Published on: July 17, 2023
Tech savvy Chinese consumers’ expectations go beyond a seamless mobile experience for browsing and purchasing products and services — they also expect lightning-fast delivery.
Today’s consumers in China expect their parcel delivery to be on-demand and free, and they do not expect to pay extra for these features.
Western companies aiming to sell in China not only must understand the importance of highly attentive customer service and detailed product descriptions, they also need to address the demand for lightning-fast shipping.
Back in 2016, there was an interesting incident that took place on November 11th (also known as Singles Day, the biggest e-commerce shopping event globally). A customer in China placed an order shortly after midnight, and surprisingly, the delivery was made just 13 minutes later.
Although Chinese consumers don’t typically anticipate such swift deliveries within 15 minutes, this particular 13-minute timeline foreshadowed future trends in the industry.
SF Express, the second-largest courier in China has its sights set on 6–12 hour delivery times by 2030. In an interview with Mckinsey, SF Express Eddie Huang predicted that 12-hour delivery would become the standard shipping timeline across mainland China. In other words, major metropolitan areas will likely see 6–12 hour deliveries before the end of the decade.
Western companies aiming to expand or strengthen their presence in China must meet or surpass the rising expectations of Chinese consumers when it comes to shipping.
Covering the vast expanse of China’s 9.6 million square kilometers is undeniably challenging. While there are already fast and reliable connections available for entering and exiting China’s tier-1 and 2 cities, companies must also have the capability to reach the rapidly expanding and increasingly eager consumers in tier-3 and 4 cities.
Moreover, with the continuous growth of e-commerce throughout the country, consumers residing in lower-tier cities and rural areas of China will soon demand logistics and delivery services on par with those enjoyed by their counterparts in larger urban areas.
Shipping delays are often experienced at the borders of the country, causing significant delays. International shipping is already complex, but China’s regulations make inbound shipping from foreign countries even more complicated. To avoid unnecessary delays, companies should consider establishing a physical presence within China.
One option to achieve this is by setting up shop on Tmall’s domestic “Flagship” service instead of using the “Tmall Global” platform, which focuses on cross-border transactions. While Tmall Global may seem like an easier way for Western brands to do business in China, its cross-border nature can cause shipping delays that Chinese consumers find displeasing.
Furthermore, Tmall Global has a higher commission fee structure compared to the domestic Tmall service, which can quickly outweigh the initial benefits provided by the global platform.
If a brand needs use Tmall Global or JD Worldwide due to compliance issues, engaging in cross-border e-commerce in China can potentially harm how consumers perceive the brand. This is because it may lead to shipping delays. These risks, however, can be reduced by partnering with experts who can help establish a local presence in the market through proxy.
A reliable China logistics partner can assist brands in overcoming the regulatory barriers of conducting business in mainland China. They can also provide the expected level of service by acting as merchants of record.
The solutions offered by a trustworthy and dependable China operations partner include:
Competition in China’s e-commerce market — worth nearly US$3 trillion — is intense, with both big and small players vying for position. Whether brands are already selling in China or planning to do so in the future, it is crucial for them to deepen their understanding of consumer expectations and be adaptable to market changes.
Currently, Chinese consumers have set a high standard for their online experience. This includes having a user-friendly mobile-optimized website, advanced customer support, and, most importantly, fast and reliable shipping services.
Brands aiming to meet these expectations should avoid relying heavily on cross-border e-commerce shipping. Instead, partnering with the right domestic service provider is a crucial step towards achieving this goal.
Let's take the first step.