Ecommerce Thesis

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 Abstract

Ecommerce is known as the buying or selling of the products electronically or over the internet.

The term was first used in 1984 by Dr. Robert Jacobson who was the principle consultant to the

California state assembly and corporate committee. With the advent of fast speed internet and

smart devices, ecommerce has become widely popular and the number of ecommerce consumers

have increased across the globe. Like other countries around the globe, China is also a

technologically advance country that has set up the infrastructure of ecommerce in the country.

In fact China has become the largest ecommerce market around the globe, and the commodity

market of ecommerce in China is constantly growing.

There are different factors that have contributed in the success of ecommerce in China that also

includes the advances in the payment system, ease in taxation and other governmental policies

regarding import and export that has increased the scope of ecommerce platform. Chinese

ecommerce platforms have ties with several stakeholders within and outside the country and are

improving their infrastructure to facilitate the consumers in best possible manner. Both the

competition and number of ecommerce users are increasing that has made the Chinese

ecommerce market competitive and one of the largest in the world. Many researchers have thus

focused on the Chinese ecommerce markets and have studied the trend of the markets. But there

has been a lack of research in terms of the situation analysis of ecommerce platforms in China

and the satisfaction level of the ecommerce users in China. Thus, this research is directed in a

direction that would use both primary and secondary research to analyze the current trends in the

commodity market of Chinese ecommerce along with the satisfaction level of the users. Likert

scale would be used to quantify the primary data to analyze it and make recommendations to the

ecommerce platforms based on the primary and secondary research result.

Contents
Abstract............................................................................................................................................1

Chapter 1: Background to the Research..........................................................................................4

Introduction......................................................................................................................................4

Problem Statement.......................................................................................................................6

Research Objectives.....................................................................................................................7

Research Hypothesis....................................................................................................................8

Research Significance..................................................................................................................8

Chapter 2: Literature Review.........................................................................................................10

i. History of Ecommerce Platforms.......................................................................................10

ii. Payment System..................................................................................................................12

iii. Chinese Governmental Policies for Ecommerce................................................................15

1. Types of Business Allowed.............................................................................................15

2. Tax Regulation................................................................................................................16

3. Rules and Regulation......................................................................................................16

4. Competition and Consumer Protection...........................................................................16

iv. Role of Recent Technology in the Growth of Ecommerce.................................................17

1. Smart Inventory System..................................................................................................17

2. Fast Delivery System......................................................................................................18

3. Promotion through Social Media Platforms....................................................................19

 4. SEO and PPC Technology..............................................................................................19

5. Role of AI and IoT..........................................................................................................20

v. Ecommerce Growth Worldwide.........................................................................................21

1. COVID-19 and Ecommerce Sales..................................................................................22

2. Chinese Ecommerce Platforms.......................................................................................23

3. Chinese Cross-Border Ecommerce.................................................................................25

Research Gap.............................................................................................................................25

Chapter 3: Methodology................................................................................................................27

Introduction................................................................................................................................27

Research Design........................................................................................................................27

Justification of Research Design...............................................................................................28

Description of the Participants...................................................................................................29

Sampling Method.......................................................................................................................30

Sample Size...............................................................................................................................30

Questionnaire.............................................................................................................................31

Quantitative Data Analysis........................................................................................................31

Ethical Considerations...............................................................................................................32

Chapter 4: Findings........................................................................................................................33

Demographics............................................................................................................................33

i. Gender.............................................................................................................................33
 ii. Age Group.......................................................................................................................33

iii. Education Level..............................................................................................................34

iv. Income Group.................................................................................................................35

v. Occupation......................................................................................................................35

Satisfaction Level of the Ecommerce Users..............................................................................36

Technology and Chinese Ecommerce Platforms.......................................................................38

Purpose of Using Ecommerce Platforms...................................................................................40

Chapter 5: Results and Recommendations....................................................................................42

Recommendations......................................................................................................................44

i. Use Brilliant Product Description...................................................................................44

ii. Stop Forcing the Users to Register Before Buying.........................................................45

iii. Consensual Usage of User Information..........................................................................45

iv. Improved Last Mile Delivery System.............................................................................46

v. Real Time Tracking Option............................................................................................46

References......................................................................................................................................47

Appendix........................................................................................................................................50

Questionnaire.............................................................................................................................50

Demographics................................................................................................................................50

Findings.........................................................................................................................................53

Demographics............................................................................................................................53
i. Gender.............................................................................................................................53

ii. Age Group.......................................................................................................................53

iii. Education Level..............................................................................................................54

iv. Income Level...................................................................................................................54

v. Occupation Level............................................................................................................55
 Chapter 1: Background to the Research

Introduction

With the advent of modern technologies and fast speed internet, different facilities are introduced

for the consumers that has eased their lives. One such facility is that of ecommerce, where the

consumer can buy and sell products/commodities on internet without visiting the physical stores.

Not only it saves time, but also saves the cost of transportation and the reviews given by different

consumers on different ecommerce platforms makes it easy for the consumer to make a purchase

decision. The term ecommerce was first used by the Principle Consultant to California State

Assembly Dr. Robert Jacobson. Ecommerce is not only related with buying and selling of

products, but is also related with electronic funds transfer, supply chain management, electronic

data interchange, online banking, etc. Thus, ecommerce is a wide term that is encompassing

different services available on the World Wide Web (WWW) or smartphone applications under

its umbrella.

