What to consider before starting ecommerce in AsiaSeptember 7, 2020
The list of ecommerce platforms in Asia is huge – it’s no wonder that businesses wanting to get involved in the market don’t always know where to start. You can’t assume that what works in a Western context will translate directly to an Asian platform. Just recently, Alibaba’s Chris Tung told Western companies not to make the mistake of comparing it to Amazon . Setting up an ecommerce website is probably the single most important thing to consider if you’re building a strategy for doing business in Asia. But what tools should you use? Can hosted ecommerce platforms such as Shopify support Alipay or WeChat pay? Should you go with Tmall instead of building a standalone ecommerce website? When it comes to ecommerce in Asia, it’s always complicated.
Tmall is not enough
There is a huge population in Asia which shops on Tmall – it cornered more than 56% of the market last year. You may ask why you need an ecommerce website when the Alibaba Group platform is easy to set up and is already dominating the market. This used to be a valid argument, but the parameters are changing now. For one thing, it’s hard to get noticed on Tmall without additional advertising budget – similar to getting top rank on Google, you would either need to invest in good SEO or buy ads to get more exposure.
In recent years, WeChat has emerged as Asia’s fastest-growing app, with 938 million users in Q1 2017. Owned by Tencent, Alibaba’s biggest rival, it has evolved at an incredible speed to the point that it is now a mini-operation system on mobile. Many people are buying things through WeChat direct rather than opening another app or website – and Tmall is excluded from this thanks to the rivalry between Tencent and Alibaba.
Because of this, some businesses are now looking at ecommerce solutions outside Tmall that work in WeChat. The easiest solution is to link a branded WeChat account to a responsive ecommerce website. But there are a lot of solutions out there which might be a better fit – it’s worth getting advice on how to choose the best ecommerce platform for your business.
What else should you look out for?
Apart from choosing an ecommerce platform, you will also need to consider the server and the payment gateway.
The server is very important for an ecommerce website. It should be stable while able to serve many people at the same time. For China, you will need to have an ICP license as well. This allows you to host websites in China, but you will need a China business license to apply for it. In the past you could host a website outside China, allowing Chinese users to access your site at a slower speed. However, as the government is tightening its policy, in future it is very likely that you will need to host the website on a China-based server.
Payment gateway is another key consideration. Credit cards are not popular in China – Alipay and WeChat pay are more sensible options. Most of the international payment gateways such as Paypal and Braintree do not support these payment methods, apart from Stripe which supports Alipay. Fortunately, both Alipay and WeChat pay provide their own APIs which allow developers to implement payments on the website. Of course, you will also need to apply to be WeChat and Alibaba payment merchants.
Planning ecommerce is always a tough job because you have to take care of a lot of details and manage so many parties and services. It is much more than just choosing an ecommerce platform and getting going. To get it right, talk to the experts to work on your strategy and masterplan.