China dominates social commerce market, with sales to soar

The total social commerce sales in China was worth US$242.41 billion in 2020, which accounted for 11.7% of online sales, which is expected to rise to US$363.26 billion in 2021

Though the US social commerce market is growing at a rapid pace, China is unlikely to lose its position of dominance in the near future, according to Italian financial analyst site Finaria.

Social commerce is described as a subset of eCommerce which involves social media and online media that supports social interaction – as users assist in online buying and selling of products and services.

The total social commerce sales in China was worth US$242.41 billion in 2020, which accounted for 11.7% of online sales, and it will rise to US$363.26 billion in 2021, with eCommerce accounting for a 13.1% share, according to the research data analysed and published by Finaria.

Finaria forecasts that the US will take the lead in retail sales in 2021, with $5.506 trillion compared to China’s $5.13 trillion, but China’s eCommerce sales will outperform the US by a $2 trillion margin.

The total number of social buyers in China was estimated to be 357.2 million in 2020, which is forecast to rise to 392.2 million in 2021, 420.0 million in 2022 and 446.8 million in 2023.

The commerce market’s performance is partly due to China’s smartphone-driven culture, as most social buyers use mobile devices to shop and most digital storefronts starting out on mobile layouts, according to Finaria.

WeChat’s Mini Programs is among the most popular platforms for social commerce, Finaria reveals.

The platform facilitated transactions worth 1.6 trillion yuan (US$250 billion) in 2020, which was double its 2019 transaction value.

WeChat hosts around 2.3 million Mini Programs, compared to Apple App Store’s 1.96 million and Google Play Store’s 2.87 million.

Finaria notes that based on a study by WeForum, China accounted for over 50% of global online retail sales in 2020 – with the share of online sales in the country’s retail sales going from 20% in 2016 to 44.8% in 2020 – while the UK had a 27.7% share while the US had 14.7%.

Lastly, according to eMarketer, 52.1% of China’s retail sales in 2021 will take place online.

It will be the first time that a country records more sales online than offline, followed by South with a 28.9% share while the UK will be third with 28.3%, and the US will have a 15% share.

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