Traditional Retail vs E-commerce

May 24, 2016 2 mins read
Traditional Retail vs E-commerce

For the buyers today, whether to buy in crowded shopping malls or on dazzling shopping websites, that is the question!

In recent years, traditional retail seems to be in sharp contradiction with e-commerce. It should be admitted that the rapid development of e-commerce is notable, and public opinions and media are partial to e-commerce. It is always said that e-commerce is to replace traditional retail. However, years have passed and offline retail stores are still in a dominant position in the market, though it is greatly impacted by e-commerce.

In fact, by the end of 2014, offline retail stores were occupying 80% of the market share, and this did not change too much until 2015. The change is that we can see more integration. Big e-commerce enterprises are striving to expand offline business and the traditional retail brands are beginning to open their online flagship stores instead of more offline stores. Amazon has opened offline stores in America, and Alibaba has cooperated with Yintai and further promoted O2O development mode in China. In the amazing sales of 91.2 billion RMB on November 11, 2015, GAP, Nike and Huawei were the biggest winners. Even the Luxury Brands such as Burberry and Hugo Boss have begun to open online flagship stores.

Online or offline, that is not the problem. China’s retail market has developed from single variety in the 1990s to current segmentation of each category. Having undergone several great transformations, China’s retail market still plays a significant part in the world. With Chinese people’s consumption capacity growing and consumption concept changing as well as the introduction of O2O mode, China’s retail industry is sure to develop further.

Marlon Mai's picture
Managing Director, Greater China
mmai@morganmckinley.com