- tech360.tv
Amazon Expands Chinese Seller Network to Compete with Temu and Shein
Amazon is expanding its Chinese seller network to enhance its product offerings globally. The company is re-evaluating China as a source of goods for international sales. Partnerships with Chinese retailers aim to offer affordable products directly to U.S. consumers.
In a bid to support Chinese online sellers in entering the global market, Amazon hosted an event in Shenzhen, Guangdong province, at the end of July, showcasing success stories like Anker and Roborock, known for their global expansions.
Despite scaling back its consumer-focused operations in China, Amazon is now re-evaluating the country's potential as a source of goods for international sales, evident in the establishment of new offices in Wuhan and Zhengzhou to assist small and medium-sized sellers.
Amazon's WeChat account is actively engaging with potential sellers through live seminars, with plans to host numerous events for thousands of sellers by 2024, aiming to leverage its logistics network to facilitate global product sales.
The tech giant is also laying the groundwork to offer Chinese products to U.S. consumers at competitive prices, forging partnerships with Chinese retailers to enable direct shipping of affordable daily essentials and clothing to American customers.
Concerns over the growing influence of low-cost Chinese e-commerce platforms like Temu and Shein have prompted Amazon to accelerate its seller development initiatives in China, aiming to maintain its market presence in the U.S. and beyond.
A recent survey by Jungle Scout revealed a slight decline in U.S. consumers' preference for Amazon when shopping online, indicating a shift in consumer behavior towards exploring alternative platforms for their purchases.
While Amazon's direct online sales saw a modest 5% growth year-on-year in the April-June period, the company is adapting its logistics strategies to streamline operations and reduce costs, transitioning towards more direct shipping methods.
In 2023, U.S. consumers spent an average of 11 minutes daily on the Amazon app, contrasting with Temu users who dedicated 22 minutes daily, attracted by the platform's frequent coupon offerings.
At an earnings call on Thursday, Amazon CEO Andy Jassy admitted that shoppers continue to seek low-cost items.
China is becoming a more major provider of low-cost items, which advantages Chinese vendors who may increase sales through exporting in the face of slow local demand.
Cross-border e-commerce exports in 2023 were $261.7 billion, increasing 180% from 2018, according to China's General Administration of Customs. The United States was the most popular destination, accounting for 37%.
Chinese internet enterprises such as Temu, Alibaba Group's AliExpress, and ByteDance subsidiary TikTok are developing their cross-border e-commerce businesses by leveraging domestic business partner networks, hence increasing export value.
Amazon isn't the only international corporation looking to expand its listings beyond China. Shopee, a Singapore-based company, is also streaming seminars on WeChat in an effort to lure Chinese sellers interested in expanding into Southeast Asian markets, where it has a competitive advantage.
Amazon is expanding its Chinese seller network to enhance its product offerings globally.
The company is re-evaluating China as a source of goods for international sales.
Partnerships with Chinese retailers aim to offer affordable products directly to U.S. consumers.
Source: NIKKEI ASIA