May 23, 2024
China Fashion Ecommerce Market

China Fashion Ecommerce Market is Estimated to Witness High Growth Owing to AR and VR Adoption

The China fashion ecommerce market has witnessed significant growth over the past few years. Fashion ecommerce refers to the purchase and sale of clothing, footwear, accessories, and beauty products through online platforms. The increasing penetration of smartphones and high-speed internet connectivity has enabled consumers to comfortably shop for fashion items from the convenience of their homes. Ecommerce platforms offer a wide variety of domestic and international brands at competitive prices along with features such as virtual try-on, reviews, ratings, and attractive deals which enhance the online shopping experience for consumers. The adoption of technologies such as AR and VR is further elevating the China fashion ecommerce market. AR and VR enable realistic virtual try-ons of apparels, footwear, accessories, etc. without actually having to purchase the products. This allows consumers to evaluate fit, size, design, and style of items from different brands and angles before making the purchase decision.

The Global China Fashion Ecommerce Market is estimated to be valued at US$ 744.01 Bn in 2024 and is expected to exhibit a CAGR of 13% over the forecast period 2024 to 2031.

Key Takeaways

Key players operating in the China Fashion Ecommerce Market Size are MaritzCX Research LLC (Inmoment LLC), Adobe Inc., Medallia Inc., Oracle Corporation, Clarabridge, SAP SE, Sitecore, IBM Corporation, Zendesk, Avaya Inc., Open Text Corporation, Verint Systems Inc., and Tech Mahindra. The rising disposable incomes and increasing spending power of China’s emerging middle class represents a major opportunity for growth in the fashion ecommerce market. Technological innovations such as AI, virtual and augmented reality are enabling advanced online shopping experiences and personalizing the consumer journey in the China fashion ecommerce industry.

Market drivers

The rapid growth of China’s ecommerce industry is one of the key drivers propelling the fashion ecommerce market in the country. China has emerged as the world’s largest ecommerce market backed by a huge online shopper base and sales of over $1 trillion annually. Moreover, increasing internet and smartphone penetration coupled with widespread adoption of m-commerce is augmenting online fashion sales in China. According to estimates, mobile commerce accounted for over 80% of total ecommerce sales in China in 2020. The shift towards digital payments also encourages more consumers to transition to online platforms for shopping.

Current challenges in China Fashion Ecommerce Market

With increasing competition in the China fashion ecommerce market, businesses are facing challenges in innovating product offerings, building strong relationships with customers and remaining cost-effective. While demand continues to grow rapidly due to rising incomes and smartphone penetration, logistical challenges remain in areas outside top tier cities. Companies struggle with high return rates and difficulty in predicting changing consumer preferences far in advance. Adapting to the growing importance of social commerce and livestream shopping is another key challenge.

SWOT Analysis
Strength: Large domestic customer base with growing spending power. Established logistics and fulfillment infrastructure in major cities.
Weakness: High dependency on few digital payment methods and online channels. Challenging unit economics with high customer acquisition and retention costs.
Opportunity: Expanding into lower tier cities and rural regions. Emerging opportunities in areas like personalized styling, resale and rental models.
Threats: Tightening regulations around data privacy and customer experience. Increased competition from global and niche online retailers.

Geographical regions of concentration
The Yangtze River Delta region, encompassing Shanghai, Jiangsu and Zhejiang provinces, accounts for the largest share of the China fashion ecommerce market value currently. This is due to the high population density and disposable incomes in cities like Shanghai, Hangzhou and Nanjing resulting in heavy online shopping activities.

Fastest growing region
The Central and Western regions of China have been witnessing much faster growth rates compared to Eastern regions like the Yangtze River Delta or Pearl River Delta. As ecommerce and logistics penetration increases in lower tier cities and the wider availability of fast fashion brands stimulates demand, regions such as Sichuan, Chongqing, Shaanxi and Gansu are emerging as key high growth markets for the industry.

1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it