Conventionally, ecommerce was based on the email system, but the advent of fast paced internet

has changed the concept of ecommerce. Different ecommerce platforms started from mere

purchase of specific commodities such as book, or electronic items, but their scalability depicts

the drastic changes that have taken place during the last 3 decades. The example ecommerce

leader Amazon is in front of everyone, that how a small book-selling online platform has

developed itself to be the biggest ecommerce platform across the globe providing other services

such as cloud computing, digital streaming, Artificial Intelligence (AI), etc. Similar is the case
with Chinese giant ecommerce platform Alibaba that started off as a B2B marketplace site and

scaled itself to be the one of the largest ecommerce platform across the globe.

Ecommerce as the name indicates is a process of buying and selling different commodities

using a web platform. Not only ecommerce includes the sales of goods, but transfer of

money, and data to execute these transactions is also studied under the umbrella of

ecommerce. Over the years, with the improvement in the internet services and security of

data, the number of ecommerce platforms have grown substantially. In addition to this, the

trust of the users on different ecommerce platforms has also increased and they are

preferring to use these platforms over the conventional physical shopping.

Ecommerce constitutes of online shopping, B2C or C2C sales, gathering demographic data

through different social media platforms, B2B data exchange, and online financial

exchange to execute different orders. Particularly talking about China, the ecommerce

industry is growing and China has slowly become the largest ecommerce industry around

the globe. The ecommerce giants such as Alibaba, JD.com, Pinduoduo, etc. have taken

more than 83% of the retail ecommerce in 2020 that depicts the market place of China in

ecommerce industry. The initiatives taken by China has brought socio-economic impacts

in the ecommerce industry. The network of road connecting Europe to Africa to Asia, has

enhanced the road transport infrastructure that is a bright sign for the ecommerce

industry. China has also enhanced the international ties with different nations that would

also enhance the ecommerce business. Thus, the major developments in the Chinese

ecommerce platforms are to be analyzed and needs to be connected with the past and

future developments.
Many similar examples can be quoted over here where small ecommerce enterprises have

emerged to be the market leaders due to the development in the gadgets and internet technology.

The impact of other technologies such as AI and IoT has also helped the ecommerce platforms to

increase their outreach. These technologies have helped the ecommerce platforms to collect data

about the consumer shopping preference and patterns to improve their product portfolio and

product offerings. Now a days, different ecommerce platforms are seen to be targeting specific

customers and selling them specific products through online marketing. The timeline of the

ecommerce industry illustrates that different countries have played a major role in the progress of

this industry and China is one such country.

According to Statistica, (2021) China is the biggest ecommerce population around the globe with

710 million individuals shopping on different online platforms. 76% of this population is in the

age group of 18 to 44. Another report suggested that the Chinese ecommerce spending would go

up to USD 1.1 trillion from USD 800 million in 2019. These figures are around 2.5 times greater

than the US spending of USD 360 million on ecommerce platforms and EU’s spending of USD

319 million on online shopping platforms. Not only this, but the 5 brands the top 100 ecommerce

platform are operating within the Chinese markets. This illustrates the importance of Chinese

ecommerce market around the globe, and this thesis is focused on the analysis of Chinese

commodity market of ecommerce. The changes in the ecommerce trends and advancements in

the technology makes the past, present and future of the Chinese ecommerce much important.

So, the thesis will analyze the past, present and future of the Chinese commodity market of

ecommerce. In addition to this, the ecommerce platforms around the globe would be analyzed

and the role of Chinese political system would be analyzed in terms of past, present and future of

the ecommerce platforms. With the rising number of ecommerce platforms available worldwide,
there has been an increased research on the topic of ecommerce. Different researchers have

played a major role to understand the framework of contemporary ecommerce platforms. But

there has been a lack of such research that eventually develops from the past of ecommerce

platforms to their present and the future developments that could take place in these platforms.

Problem Statement

The Chinese ecommerce industry has become the leading ecommerce industry in the world.

The governmental policies regarding taxation, finance, import and export has increased the

number of ecommerce platforms in China and different researches have been conducted on

the topic of ecommerce in China. But the researches depict a clear gap in terms of the

situational analysis of the ecommerce platforms in China and the consumer satisfaction

using these platforms. This needs to be explored and this research is focused on this

particular task, where the past ecommerce framework would be understood to develop an

insight into the present and the future developments.

This research is particularly focused on the Chinese ecommerce platform. The Chinese

market position in the ecommerce industry has enhanced significantly during the last

decade and for now China is holding a significant position in the ecommerce industry. So, a

current situational analysis would be conducted along with the analysis of the customer

satisfaction with these ecommerce platforms. This would give an insight into the current

Chinese ecommerce industry in terms of its strengths and key points.

Research Objectives

Chinese commodity market of ecommerce has become an important research topic given the

recent rise of the Chinese ecommerce platforms. These platforms have not only become common

in the Chinese markets, but also in different countries around the globe, but to narrow down the
scope of the research, we are currently only focusing on the Chinese commodity market of

ecommerce. The past, present and future of the Chinese commodity market of ecommerce is the

focus of this research. For this purpose, the secondary resources would be analyzed and the role

of governmental policies, technological advancements, Chinese cross-border ecommerce, etc.

would be analyzed. This would give an idea about the present and past of the Chinese

ecommerce platforms. The research objectives are thus stated below:

1. To give situation analysis of the present e-commerce in China.

2. To anticipate the possible future movement of China’s E-commerce by determining

the satisfaction level of the Chinese ecommerce platform users.

