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As China's ecommerce sector expands and matures, Chinese consumers are shifting away from consumer-to-consumer (C2C) websites (where consumers buy from smaller, independent merchants) toward ecommerce sites offered by traditional business-to-consumer (B2C) retailers.
At a macro level, the consumer move away from C2C platforms has been underway for several years. Although C2C websites historically dominated ecommerce spending in China, more sales in recent years have been shifting toward B2C retailers. In June 2015, iResearch estimated that C2C ecommerce sales decreased from nearly 75% of all ecommerce spending in 2011 to less than 50% of the total by 2015.
The shift is also apparent when examining sales by product category and where those sales occur online. A July 2016 study by Kantar Retail found that Chinese B2C retailers accounted for more than 50% of consumer spending in the majority of categories studied.
Yet another sign of the shift away from C2C is the growing popularity of Chinese online retail brands like Tmall and JD.com. A separate October 2016 study by Kantar and CTR Market Research, which investigated the ecommerce sites Chinese internet users planned to use during the popular November 11th "Singles' Day" shopping promotion, found that two of the three most popular shopping sites with consumers (Tmall and JD.com) were B2C retailers. C2C retailer Taobao was the sole C2C site among the top three.
A number of factors are contributing to the growing embrace of B2C ecommerce platforms. One is the popularity of B2C vendors among shoppers in Beijing and Shanghai, where many of the most popular online retailers also have physical stores that help boost consumers' brand awareness. Another is a growing concern among Chinese shoppers with product quality and safety, which is contributing to a shift away from independent merchants operating via C2C channels who are perceived as less reliable.
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