How Chinese E-commerce Handles The Lockdown


Author: VEONIO

April 14, 2020

This article provides insight into how Chinese e-commerce is dealing with the global crisis with innovative technologies.

While in the global crisis, who will find solutions? Examining the situation in China, we will see how innovative technologies have been used to deal with the case, thereby drastically changing consumer behaviour.

How has Chinese e-commerce responded?

Innovation in Times of Crisis

The World Health Organization (WHO) stated in a statement on 9 March that cashless transactions should be used to combat the spread of COVID-19. Subsequently, China destroyed thousands of banknotes, an example that other countries quickly followed, thereby liquidating or quarantining huge sums of money.

Businesses have also adapted to the situation and immediately changed their business processes, while the Chinese national authorities and global organizations have tried to stop the spread of the virus.

Alibaba is Taking Advantage of Its Network

Alibaba’s Chinese e-commerce was among the first to offer their help. According to the Harvard Business Review, in addition to identifying manufacturing partners to begin the production of N95 masks, Alibaba was heavily involved in the distribution of supplies.

It also relied on its affiliate company – the digital payment system Alipay, which controls 55.32% of the third-party payment market in China – to push vital information on COVID-19 to Chinese consumers. This served as a lifeline for both Wuhan health workers and the general public, as the latter was still in urgent need of care.

Alipay helps retailers and consumers alike to comply with WHO recommendations. This alternative payment method allows businesses to continue to accept payments on contactless devices, while cramped households in their homes can use it to pay for online purchases. In addition, Alipay was used to raise donations for relief efforts. In the first eight hours alone, the charity raised more than $ 1 million.

MTDP Has Expanded Its Food Delivery Services to Essential Products

Meituan-Dianping, also known as MTDP, is a collective purchasing service that offers local food delivery, consumer goods and retail services. When the virus reached Wuhan, MTDP immediately began to expand its service to include necessitites. Working with thousands of brick-and-mortar supermarkets, the Chinese e-commerce giant has directed its efforts to deliver the goods there.

The nature of deliveries has also changed. All orders were paid for online, and 80% of customers requested delivery without a physical connection. According to the MTDP, this figure was 95.1% in Wuhan.

The message is clear. The digital transformation is happening at an unprecedented rate. Retailers who did not previously have an online presence are rushing to engage in e-commerce. To ensure survival, they turn to aggregators, such as marketplaces, who can serve ongoing customers.

Older Users are Embracing Chinese E-commerce

One last thing. The crisis has also changed the level of consumer demography. If before that the older generation still resisted online payments, this is certainly not the case today. The pandemic forced them to adapt. As they are the most vulnerable members of society, so did older consumers when they started shopping online.

Payment service providers need to meet the changing needs of their e-commerce customers. Chinese e-commerce requires simplification of the payment process for older generations, which is why ECOMMPAY has developed a hassle-free payment experience where payments are made with one click and can be used across many platforms.

Despite the difficulties caused by the pandemic, new opportunities are emerging. E-commerce companies and their payment service providers need to be able to have flexible resources to adapt quickly. Now more than ever, businesses need an omnichannel approach to ensure seamless, digital payment and commerce through payment channels.

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