These research objectives would give an in-depth insight into the Chinese ecommerce platforms

and its users.

Research Hypothesis

Looking at the growth of ecommerce markets around the globe, it can be said that the upcoming

era will be dominated by these ecommerce platforms and commodities would be purchased

online. And the recent progress of ecommerce platforms is due to the rapid increase in the

internet usage and advancements in the technology. It is not wrong to assume that around 90% of

Chinese commodity market of ecommerce would be based on the ecommerce platforms and their

performance. Majority of the consumers would be purchasing the commodities from these

ecommerce platforms and China would be in a dominating position in the ecommerce market.

Following mentioned are our research hypothesis:

 1. Commodity market of ecommerce in China will further evolve in the future and

become the top commodity market around the globe due to the developments in the

security infrastructure, and international partnerships

2. The satisfaction level of the consumers using ecommerce platforms is increasing

with every passing day after considerable reduction in e-risks associated with

ecommerce platforms. These consumers are also confident in sharing private

information with the platforms that is increasing their overall performance.

Research Significance

The Chinese ecommerce market is considered as the largest market around the globe, and its

significant growth during past 5 years has made it even an interesting subject to research. The

Chinese economy is itself thriving and more than one billion consumers are inclined towards the

Chinese ecommerce platforms to buy different products. So, the history, present and future of the

commodity market of Chinese ecommerce is an interesting subject.

Chinese ecommerce revenue is even higher than the US and the European Union markets so the

analysis of the ecommerce giant is necessary. Furthermore, the consumer satisfaction level, role

of technology, etc. are some factors that are important to be analyzed in the success of Chinese

ecommerce platforms. Looking at the current growth, it is expected that the Chinese ecommerce

will grow and the analysis of Chinese ecommerce will help us to analyze the commodity market

growth of ecommerce. Similarly, the role of Chinese governmental and taxation policies has also

contributed to the growth of the ecommerce platforms. These all factors along with Chinese

consumers are important to analyze and thus makes this research significant.
 Chapter 2: Literature Review

This chapter would discuss the key readings related to the Chinese ecommerce platforms and

ecommerce platforms all around the globe along with the role of technology.

i. History of Ecommerce Platforms

Reynolds, (2000) critically analyzed the advancements in the ecommerce platforms and its

progress in the late 1990s. The author reported that the increase in the stock valuation of internet

in 1999 played a major role in the progress of online B2C platforms. However, the American

Silicon Valley was initially hostile towards the online B2C and B2B platforms that impacted its

growth. It is to be noted that the ecommerce platforms initially emerged from the American

Silicon Valley, and the Chinese stakeholders recognized it as an opportunity to grow. The

developed retailers did not take the ecommerce brands much well and were not ready to

incorporate this strategy in their business (Reynolds, 2000). But the author critically analyzed the

top retailers in 2000 and concluded that the top retailers in 1960 eventually disappeared by not

adopting the modern changes. Similarly, majority of the top brands in 1997 were not existing 10

years ago. So, ecommerce platforms provided an opportunity to the retailers to capitalize over

and grow their business. Ecommerce platforms are based around knowledge-based investments,

alliance-based investments and productivity-based investments (Leong et al., 2016).

Sales based orders (SBOs) and efficient consumer response (ECR) has played a major role in the

development of ecommerce platforms and decreasing the prices of the commodities creating

barriers for the regular brick and mortar retailers (Reynolds, 2000). Although, the research has

raised some key points, but there is a gap in this research regarding the expensive internet
technology and its access to limited number of people. The reservation of brick and mortar

retailers in integration of internet technology in their operation is due to the limited access of

internet in that era and the inclination of the consumers towards the regular physical stores where

they can analyze the product by themselves before purchasing it.

Shen, (2019) presented some important facts comparing the development of ecommerce

platforms in China and the US. Both countries have huge name in the current ecommerce

market, but have different histories when it comes to the development of ecommerce platforms.

Analyzing China, it can be seen that the ecommerce growth in China started in the late 1990s

(1997, 1998) when IT vendor and media stakeholders were dominating the ecommerce market

(Leong et al., 2016).

The major advancements in 1999 were the ecommerce websites that took over ecommerce

business in China. The Chinese stakeholders were analyzing the rapid inclination of the Chinese

nation towards internet technology and capitalized this opportunity to dominate the market. The

Electronic Signature Law in 2004 helped the Chinese government to understand the importance

of ecommerce platforms and their role in the economy of the country (Shen, 2019). The author

also analyzed the prevailing situation of Chinese ecommerce markets and analyzed that despite

being the host country of various ecommerce platforms, only 25% of small-sized and medium-

sized retailers are operating their business online. This clearly depicts the lack of insight of the

Chinese stakeholders in the latest developments and internet technology (Shen, 2019). The

Chinese government has enacted laws for the growth of ecommerce, but there is a significant

difference between the global outreach of Chinese brands when compared to the US brands. The

global average transaction of the American platforms is around 50% in contrary to 7% global

transaction of the Chinese ecommerce (Leong et al., 2016).

