China’s online commerce market will likely surpass that of the United States in the next six years, according to Investorplace.com.
A study by Forrester Research indicated that the total value of the US online commerce market is expected to grow to $370 billion by 2017. However, China’s figure could reach a whooping $420 billion to $650 billion by 2020, revealed global consulting firm McKinsey & Co.
Although the two studies cover different periods of time, the findings are still relevant as their difference is merely three years, said Investorplace.com.
In addition, Amazon and eBay’s combined sales and market value don’t reach the levels of Chinese e-commerce giant Alibaba, despite the fact that they are the two biggest internet commerce sites in the US.
In fact, the excitement being created by Alibaba’s $20 billion IPO next month “has reached a level of hype not seen since the dot-come era of the late 1990s,” said investment expert James Brumley.
Aside from Alibaba, other China-based e-commerce portals are also flourishing. For example, JD.com’s revenue surged by 64 per cent in Q2 2014 on an annual basis. Touted as China’s Amazon, the company’s customer base reached 38 million during that quarter. Likewise, Dangdang’s earnings soared by 31 per cent while Cheetah Mobile posted a stunning growth of 139 per cent, with active users hitting 284 million.
Furthermore, China’s e-commerce market is expected to grow by leaps and bounds given its population of 1.35 billion. However, only half of the population uses the internet, while internet usage among adult Americans stands at 87 per cent.