China remains the largest e-commerce market globally, with an impressive sales volume and approximately 1 billion local consumers utilizing e-commerce channels in 2022. These consumers accounted for 45.3% of all online retail sales, offering valuable insights into trends expected in 2025.
Over the past few years, the annual online retail sales of physical goods in China (measured in yuan) have nearly doubled. Driven by shifting consumer preferences and ongoing retail innovations, the e-commerce sector continued its rapid expansion throughout 2022. As the market evolves, adapting to these changes will be critical for businesses aiming to stay competitive in this dynamic landscape.
China’s Vast Market Scale
2022年中国电商gmv汇总
| 阿里 | 京东 | 拼多多 |
| 8万亿 | 3万亿 | 3万亿 |
| 美团 | 抖音电商 | 抖音本地生活 |
| 2300亿 | 1.4万亿 | 600亿 |
| 快手电商 | 视频号电商 | 小程序私域电商 |
| 7000亿 | 500亿 | 3万亿 |
The Rise of the Sports Trend
Between January 31 and February 4, 2022, sales of winter sports equipment on the Tmall platform surged by 300%, with skiing gear alone seeing a remarkable 180% increase. By March 2022, sales of outdoor and camping equipment on Tmall had doubled compared to the same period the previous year, reflecting a booming interest in outdoor activities.
Social sports are also on the rise. In 2008, China had only 100 frisbee players, but by 2021, that number had grown to nearly 500,000, highlighting the growing appeal of group activities. During the 2022 618 Shopping Festival, over ten international brands, including American skateboard companies Carver and Santa Cruz, announced their entry into the Chinese market via Tmall International, leveraging Alibaba’s cross-border e-commerce platform.
Changing Status of Pets in China
China’s pet economy is thriving as consumers increasingly treat pets like children, in some cases even better than. This shift is driving demand for premium pet products, including high-quality food, clothing, and innovative tech devices.
During the first sales period of the 2022 Double 11 Global Shopping Festival, Tmall’s pet food GMV recorded triple-digit growth. Smart technologies such as feeding bowls that track eating habits and companion robots for pets are gaining popularity. Brands like Instinct, which has doubled its business in China over the past three years, and Royal Canin, which offers personalized online consultations with animal experts, exemplify how companies are meeting the needs of China’s pet-loving consumers.
In upcoming years, we anticipate that more brands will expand their offerings to cater to the evolving needs of pet owners such as Royal Canin who is already monopolizing on this new trend development.
The Metaverse is Expanding
The metaverse is transforming how Chinese consumers engage with brands. Platforms like Alibaba’s ecosystem provide gamified experiences, virtual try-ons, and opportunities to purchase digital collectibles.
By the end of 2022, nearly 20 luxury brands had launched 37 digital collections on Tmall Luxury, attracting thousands of buyers. For instance, Burberry hosted a private digital salon on Tmall Luxury to sell coats.
Gartner predicts that by 2026, one-quarter of consumers will spend at least an hour daily in the metaverse for activities such as shopping, socializing, or entertainment, underscoring the importance of digital innovation.
Generation Z: The Must-Win Consumers
Generation Z, which makes up about 15% of the Chinese population as of 2021, is a powerful force shaping consumer trends. Born between 1996 and 2010, this group is driving significant shifts in the market.
As one of the fastest-growing consumer segments on Chinese e-commerce platforms, Generation Z is expected to account for nearly two-thirds of Tmall International’s consumers in 2022, and over 17% of all luxury goods purchases on Tmall.
Their purchasing power continues to grow: In 2022, consumers born after 1995 surpassed those born after 1985 in total luxury gift spending on Tmall. Gen Z is also more inclined to invest in experiences and enjoys standing out, helping to turn previously niche trends—like skateboarding and alcohol-free beverages—into mainstream phenomena.
Virtual Idols are on the Rise
In 2022, virtual idols emerged as digital spokespersons for numerous brands. According to market research firm Forrester, this trend will continue to grow, with predictions that by 2023, one-fifth of B2C brands in China will incorporate digital idols to enhance the consumer shopping experience.
These digital figures have increasingly taken over customer service roles on e-commerce platforms. For example, during the Beijing Winter Olympics in February, Alibaba introduced “Dong Dong,” a digital idol who helped consumers navigate the event. Additionally, technological advancements have enabled virtual idols to interact live with consumers. In one instance, Alibaba’s virtual idol “Noah” participated in Tommy Hilfiger’s brand livestream, causing the brand’s daily GMV to quadruple compared to regular sales.
Live Commerce Shifting to High-Priced Products
As the live commerce industry continues to evolve, a shift is occurring towards higher-priced products. In the first half of 2022, a TikTok e-commerce analysis revealed that nearly 70% of products sold were priced under 50 yuan, covering categories like food, cosmetics, baby products, and clothing. This indicates that almost 90% of total sales were from items under 100 yuan. However, live commerce is now poised to expand into selling more expensive goods.
Simultaneously, in 2025, we can expect more shops to focus on offering lifestyle services in short video live rooms. These services, such as food, drinks, and entertainment, are an extension of e-commerce for physical stores. Business owners should start planning for this shift in consumer engagement and strategy.