This was due to the differences in the political ties of China with developed nations and the US

with the developed nations around the globe. Alongside China and the US, the European markers

showed great inclination towards the ecommerce platforms, but the history of China and

European nations was the greatest barrier for the Chinese ecommerce platforms to gain global

popularity. The political policies of China also depicted hostility towards the European nation

that was the major reason for less global recognition of Chinese ecommerce platforms around the

globe during the initial stages. Similarly, the history of ecommerce illustrates that the Chinese

stakeholders were not that quick to adopt the concept of ecommerce as compared to the US

market. The renowned retailer giant Walmart used the concept of EDI in 1980s, and this concept

was much closer to the current ecommerce practices used to sale different commodities to the

consumers (Shen, 2019). There was a difference in the governmental approach, as the US

government was a big proponent of ecommerce. In contrary to this, the Chinese government was

not inclined towards ecommerce platforms until 2001, when Jack Ma (founder of Alibaba group)

proposed to establish an ecommerce platform. The founder of Alibaba group was not assisted by

any government official or individual stakeholder (Shen, 2019). But later on, the Chinese

government acknowledged the importance of ecommerce platforms and role of ecommerce in

developing the economy of the country and established policies that have resulted in the current

success of ecommerce in the country.

Logistics are considered as an essential part of ecommerce platforms, and they require an

entirely new distribution infrastructure to manage online business. The US has a logistics system

that is around 10% of the US GDP. The past Chinese policies were not focused on the logistics

system, and the recent developments depict that the Chinese ecommerce platforms lagged behind

in the past due to the logistics policies (Shen, 2019).

 ii. Payment System

Chinese markets are different from other markets due to restrictions to certain social media

platforms and banking transaction systems. Like other countries, where VISA and MasterCard

are much common amongst the consumers for payment of the commodities, the Chinese vendors

are less inclined towards these international transaction systems (Kharpal, 2019). WeChat Pay

and Alipay are two most common payment systems accepted by the Chinese ecommerce

retailers. In the past, the users could not use these two payment systems unless they had a

Chinese bank account. This made it difficult for the vendors to integrate in the international

markets, as the majority of the international consumers did not have a Chinese bank account, and

the vendors were not accepting other payment methods widely used around the globe (Daxue

Consulting, 2020).

This system is changed recently, as Alibaba has affiliated with Ant Financial run and WeChat

pay has introduced the QR code payment system that will support international credit/debit cards

(Yang, 2017). The consumers can now download the Alibaba pay application on their

smartphones and register themselves even with a foreign mobile number that has increased the

payment system convenience for the users (Kharpal, 2019). The users can even top up money in

their virtual Alipay card that can be used for ecommerce purchases. Ant Financial recently made

a statement that the VISA, MasterCard, Japan’s JCB and Singapore’s Diner Club cards are now

also acceptable on Alipay system. Similarly, WeChat is also accepting the American Express

cards that is increasing the international interest in the Chinese ecommerce platforms (Kharpal,

2019).

The recent pandemic situation has also tested the Chinese payment systems as there was a surge

in the ecommerce platforms during these days. The closure of brick and mortar stores shifted the
consumer attention towards online platforms to get their products. Although, 92% of the Chinese

consumers were already using online payment systems in both rural and urban areas, yet the

COVID-19 pandemic depicted a steep curve increasing the usage of online payment systems.

The Chinese online platforms dealt with USD 1.35 billion capital and the online transactions

increased by an overwhelming 54% (Daxue Consulting, 2020). The offline barcode mobile

payment was also increased by 48% during this time.

Also before the pandemic, around 82% of the payments were done through online payment

channels, and the Chinese consumers are inclined towards the online payment system in place of

cash payments (Daxue Consulting, 2020). The below figure illustrates the difference between

mobile and non-mobile payments during last decade:

Figure: Market Share of Mobile vs Non-Mobile Payments in China (Daxue Consulting, 2020)
The figure illustrates a major spike during these 8 years, when the mobile payment in China

reached to an overwhelming 83% in 2018 as compared to 3.5% of the mobile payments in 2011.

The rise in the mobile payment is more evident since 2014, when the figures were almost

approaching towards 50% (Daxue Consulting, 2020).

The increase in the mobile payment system and online payment system has increased the scope

of ecommerce platforms, as the consumers can pay for the commodities using different payment

channels. In addition to this, the international consumers are also attracted towards the

ecommerce platforms due to affiliation of the payment system with international cards that can

be used to make the payments (Yang, 2017). The experts believe that the ecommerce and m-

commerce platforms are also supposed to grow after the introduction of these payment methods.

In the past, the online growth has been slow but the recent developments depict bright prospect

for the ecommerce platforms.

iii. Threats Associated with Ecommerce

There are various instances, when the customers were plundered off their valuable savings

in the name of ecommerce. Following are a few threats that are majorly associated with

ecommerce industry.

1. Malware

Malware is a term used to deal with viruses and hacking information. The malware is used

to hack personal data from the computer or to destroy the user’s information or important

tasks. So, the greatest threat found in the e-commerce business is malware (Rahman &

Tomar, 2021). It is because malware can enter the computer or can hack the website or

personal information. Through the hacking process, all the data and customers' details can

be accessed by hackers that can be very dangerous for the customers as well as business
owners. Moreover, different viruses can destroy the website completely that can cause a

great loss for the business (Rahman & Tomar, 2021).

The malwares are mostly injected in the checkout page, where the consumers are

calculating their total cost of purchase and enter their financial details (credit card

number, debit card number, security code, etc.) to complete the financial transaction

(Yang, 2017). The POS malware is less effective and profitable now as compared to a

decade ago, so the hackers are trying different malwares that would steal the personal

details and analyze the shopping patterns of the consumers that can be helpful in finding

the vulnerability of the consumer and targeting them according to that vulnerability.

