Established in 2001 as a subsidiary in China, Amazon China once went through a nosediving period. By building and promoting cross-border shopping strategy, Amazon China has begun to make some initial success in 2015.

Amazon China’s total transactions during Black Friday increased by more than six times this year compared to 2014, and spends at Amazon overseas sites have been equivalent to the sum of the past 20 years counting only from January to October 2015 according to Amazon.

Mr. Douglas Gurr, who has been President of China Amazon.com Inc. since September 1, 2014, has been focusing on the business as a cross-border site as well as helping China’s brands gain global exposure summarized three reasons contributing to the fructified sales in 2015.

Small Ideas Hatching Big Business

Amazon had a well-established “reverse” mechanism or process at being innovative and creative. Faced with a new idea, they first answered two basic questions: What do consumers really need? Could Amazon develop a unique advantage from this business? Amazon picked out the most important ideas from thousands of new ideas and gradually improved.

This way of thinking helped select out some good ideas. AGS project of Amazon was born following the path. Based on worldwide suppliers and advanced cross-border logistics and distribution system, Amazon China provided consumers high-quality product selections and lower prices without suffering long delivery time, high shipping costs and fake goods.

Exploring China’s Innovative Products

Launchpad was a project providing a platform for excellent products and startups in China. The project could effectively help startups reach tens of millions of Amazon consumers worldwide and benefit consumers and innovators at last. Launchpad was operated during Black Friday shopping festival in 2014.

Own-branded Products Satisfying Chinese Demands

Fire tablet, which was recently released in China installing English-learning function to provide customized reading experience for different English levels of users, was a good trial at Amazon China. New Fire tablets with English-learning function was only marketed to China’s consumers.

The localization of innovations was solutions to the urgent needs of China’s consumers. Amazon has been striving to support suitable products for China’s market by deep insights into China’s consumers.

Also read: China Retail V.S. Online Shopping 2015

China’s cross-border shoppers reached 18 million and generated revenues of 140 billion yuan (US$21.75 billion) in 2014 according to China Electronic Commerce Research Center and China General Administration of Customs.

Transaction values of the cross-border market in China are expected to exceed 1 trillion yuan (US$0.16 trillion) in 2018 according to China Electronic Commerce Research Center with 36 million cross-border shoppers in 2018 according to Nielsen. It will account for 16% e-commerce market.

Amazon, as the largest global e-commerce company, is undoubtedly benefiting from the expansion and growing popularity of onine cross-border shopping market. The total expenditure of China’s consumers at Amazon Global sites increased by more than six times this year compared to 2014, and spends at Amazon overseas sites have been equivalent to the sum of the past 20 years counting only from January to October 2015.

80% cross-border consumers on Amazon were under the age of 35 according to Amazon. Over 90% users have Bachelor’s Degree or above. In addition, over half cross-border shoppers gained a monthly income of more than 5,000 yuan.

Cross-border shoppers in tier-3 and tier-4 cities grew faster than tier-1 and tier-2 cities during Black Friday becoming the fastest growing regions. However, the average consumption per shopper on Black Friday was less than 699 yuan (US$108.59) in 2015 according to Alipay.

Although on Double 11 Tmall sold out 2,605 cross-border products from 41 countries only in the first 10 minutes and surpassed last year’s cross-border transactions within 105 seconds, cross-border orders on Amazon were much fewer.

However, Amazon China launched its Black Friday promotion from November 18th lasting till December 5 2015, which was longer period than other e-commerce websites in China. Sales values on Black Friday were 10 times as much as its Double 11 ones this year.

The number of online cross-border shoppers on Black Friday 2015 increased by 7 times compared to last year according to Alipay. Sales in only half a day on Black Friday surpassed total one week’s sales during Black Friday in 2014. And page views on Amazon reached a record high on Black Friday with the number of new users as much as four times more than 2014.

Bags, shoes, and personal-care products have been the most popular categories of China’s cross-border shoppers on Amazon since 2014 while shoppers liked beauty makeups best on Taobao.

Beijing cross-border shoppers preferred air purifiers, vacuum cleaners, water purifiers and masks. Shanghai shoppers liked to buy infant formula. Hangzhou buyers liked Cartier products and Nanjing consumers preferred cross-border beauty products.

Price (84%) and quality (81%) were top two factors for China’s cross-border consumers, followed by logistics (57%). Very long delivery time would damage the enthusiasm of cross-border shoppers. Male users are most concerned about commodity prices while the female users during Black Friday are most concerned about whether the goods are authentic.

In recent years, the gradual improvement of cross-border e-commerce policies on customs, bonded warehouse, or a host of other policies has encouraged the cross-border business in China. Besides, online shopping platforms and cross-border shopping platforms have developed to a certain scale.

Also read: China Retail V.S. Online Shopping 2015

The overall turnover of Black Friday in 2015 increased by nearly 30 times more than that in 2014 and the number of orders increased by nearly 35 times this Black Friday shopping season according to Alipay. 

About 75% of China’s cross-border online buyers are women and 25% are men buyers during the Black Friday shopping season. Women aged from 25 to 40 years old accounted for the most orders. Apparel, beauty products, mother care and health care products are four categories of the most sought-after commodities which made up more than 75% of the total transactions in total. Free delivery is still a key factor to encourage more buyers.

The post-90s account for 34% of China’s cross-border online shoppers during this year’s Black Friday shopping promotion in China, representing an increase as large as 3 times. Cross-border online shopping costs decrease about 20% during the Black Friday shopping season in 2015 and the average cost is expected to decline more pursuant to the perfecting cross-border logistics and payment.

China’s cross-border online shoppers increased by seven times during this Black Friday compared to the shopping season last year according to Alipay. The average spend per person is 699 yuan (US$109.07) and the post-90s account for three-tenths of cross-border online consumers. China’s cross-border online shopping market has been developing rapidly especially in small and less developed cities.

China’s cross-border online shopping market is still concentrated in some developed cities and provinces such as Beijing and Shanghai: Beijing makes up 16.4% transactions values during the Black Friday and Shanghai 21.9%. Cross-border shoppers in Henan, Shanxi, Hebei, Hunan and Jiangxi have been growing in a large rise that cross-border online shopping may penetrate from large and developed to small and less developed cities soon.

The top 10 cities who make the largest orders in China during the Black Friday shopping season this year are Shanghai (21.05%), Beijing (12.99%), Hangzhou (4.89%), Guangzhou (4.51%), Shenzhen (3.90%), Chengdu (3.62%), Nanjing (3.54%), Wuhan (3.46%), Tianjin (2.57%) and Chongqing (2.28%).

The top 10 provinces and municipalities with the largest orders in China during the Black Friday shopping season this year are Shanghai (21.05%), Beijing (12.99%), Guangdong (11.41%), Zhejiang (9.51%), Jiangsu (9.28%), Sichuan (4.42%), Hubei (4.24%), Liaoning (2.82%), Fujian (2.71%) and Shandong (2.57%).

Also read: China Retail V.S. Online Shopping 2015