Covid-19 has fuelled digital boom in Greater China, says KPMG
Chinese buyers on the mainland and in Hong Kong have steadily migrated towards e-commerce in the midst of the continuing coronavirus pandemic, communicating with businesses via social media or digital channels and remaining focused on “value for money”.
The insights are revealed in a KPMG global survey studying developments in customer behaviour across 12 regional markets, in which convenience factors rated highly as a behavioural motivator.
A significant increase in usage of large grocery retailers’ online services were noted in both Hong Kong and Mainland China, with a distinct increase in non-grocery online shopping services also noted in Hong Kong. New e-commerce formats are on the rise in China, such as influencer livestreams, self-built e-commerce and community commerce via social media.
“As consumers in China continue to adapt to the pandemic and its aftereffects, it is clear that changes to their purchasing behaviours are here to stay,” said KPMG China partner and head of consumer & retail Jessie Qian. “Physical retail will need to offer consumers new reasons to purchase offline. With price and convenience being key to consumers’ decision making, retailers will need to develop their online and last mile logistics and delivery capability and manage the balance between home delivery and in-store product ranges.”
The survey also highlighted the importance of transparency with clear communication in Chinese e-commerce, as well as rapid response within the Hong Kong online shopping space.
“Across China and around the world, a new consumer is emerging – one that is financially impacted, more advanced in their use of digital technologies, and more thoughtful and selective in their decision-making,” said KPMG China partner and head of consumer and retail Aspac Anson Bailey. “Organisations have responded to Covid-19 with high levels of innovation, including greater digital access to purchasing and customer support, and they must continue to focus on the digital enablement of their customer.”
The survey also noted a general deferment in non-essential purchases and within China, a higher demand for groceries, FMCG and other food and beverages.
“The consumer’s search for value for money is a fundamental change in purchase priorities and will be prevalent for 12 months or more,” said KPMG China partner and head of consumer and industrial markets Hong Kong Alice Yip. “Organisations can no longer protect their price positioning with experiential factors that now have less direct benefit to the consumer. They will need to rethink their business and operating models and be clear on where they need to win the customer’s trust.”