Malware ecommerce crimes have increased by 400% all around the globe since 2018, and

the java script malware can directly send the card details and other personal information

of the user from the checkout page to the hacker’s system that can be sold or analyzed to

detect the vulnerability of the consumers.  SQL injection to exfiltrate data from externally

hosted e-commerce servers is resulting in creation of ecommerce websites with fake

domains that can be used to plunder the customers off their belongings (Yang, 2017). This

particular frauds has increased substantially during the last 2 years, and the cyber security

of the ecommerce platforms is unable to deal with these infiltrations.

2. Frauds

E-Commerce business was helping many clients to buy their product in just minutes,

similar there is an increase in the fraud cases are increasing day by day which is imposing

the threats to the e-commerce business (Rahman & Tomar, 2021). As all the client's details

are available on the computer any hacker or virus can access the information of the credit
cards and through this, all the money can be withdrawn or the hacker can buy the product

using the customer’s credit card. Such frauds can cause many complications and due to

this the customers avoid to prefer the e-shopping and hence the e-commerce business

suffers the most and the frauds can be of various type i.e. friendly fraud, check fraud, etc.

in check frauds, wrong or bank erupted checks are sent as a payment to the organizations

and as a result, the e-commerce business face a big loss. In short, frauds are becoming the

greatest threat in e-commerce (Rahman & Tomar, 2021).

The frauds are also associated with the product quality and product quantity. Different

ecommerce platforms depict certain product with attractive visuals and offers, but the real

product delivered to the consumer is totally different from the committed product. This

impacts the confidence of the user ordering products from different ecommerce platforms.

In addition to this, the product quantity can also be an issue, as some consumers order

products in bulk that is not delivered the same by the supplier. This also creates issue for

the ecommerce users as they face inconvenience in terms of enjoying the same product

received from the digital supplier and has to face inconvenience in complaints and

replacement of products.

3. Bots

Bots are the sort of program that is usually performing the similar function on any website.

Now the bots are of two type’s i.e. Good bots and bad bots (Wang et al., 2017). Good bots

are utilized to perform better results and in avoiding the major problems whereas bad bots

are serious threats in the e-commerce business (Rahman & Tomar, 2021). This is because

the bad bot affects the function of the website of the server get down and the speed of the

website becomes slow which consumes a lot of time in accepting orders and in further
processing. This becomes difficult for the customer in buying the product as it consumes a

lot of time. These bad bots affect the working of e-commerce. Moreover, bad bots include

the price scraping bots. These bots are usually sent by other companies so that internal and

secret strategies can be monitored and tough times can be given to other organizations

(Wang et al., 2017).

4. DDoS

DDoS (distributed denial of service) is another threat that is faced by e-commerce owners.

In DDoS, the server is mostly filled with a larger number of requests with fake IP

addresses. These thousands of servers affect the website and the websites usually crash due

to heavy load. As the website crashes, it gives a chance to other hackers and viruses to enter

the website and get access to all types of data. Hence, DDoS is also one of the major threats

in the e-commerce business (Wang et al., 2017).

iv. Chinese Governmental Policies for Ecommerce

The Republic of China is well known for its e-commerce market in the world and most of the

population prefers online shopping from China (Han, 2018). China is selling luxurious products

at a very cheaper rate and earning a lot of profit by certain laws had been enforced on the e-

commerce market. The law was announced in 2016 with amendments in 2018 and 2019.

1. Types of Business Allowed

This law clarifies the type of businesses that can be governed. According to this law, all the

legal persons and incorporated companies can provide a chance for the e-commerce businesses

and they can also help other parties in continuing their online business (Luo, 2016), (Han, 2018).
Other than all those individual who is doing e-commerce business using social media accounts

and official websites are allowed to continue their businesses (Su et al., 2019). Besides, all the

third parties and vendors can also continue the online business but according to the law, all these

businesses should register their businesses and a license will be provided to all these e-commerce

businessmen otherwise the business owners would face serious problems and their business can

face serious threats (Han, 2018).

2. Tax Regulation

Furthermore, according to the law, these e-commerce companies need to pay taxes, and also they

should demand taxes on their products from the customers and as a result, they should issue the

invoice receipt to the customers. The companies should inform the tax authorities regarding all

taxes and according to law, the companies had to submit the past three years' transaction slips to

the tax authority departments (Luo, 2016).

3. Rules and Regulation

In China, it was implemented through the law that the companies should design certain rules and

laws for the customers to protect the privacy of the company and the companies should deal with

the customers with respect and in case of any problem the companies are responsible to solve the

problems in the best manner (Han, 2018). Other than it, the company should register themselves

with the State administration of Industries and commerce in order to protect their rights. In case

any violation is observed and the company is not registered then owners will be held responsible

and will be fined and chances are opting unfair means to the business can lead the company

owner to face certain cases and can be jailed (Han, 2018).

 4. Competition and Consumer Protection

According to the law imposed in 2019, e-commerce companies should face competition from

other companies and try their best in giving the tough competition instead of accusing those

companies (Su et al., 2019). Other than it the law also enforced that consumer protection should

be the first and utmost priority of the company. Moreover, the company should try to provide the

best product to their customers, and in case of any problem, the company should inform the

consumer and try to solve the problem as soon as possible (Luo, 2016). In addition, the company

should also try their best to deliver the product on time to gain a good reputation and earn the

profit. These all laws also facilitate the e-commerce business yet it also creates some problems

for the company (Han, 2018).

