The rise of China’s cross-border e-commerce
— — starting with the withdrawal of the United States from the Universal Postal Union
White house announced that the withdrawal from the Universal Postal Union(UPU) before black Friday, the U.S. e-commerce carnival on October, which means the profit model of the small sellers on Amazon, E-bay, Wish and other platforms will change. The only way to continue is to turn to other cross-border markets. The cost of delivery for sellers that has warehouses in U.S. would increase too.
Who would get hurt in overseas online shopping? Why did Trump “drop out”?
The United States’ withdrawal from the UPU has limited impact and controllable risks (for China), said Gao Feng, a spokesman for China’s ministry of commerce. The Trump administration’s move will mostly affect small sellers, while the affect to large sellers which has storages in America is weaker.
On the other hand, the withdrawal from UPU is different from imposing tariffs on China. Although both of them are borne by the entire supply chain, the influence of the withdrawal will be exerted on the consumers directly. That will hurt consumers in America in the end. So why does Trump still “drop out”?
The main reason is that the United States is dissatisfied with the discount about postage discounts for developing countries. It shows that the government wants to exit the international organizations which cannot be helpful to American profit any longer. White house believes the influx of cheap Chinese goods has a huge impact on American business and the sales of local brands.
As a developing country, China enjoys low terminal fees. But China is also a major e-commerce country, occupying a huge share of the world market. Data shows that about 60% of the packages delivering to the United States come from China. Obviously, America’s tax increase for Chinese goods and withdrawal from the UPU are side reflection of the rise of Chinese e-commerce.
How is Chinese cross-border e-commerce doing in America?
The brand premium and strong channel of App are the advantages of cross-border e-commerce all the time. Apps have become an important tool for cross-border e-commerce. The performance of Chinese cross-border e-commerce in American market can be seen from the data of Apps.
According to the statistics of App store in America, more than half of the Apps in the free list are from the United States and cover nearly 20 categories such as shopping, finance, social networking and communication. Among the top50 Apps about e-commerce, China accounts for 8%, which is the largest country except the United States.
Top20 downloads of Apps in US e-commerce
According to AppBi, the top e-commerce Apps in the United States are Amazon, Wish, Walmart, eBay etc, which also do well in overseas e-commerce. In addition, China’s ROMWE, ZAFUL, AliExpress and DHgate have a good performance in the United States. Among them, ROMWE ranks the 17th in shopping App category. Compared with Alibaba and DHgate, ROMWE, an european-style women’s wear brand, is more favored by American mobile e-commerce users. It can be seen that, although the American native e-commerce Apps are occupying the market firmly, Chinese cross-border e-commerce Apps are also trying hard and making difference.
Amazon is the first choice of American for online shopping. According to related data, Amazon occupies more than half of the e-commerce flows in America. However, Amazon’s success highly relies on the United States Postal to complete the “last mile” delivery. Alibaba, the top e-commerce in China is also changing.
At present, Alibaba is expanding its logistics network globally and integrating its subsidiaries to connect the global e-commerce market. In terms of the trends of development, Chinese e-commerce enterprises represented by Alibaba have huge development space. AliExpress ranks second on the list of bidding words in the shopping category of Apple App Store.
In the case of a similar overall ranking, Wish gained more display than Walmart (with 0 of the number of bidding keywords) significantly by putting in more search ads bidding words (8,293). In the platinum vocabulary such as shopping, the display of Wish reached 2.17 times of Walmart (the display of Wish is 1.93% and Walmart is 0.89%).
Such as shopping, the key words with high popularity and low competition are often “platinum vocabulary” that Apple search ads are looking for. The degree of competition can’t be queried in Apple’s search ads system, but in the third party platform. For example, on AppBi platform, the function of “keyword ads search” provides the history date of competitive degree. It can view the bidding history of every keyword, helping users to observe the competition of Apple keywords.
Looking at some keywords of e-commerce, through the tool of keywords heat detection, we can clearly see that it is the golden active time of e-commerce Apps from October to February of the next year, with the heat increasing by 10%. The heat of key word “shopping” rose 46% to match the popularity of e-commerce such as double 11, double 12 and the Black Friday. It can be seen that the e-commerce Apps which are cross-border can grasp this golden time to make further progress.
What we need to pay attention to is that Apple’s disposition of complaints about brand word has become more and more serious. Someone encountered this kind of situation, the complaints are disposed successfully even if the word isn’t added in the title or not occupy Top1 in keyword search results. If the another company have the trademark rights, or Apple Approved that the brand word is belong to them you will be complained successfully. So we suggest that related company should respond to complaint emails positively, or inquiry in AppBi platform for the intelligent bidding query.
Strategies: the trend of China’s cross-border e-commerce under the background of rising logistics costs
Whether the increase in delivery service fee of U.S. Postal or the United States withdraws from the Universal Postal Union, it will increase the logistics cost of cross-border e-commerce sellers. What the platform can do is to reduce expenditure and increase revenue as much as possible and optimize the operation mode. After this, China’s cross-border e-commerce team should also learn to cooperate effectively with local distribution and retail agents, link online and offline, operate online efficiently, push offline synchronously, and participate in various activities. In addition, it needs to have a comprehensive and in-depth understanding of local smartphone penetration, network coverage and mobile user behavior. Leading edge in App development, search optimization and user growth.
We believe that every step of the journey from domestic e-commerce to cross-border e-commerce, to Europe and America markets, southeast Asia and Africa markets, will be a valuable experience in the future.
