Shinsegae Department Store to strengthen online presence in China
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South Korean retail conglomerate Shinsegae Group that announced a complete pullout of its discount Emart stores from China instead has beefed up online activities in the world’s most populated and biggest e-commerce market.
Shinsegae Department Store said that it will open beauty and fashion shops at Tmall Global, China’s biggest online shopping platform operated by Alibaba Group Holding. It plans to gradually add other product lines like children’s goods and home appliances starting the latter half of this year. Through Alibaba that commands 80 percent of Chinese e-commerce market, Tmall has attracted nearly 800 million visitors last year alone. Shinsegae Department Store said it is the first Korean department store to open shops at Tmall.
To make it easier for Chinese consumers to purchase a range of merchandise offered by Shinsegae, the Korean retailer will allow them to pay with Alibaba’s mobile payment service Alipay and ship goods via the Chinese e-commerce giant’s logistics arm Cainiao. The company expects its partnership with Cainiao will help cut customs clearance time by two days.
Shinsegae Group has worked hard to attract consumers abroad via online retail platform. Following the opening of online marketplace SSG.com in Chinese, Japanese, and English language on top of Korean service, its online sales to Chinese customers nearly doubled in the first half this year compared to a year ago period.
“E-Mart Inc., a discount store unit of Shinsegae Group, recently decided to entirely pull out of China by the end of this year, 24 years after it first opened its store in the country.”
Outlook for online sales in China looks bright, too. According to Korean statistics bureau’s data, Chinese consumers’ purchases of Korean products through online shopping malls grew 6 percent during the first three months of this year, while the number of Chinese visitors to Korea dropped sharply during the same period. Cosmetics and fashion products especially sold well and their sales grew nearly 7 percent on quarter to take 90.2 percent of the country’s total online sales to Chinese consumers.
The company’s decision to attract Chinese consumers via online comes after other Korean retail giants have decided to close down their brick-and-mortar stores in China amid intensifying competition and dwindling sales. E-Mart Inc., a discount store unit of Shinsegae Group, recently decided to entirely pull out of China by the end of this year, 24 years after it first opened its store in the country.
But Shinsegae Group’s department store arm pins high hopes on its Chinese business that will be carried out via online. The partnership with China’s biggest online shopping mall has provided a chance for the company to grow its presence in global e-commerce market. The company also plans to add additional online shopping platforms in other countries such as Japan and the United States to provide online shopping services tailored for each market.
Questions & Answers
Q.What kind of products will Shinsegae Department Store initially offer on Tmall Global?
What kind of products will Shinsegae Department Store initially offer on Tmall Global?
Shinsegae Department Store will begin by opening beauty and fashion shops on Tmall Global. They plan to gradually add other product lines, including children's goods and home appliances, starting in the latter half of this year.
Q.How will Shinsegae Department Store facilitate purchases for Chinese consumers on Tmall?
How will Shinsegae Department Store facilitate purchases for Chinese consumers on Tmall?
To simplify purchases, Shinsegae will allow Chinese consumers to pay using Alibaba’s mobile payment service, Alipay. Goods will be shipped via Cainiao, the Chinese e-commerce giant's logistics arm, which is expected to cut customs clearance time.
Q.What recent trend indicates a positive outlook for Shinsegae’s online sales in China?
What recent trend indicates a positive outlook for Shinsegae’s online sales in China?
Korean statistics show Chinese consumers' online purchases of Korean products grew 6% in the first three months of this year. Cosmetics and fashion sales specifically rose by nearly 7%, comprising 90.2% of total online sales to Chinese buyers.
Q.Besides China, does Shinsegae Group have plans to expand its online retail presence in other countries?
Besides China, does Shinsegae Group have plans to expand its online retail presence in other countries?
Yes, the company plans to add additional online shopping platforms in other countries. This includes markets such as Japan and the United States, aiming to provide online shopping services tailored for each specific market.
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