5. Regulation of International Markets

China is keen to regulate the ecommerce marketing to regulate the issues such as product quality,

competition, after sales services, consumer compliance, etc. There was also an issue of

imbalance in tax collection when compared with the actual goods imported/exported in or out of

the Chinese markets. The Chinese economic structure is offering strict laws for taxation that

would alleviate any tax theft or money laundering in the name of ecommerce. Chinese

government is keen to sell luxury goods in the Chinese markets, and the regulation of taxation

and certain laws associated with ecommerce would regulate the flow of products in markets

(Shen, 2019).

Two significant moves have already depicted that the Chinese government is aware of the

importance of ecommerce platforms in the country. The new ecommerce laws came out in

January 2019 that enhanced the tax regulations and regulation of issues such as product quality,

competition, after sales services, etc. to enhance the government benefit from these ecommerce
platforms as well as increase the Chinese consumer experience using ecommerce platforms. The

tax regulations also scrutinized the imports and exports of the country in the name of ecommerce

that alleviated money laundering and other black market operations that were conducted

previously in the name of ecommerce (Shen, 2019). China also joint 76 nations in Joint

Statement on e-commerce that supports the ecommerce operations around the globe and the

creation of ecommerce rules by WTO. After the accession of China by WTO, the FDI has

increased and the overall Chinese markets have flourished. Same would be the case with WTO

ecommerce regulations that would enhance the confidence of ecommerce operators in China as

they would have international regulations to follow that would enhance their business as well as

the customers in China and all around the globe. Thus, the Chinese regulations are playing a

major role in the progress of ecommerce in the country (Shen, 2019).

v. Role of Recent Technology in the Growth of Ecommerce

The field of ecommerce has bloomed in the recent decades, when the internet technology and

other high-tech gadgets were introduced. With the advent of faster internet, people have all

information in their hand regarding their own business or any other activity around the globe that

helps them to structure their future policies (Su et al., 2019), (Shen et al., 2019). The latest and

intelligent gadgets even have the ability to filter the relevant and authentic information regarding

a specific business that has benefitted the ecommerce around the globe including the Chinese

markets. Internet and gadgets have become an essential for smooth operation of business and

especially the ecommerce business is ran with the help of internet and related technology (Han,

2018). The rapid support of the ecommerce platforms via online channels, the sales of various

products have grown over the last few decades. Different technologies have helped in supply
chain management, online transactions, electronic data exchange that has resulted in the growth

of ecommerce platforms in the recent era (Zeng et al., 2012).

1. Smart Inventory System

Starting with the inventory, internet and latest gadgets have made it possible to alleviate shortage

of any product. The giant ecommerce platforms such as Amazon and Alibaba or the medium or

small-scale platforms have invested in the smart inventory system that notifies the inventory

manager regarding the shortage of any product in the inventory (MANSUR et al., 2019). This

aids the inventory manager to take timely decisions and order the products well in time to

increase the consumer experience. Consumer experience is the major point in ecommerce

platforms especially in this modern age, when the consumers can switch between many available

ecommerce platforms. Amazon has invested in smart inventory system that directly generates the

mails to the suppliers regarding the shortage of any product. In case of shortage of product in the

supplier’s inventory, the smart inventory system looks for the alternate options that has made

Amazon the first choice of the consumers (MANSUR et al., 2019). There are very few products

that are out of stock on the Amazon’s platform. And this model is followed by the new entrants

in the market that is increasing their competitive advantage. This is just the inventory system that

deals with the ample availability of the products (Shen et al., 2019).

The smart inventory system is also helpful in deciding the product portfolio by calculating

the statistics of sales of different products. The product high in demand would be procured

in a greater quantity as compared to the out of demand products. This is helping the

ecommerce platforms in alleviating the extra procurement costs increasing the profit

margins for the ecommerce platforms. In addition to this, the smart inventory system is

able to reduce the warehousing cost of storing extra products in the warehouse (Shen et al.,
2019). Inventory management system has thus become a necessity in the modern

ecommerce and different ecommerce platforms are flourishing be implementing these

solutions.

2. Fast Delivery System

Secondly, the rapid rise in the technology has helped the companies to upgrade their delivery

system (Pogorelova et al., 2014). Different ecommerce platforms have launched their own last

mile delivery system that is focused on the goal of fast product delivery to the consumers.

Amazon and Alibaba have invested in Amazon Prime and Tmall that are two membership

programs availing which the consumers can enjoy fastest delivery services (Gupta, 2014).

Different ecommerce platforms have used the latest transportation technologies for their

advantage by establishing several stores in different areas. The stores are filled with products that

are in rapid demand in that particular area. This helps the ecommerce platform to fulfill the needs

of the consumers in best possible manner. Investing in the ecommerce stores nearby living areas

can save the transportation cost as well as the time to deliver the products. The Amazon prime

consumers can enjoy the delivery of their desired product in less than 2 hours. Similarly, Alibaba

has also decreased the delivery time of commodities in demand all around the globe (Pogorelova

et al., 2014).

