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Meet Magento in China: Strategy and Expectations

Updated: Jun 2, 2018

2017 saw Meet Magento host its first conference in China.

Opening of Meet Magento Shenzhen 2017

It was fascinating to see for ourselves just how different China’s perception of Magento is, compared with every other part of the world we’ve been in.

Because although Meet Magento’s Shenzhen event was well attended, with an audience of 450, almost none of those present knew anything about Magento. Rather, they came with a hunger to learn more about eCommerce on a global scale.

China’s eCommerce market is the largest in the world, accounting for over 40% of global ecommerce transactions by value. Ten years ago that figure was only 1%.

So, given the success of our début and the massive potential for Magento in the Chinese market, it made sense for Meet Magento to establish a physical presence in China. At the beginning of 2018 we opened a Meet Magento Association (MMA) office in Shenzhen. It is small, but it gives MMA’s a foot on the ground.

Of course, many people see in China a huge market, and almost infinite opportunity. But being on the ground has given us opportunities to gain a particular view of the realities here.

China is already well established as a hotbed of eCommerce and online business. The massive penetration of mobile internet, combined with an exploding middle class population, has transformed China into the world’s digital and commerce frontier. The electrifying start-up scene has, over the last decade, created a self perpetuating, virtuous loop between online investors, entrepreneurs and the high-tech ecosystem.

This environment has led the Chinese ecommerce industry to develop different approaches and services compared to the rest of the world. It is much more consumer- and merchant-centric. Mobile payment is standard in China today — even beggars ask for WeChat gifts rather than hard cash.

Four factors underlie the phenomenal success and rapid expansion of digital China:

  1. A massive, highly digital, closed market In 2017, China had 783 million internet users — half of which solely use mobile. 74% make mobile payments. In fact, China’s transaction value for mobile payments is already 12 times the volume of the US, far eclipsing Europe. Yet, due to language and writing, it is a market largely closed to foreign business. As a local market it provides economies of scale, supports growth, facilitates immediate, widespread adoption of innovation, and provides an unparalleled variety of viable niches that enable companies to become competitive.

  2. A commitment to the ecosystem Successful Chinese entrepreneurs give back to their communities by building ecosystems, on a national scale. China’s three internet giants, Baidu, Alibaba and Tencent, operate at world-class standards. They transformed markets from offline into online. At the same time they built rich digital ecosystems and inspired and nurtured young talent. China’s digital ecosystems are now multifaceted and multi-industrial. Wherever consumers go, whatever they do, digital technologies touch almost every aspect of their lives.

  3. Strong government oversight The Chinese government played — and continues to play — an active role in building a world-class digital industry. The digital sector was “Wild West” in the beginning. The government introduced regulations in the digital sector in order to give local innovators like Baidu, Alibaba or Tencent space to experiment and learn. Today the government and the private sector work together to sustain a healthy digital development through regulation, enforcement and engagement. At the same time the Chinese internet market was and is protected. It is not only about language, writing or so-called intercultural differences. The government actively disconnected China from the rest of the world by a firewall and filtering system. It’s impossible for the outside world to see accurately what’s going in China.

  4. A crucible for competitiveness Free competition exists inside China, alongside open borders for global expansion. Competition inside China is unrelenting: customers, both B2B and B2C, are demanding and see little inherent value in loyalty. At the same time the huge scale of each sector creates opportunities to test new ideas and products. Successful companies have proven their business model or their product in a competitive environment. Only the fittest survive, but the fittest are perfectly prepared for the rigors of a global market.

In summary, China’s online and ecommerce industry is state-of-the-art. Players are based in, and protected by, the most powerful market in the world.

Meet Magento has always been a platform for the community. We want to provide an environment where merchants, business people, developers and everyone interested in ecommerce can meet and develop their business.

As a platform we need to continuously improve our services and expand the insights we offer the community, so it was pure logic to enter China. MMA’s Shenzhen office, and our upcoming conferences in China are the beginning of a solid foundation of Magento growth in China. On the inside, we’re engaging with Chinese developers, promoting the advantages of Magento and the opportunities that come with joining the Magento global community. For the Magento community on the outside, MMA China offers a unique opportunity to explore this fascinating, rapidly evolving digital ecosystem.

Join us in forging a new frontier for Magento and Meet Magento in China.