McKinsey report shines light on online-to-offline services
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As world’s largest and fast-growing e-commerce market, China is expecting the potentialgrowth of the online-to-offline services, which are cutting into incumbents’ margins, accordingto the latest McKinsey’s survey of China’s Internet users.
“Online-to-offline services can win consumers and even convince them to spend more thanthey might want to,” said Gong Fang, a partner at McKinsey’s Shanghai office.
China’s online retail market is the world’s largest after 2015 sales grew to approximately $630billion, nearly 80 percent bigger than that of the US. E-commerce in China accounts for 13.5percent of all retail spending.
“In an e-commerce market as large and fast as China’s, retailers and consumers will have noshortage of opportunities, especially in low-tier cities where online and e-commercepenetration remains relatively low,” said Alau Lau, senior partner and head of McKinseyDigital in Asia.
Questions & Answers
Q.Which specific geographical market does the McKinsey report focus on regarding online-to-offline services?
Which specific geographical market does the McKinsey report focus on regarding online-to-offline services?
The report specifically focuses on China, which is identified as the world’s largest and fast-growing e-commerce market. The survey was conducted among China's Internet users.
Q.What is the estimated value of China's online retail market and how does it compare to the US market?
What is the estimated value of China's online retail market and how does it compare to the US market?
China's online retail market reached approximately $630 billion after 2015 sales. This figure makes it nearly 80 percent larger than the online retail market in the US.
Q.What proportion of all retail spending in China is attributed to e-commerce?
What proportion of all retail spending in China is attributed to e-commerce?
E-commerce in China currently accounts for 13.5 percent of all retail spending. This indicates a significant but not dominant share of the overall retail market.
Q.Who stated that online-to-offline services could encourage consumers to spend more money?
Who stated that online-to-offline services could encourage consumers to spend more money?
Gong Fang, a partner at McKinsey’s Shanghai office, made this statement. He noted that these services can win consumers and even persuade them to increase their spending beyond initial intentions.
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