Last mile delivery system of Amazon is exemplary as it is has set different standards in

delivering the products to the consumers (Kumain et al., 2020). The massive distribution

centers located across various cities is making Amazon virtually sell every possible product

in different cities. Amazon Prime is an absolute modern day service that is delivering

products to the consumers in less than 2 hours of order that too free of cost. Although, the

consumers pay an annual subscription of the service, but Amazon is providing its
streaming service in the same annual subscription that is attracting a lot of consumers

towards the ecommerce platform. Amazon has made the consumers believe that they need

fast delivery and it is possible that by effective strategic management, every ecommerce

brand can facilitate the consumer by supplying products at a faster pace (Kumain et al.,

2020). The size and scale of Amazon has made it difficult for the companies to meet its

standards and that is the competitive advantage of the American ecommerce brand over

the other ecommerce brands. Around 20 years ago, the promise of fast delivery was mere

an aspiration of different brands that has become a reality in modern day business due to

effective strategy and implementation of technology in the delivery services (Kumain et al.,

2020).

3. Promotion through Social Media Platforms

The promotion of the platforms is also done through these latest social media platforms. The

ecommerce platforms have dedicated social media teams for each of their market that is focused

on introducing attractive deals and offers for the specific target market (Shen et al., 2019). These

deals and offers vary with respect to the location and consumers. The promotion is also done

through social media applications. According to Statistica around 3.6 billion people are using

social media platforms around the globe and these figures will touch around 4.5 billion by 2025

(MANSUR et al., 2019). So, the ecommerce platforms have the advantage of understanding the

advertising algorithms and social media platforms are widely used by these platforms to increase

their outreach and number of customers (Pogorelova et al., 2014).

The social media platforms also allows the consumers to share their purchases with friends

and family members. The platforms can also serve as a communication pathway between

the consumers and company representatives. Some ecommerce platforms use social media
as a backup to conduct direct sales. The inclusion of payment services in different social

media platforms has made it easy for the ecommerce companies to use them for direct sales

(Shen et al., 2019). The followers, likes and dislikes of different ecommerce platforms can

also be used as a way to advertise their service and depict the global following to the new

consumers.

4. SEO and PPC Technology

Along with social media platforms the outreach of the web platform can also be increased by the

latest SEO (Search Engine Optimization) and PPC (Pay per Click) technology. SEO technology

revolves around the keyword frequency and appropriate usage of keywords on the platform that

would increase the website trafficking. SEO improves the search engine results and search

engine position of the platforms that helps the platform to get organic and undisrupted traffic on

their web platforms. Similarly PPC is used to buy the visits to the website (Blázquez, 2014).

Using this technology, a small advertisement of the ecommerce platform would be displayed on

the famous websites such as Twitter, YouTube, etc. and clicking on the advertisement would end

up the viewer on the ecommerce website. This technique has widely became popular and used by

the ecommerce platforms to increase their visitors and regular consumers. But the government

again plays a major role in the promotion of different ecommerce services as different

governments have different rules for the advertisement on social media platforms and the

restrictions vary country to country (Blázquez, 2014).

5. Role of AI and IoT

AI and IoT is another technological advancement that has helped in the improvement of the

ecommerce services. With the passage of years these technologies have eventually became better

and better benefitting different businesses around the globe. AI is helpful in stock management.
There are many instances where the ecommerce platforms buy a lot of stock that is difficult to be

offloaded resulting in cluttered warehouses (Shen et al., 2019). Eventually, the platforms have to

offer awkward discounts to offload the stock and make space in their warehouses. Similarly,

buying little stock can also frustrate the customers as the major products will be out of the stock

most of the times (Gupta, 2014). But AI can be helpful in analyzing the sales data of the

particular location and help the inventory manager to buy optimum stock that would be offloaded

without damaging the cash flow. Optimal stock quantities have increased the profit margins of

the ecommerce platforms. Similarly, AI can be useful for the starters who are dreaming to build

their own ecommerce platforms. IoT and AI based ecommerce platform blueprints can be built

using the advanced software that would mimic the framework of famous ecommerce platforms

facilitating the new starters. IoT collects the consumers’ data for the betterment of services. This

data can be used by the ecommerce platforms for targeted marketing and formulating sales

strategy of the particular area. Machine learning is an application of AI that can be used to

analyze consumer data to detect their shopping patterns. Thus best pieces are sent to the best

group helping in the targeted marketing. Thus AI, IoT, social media platforms, modern

transaction methods, smart inventory systems, etc. are some of the technological advancements

along with better and faster gadgets and internet services that has made the future of ecommerce

platforms further bright.

vi. Ecommerce Growth Worldwide

With the advent of latest technology, the problems associated with ecommerce platforms are

majorly resolved that has increased the growth worldwide. The alleviation of the loopholes from

the transaction systems has increased the confidence of the users in ecommerce platforms. The

AI driven platforms have the ability to analyze the fraudulent transactions (Einav et al., 2014).
Fraudulent transactions have imposed a negative image of various ecommerce platforms in the

past that impacted the sales and confidence of the consumers in these platforms. The ability of

the modern ecommerce platforms to deal with these issues has helped them to enhance the

experience of the consumers using the platforms. Similarly, the real time chatbot support has

alleviated the complexities and problems associated with the ecommerce platforms. Chatbot has

increased the efficiency of 24/7 customer support system and international shipping queries. The

consumers paying a huge sum for the commodities are not impressed if they are unaware of the

real-time location of their consignment, so it is necessary that a chatbot support would help the

consumers track their products to enhance their overall satisfaction level with the particular

ecommerce platform (Einav et al., 2014).

