Windy Shao

windysjf@hotmail.com

THE import and export trade volume of China’s cross-border e-commerce sector surged 15.6% year on year to 2.38 trillion yuan (US$328 billion) in 2023, according to Wang Xin, executive president of the Shenzhen Cross-border E-commerce Association.

Wang revealed the figure at the Global Traffic Conference (GTC Shenzhen) that concluded at the Shenzhen Convention and Exhibition Center in Futian District on Tuesday.

Wang shared a promising outlook for the industry despite a slight downturn in global trade. She forecast a 20% compound annual growth rate for China’s cross-border e-commerce business-to-consumer (B2C) market from 2016 to 2025.

With the surge in online cross-border shopping, retail e-commerce sales reached US$6.3 trillion in 2023 globally, which is estimated at US$8.1 trillion by 2026, Wang said.

China, supportive of cross-border e-commerce, have established 165 comprehensive cross-border e-commerce pilot zones nationwide, Wang told the conference.

The two-day GTC attracted over 200 exhibitors and an attendance of over 23,000. With an array of discussions and summits, the conference offered industry insiders insights and networking opportunities.

Short dramas

Short dramas, a sector experiencing a meteoric rise in China, have reached out to a global audience.

Nan Yapeng, vice president of Crazy Maple Studio (CMS), referenced data from Appfigures revealing that overseas users spent over US$65 million on short drama apps in March this year, a tenfold surge year on year. While North America continues to be a pivotal revenue source for the global expansion of short dramas, noticeable growth has emerged in Southeast Asia, Japan, and South Korea over the past year, Nan said at a seminar focusing on short dramas.

Nan mentioned that contents from his company’s online literature platform have been successfully adapted into short dramas.

In 2024, gaming studio CMS made Time magazine’s list of “100 Most Influential Companies.”

Monetization strategies

Research underscores a positive link between a brand’s visibility on YouTube and search engines, with 49% of consumers acknowledging the sway of key opinion leaders (KOLs) on their purchase decisions, as disclosed by Zhang Yuqing from YouTube’s Greater China Project Team in a keynote speech at the conference.

Zhang advocated for Chinese brands seeking international expansion to harness the diverse spectrum of KOL resources on YouTube to influence consumer behavior positively.

When it comes to cultivating a growing base of channel followers for monetization, Zhang advised brands to tailor their content in alignment with prevailing trends, leverage recommended algorithms, and delve into user psychology to create tailored content.

Brand building is set to dominate in the next decade, Zhang said, asserting that engaging with the audience, forging emotional connections, and honing brand positioning represent the three pivotal marketing dimensions.

Sustained growth

During the opening ceremony, Steven Huang, investment director at Fosun RZ Capital, marked 2022 as a pivotal juncture in economic and industrial cycles.

Before this turning point, the narrative of China’s cross-border e-commerce was closely intertwined with the robust expansions of GDP and individual purchasing power. The eruption of overseas internet usage and e-commerce trends during the pandemic further fueled the sector’s growth.

After 2022, the global economy entered a downward cycle characterized by high inflation, monetary tightening, and a scarcity of liquidity in capital markets. Only companies that help customers save money or make money will do well, he said.

For Chinese companies eyeing overseas expansion, Huang gave advice based on different stages of their growth.

For new businesses looking into other countries, it is advisable to conduct thorough research on overseas markets, competitive analyses, and user insights.

For businesses in the stage of initial growth, it is crucial to emphasize growth efficiency and quality, such as customer acquisition costs and return on investment (ROI). For businesses experiencing rapid expansion, upholding regulatory adherence to avoid possible risks in overseas markets must be a priority.