistic look. It’s worth noticing that, YiHaoDian, unlike the other three, stands out as the first online supermarket, whose mission is to create the greatest value for its customers through the usage of advanced platform and innovative business model.
New Trends For China’s B2C Websites
As news reported, on May 13th, 2011, Walmart invested in YiHaoDian, giving it even better prospect for future growth and development. “We are excited about this investment.” Says Yu Gang, the co-founder of YiHaoDian,”Walmart will bring us its global perspective and its outstanding supply chain management will surely help us gain more competitive advantage in the e-commerce industry in China. ” What’s more, for Tmall, it officially changed its Chinese name to Tianmao (天猫), with a logo of a cat representing fashion, trend and quality. With this change, Tmall aims to further clarify its market position and style.