Currently, China is known as the world’s largest internet market and. The estimated time Chinese spend on internet each day is approximately 1 billion hours, which is more than double the daily time spent by customers in the United States (Clemes et al., 2013). The increasing internet penetration and smartphone ownership is the cause for this booming e-commerce in China. As Jack Ma, founder of Alibaba once said: “In other countries, e-commerce is a way to shop, in China it is a lifestyle.”(KPMG, 2014).
Due to the concern of the trustworthiness of Chinese sellers and the proliferation of fake products, one of the current e-commerce trend in China is “Hai Tao” (literally translated as “Ocean Search”). This is about buying products online from overseas sites where quality and authenticity are more credible. However, Chinese online shoppers are challenged when the overseas websites are typically not available in Mandarin language, offer a different payment option and the long shipping of the products (Thepaypers, 2016). This is when platforms such as TaoWorld come in Handy.
TaoWorld is a Chinese mobile app that provides a platform for Chinese shoppers to purchase overseas item. Their main categories are Luxury brands, cosmetics, food and baby products. At first glance, it seems like just another third party that provides overseas products. However, this platform makes the user experience special as the sellers are all Chinese residents who are living abroad. To be able to sell on the platform, TaoWorld requires their sellers to provide an overseas identification, a valid overseas address and real time pictures of the products. This way Taoworld can secure that all products sold on the platform are genuine (Aimeizhuyi, 2016).
As TaoWorld is still a quite new company, one of their current strategy is to obtain more users on the platform. As platforms are two-sided markets (Eisenmann et al., 2006), TaoWorld focus on the supply side and tries to attract more sellers by providing a rewarding system. Every time the seller reaches a certain amount of orders and products on the virtual shelf, they will receive a certain amount of money from the platform as a reward (Aimeizhuyi, 2016).
TaoWorld seems to be a very promising application for users to sell and buy overseas products. Especially as Taoworld is being supported by a big company, they can provide better user experiences due to their resources. However, the fact that they do not charge additional fees from the buyers and sellers makes their business model a little strange. This platform is probably a test platform to obtain data about customer behavior. As long as the users do not get any problems, it should be a really useful platform for Chinese shoppers.
Aimeizhuyi (2016). Aimeizhuyi official website Available at: http://www.aimeizhuyi.com/ [Accessed 11 Feb. 2016].
Clemes, M., Gan, C. and Zhang, J. (2014). An empirical analysis of online shopping adoption in Beijing, China. Journal of Retailing and Consumer Services, 21(3), pp.364-375.
Eisenmann, T.R., Parker, G., Alstyne, M.W.V. (2006). Strategies for two‐sided markets, Harvard Business Review.
KPMG (2014). E-commerce in China: Driving a new consumer culture Report.
Thepaypers, (2016). China: online shoppers follow the Chinese saying “Hai Tao” trend. Available at: http://www.thepaypers.com/ecommerce/china-online-shoppers-follow-the-chinese-saying-hai-tao-trend/757219-25 [Accessed 11 Feb. 2016].