China's Ecommerce Growth In 2016 Q1

China’s ecommerce market is already the largest in the world, yet it continues to grow. Despite Alibaba and facing challenges expanding delivery networks to reach over 1 billion people living in rural areas, both have posted better than average growth numbers in Q1.

Alibaba Group, the largest ecommerce marketplaces operator in China which owns, and reported 24% year-over-year growth of gross merchandise volume (GMV) at $115 billion.

Alibaba is continuing to expand outside of China, just recently they acquired Southeast Asia e-commerce platform Lazada.

China’s No.1 retailer reported its sales grew by 55% to $20.1 billion. Phenomenal growth, yet it has slowed down from 99% growth in 2015 Q1. Still 55% is twice the rate of overall ecommerce growth in China.

Alibaba has roughly 50% of the China’s ecommerce market. is growing and now has close to 25% market share. Amazon China so far is a much smaller player compared to both.

Alibaba and business models are fundamentally different. Alibaba operates much like eBay, by building ecommerce marketplaces where any consumer or business can sell their products. Thus their revenue comes from various fees, sales commission and other services. While at its core functions like Amazon - they do allow other sellers on the platform, but most of the sales are done by themselves. They even have their own fulfillment network to ensure last-mile delivery speeds.

Amazon’s sales grew by 28% to $29.1 billion, a very strong quarter but is not far from overtaking them.

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Juozas Kaziuk─Śnas

Founder of Marketplace Pulse, Juozas wears multiple hats in the management of Marketplace Pulse, including writing most of the articles. Based in New York City. Advisor to other startups and entrepreneurs. Occasional speaker at conferences.

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