The below graph depicts the sales made on the ecommerce platforms worldwide from 2014 to

projected sales of 2023:

Figure: Sales on the ecommerce platforms (Past, present and future) (Statista, 2020)
The graph illustrates a major increase in the sales made on the ecommerce platforms during this

period. Starting from USD 1336 in 2014 to USD 3534 billion dollars, the ecommerce industry

has seen a huge bloom and this bloom is majorly due to the technological advancements and

more secure ecommerce platforms. But this is just the start as the sales are projected to hike up to

USD 6542 billion dollars by 2023. This illustrates a major spike in the ecommerce business

depicting a bright future of these platforms. Online shopping has become a major trend across

the globe due to the added convenience and offers introduced by the ecommerce platforms (Bai

et al., 2020). The consumers are attracted towards the discounted rate, high-quality products and

convenience of shopping by sitting in their home.

1. COVID-19 and Ecommerce Sales

The year 2020 saw the worst pandemic in the form of COVID-19 that forced the governments to

impose lockdown in many countries across the globe. This was a clear sign that physical

shopping would not be allowed and the consumers were focused on stocking the health and

hygiene related products such as toilet papers, sanitizers, etc. (Bai et al., 2020). This was a

golden opportunity for the ecommerce platforms to provide these commodities to the consumers

and enhance their experience using these platforms. Thus, many ecommerce platforms made

deals with the third party vendors supplying these products in bulk to the consumers. This

enhanced the experience of the consumers in demand of these products. During the pandemic the

ecommerce sector saw a growth of 27.6% as compared to the last year with sales reaching over

USD 4000 billion in 2021. Travel bans and retail closure were the major factors behind the

bloom of ecommerce industry (Bai et al., 2020). The supply of masks, and other hygiene

products increased the sales of different ecommerce platforms in the time of pandemic.
In addition to the physical products, the digital products were also offered by these ecommerce

platforms. Songs, movies, software, etc. are the major digital products that could be directly

consumed after being downloaded by the consumers. Adoption of strategies such as B2C and

B2B by the ecommerce platforms have also played a major role in the progress of ecommerce

platforms across the globe.

2. Chinese Ecommerce Platforms

If the Chinese situation is to be analyzed, it can be seen that the foreign products were most

sought by the Chinese shoppers (Kaplan, 2021). Despite the pandemic situation, the sales of

luxury products saw a major hike and the Chinese ecommerce market is projected to become the

largest market in terms of luxury apparel sales by 2025 (Rosillo-Díaz et al., 2019). The

flourishing middle class sector has a great appetite for the luxury products that is increase the

ecommerce sales in China.

Figure: Comparison of ecommerce sales in China, US and EU in 2020 (Rosillo-Díaz et al., 2019)
The above graph illustrates that Chinese consumers have spent around USD 862.6 billion in

contrary to US spending of USD 360 billion and EU spending of USD 352 billion. Alibaba, Tao

Bao and Tmall are subsidiaries that are propelling the Chinese ecommerce platforms (Rosillo-

Díaz et al., 2019). The new competitors such as JD.com and Pinduoduo are the new options for

Chinese ecommerce customers. It is estimated that all Alibaba marketplaces plus JD.com and

Pinduoduo will constitute around 84% of the ecommerce platform sales worldwide. Currently

around 67% of the ecommerce consumers in the Chinese ecommerce platforms range between

the ages of 18 to 44. While, the most popular products amongst the Chinese ecommerce

platforms are apparels, toys, hobby items, etc. (Rosillo-Díaz et al., 2019).

Even during the time of pandemic, when the US and British ecommerce platforms have depicted

economic stagnation, the Chinese ecommerce platforms started improving after April, 2020 and

offered a vibrant ecommerce market.

3. Chinese Cross-Border Ecommerce

China has cemented its position in the cross-border ecommerce and international markets. Even

with ample choices of domestic brands, the Chinese consumers are inclined towards the

international brands that has increased the product portfolio for the Chinese ecommerce

platforms (Kaplan, 2021). The RetailX’s Chinese ecommerce product has reported that China

has experience a growth of 16.7% in cross-border ecommerce and this growth will grow to 25%

by 2021 (Bai et al., 2020), (RetailX, 2020). The shopping patterns of Chinese consumers during

the pandemic has also illustrated that they are preferring the international products and brands

when it comes to ecommerce. Even though China has an established domestic ecommerce

market in the form of Tmall. Another survey conducted by RetailX has depicted that 68% of the

Chinese consumers are happy with the quality of imported products and thus prefer imported
products over the local products (RetailX, 2020). Luxury apparel brands and makeup products

account for the bulk of these cross-border sales (Bai et al., 2020). Notable brands in China

include Calvin Klein, Hugo Boss, Zara, Levis, Gucci, etc. that are now available in China

through different ecommerce retailers.

The major reason for an increase in Chinese cross-border ecommerce is due to

governmental interest and policies regarding ecommerce. Chinese government has

recognized ecommerce as a strong force that can further bolster the slowly rising economy

of China. The local regulations and taxation rules have given a green chit to the cross-

border ecommerce retailers (Bai et al., 2020). These retailers are not operating in China

under the Chinese regulations that has alleviated legal complexities of operating in China.

The role of WTO is also important to enhance the cross-border ecommerce in the country

that is flourishing at an astounding rate benefiting the consumers as well as the retailers

dealing in cross-border products (Bai et al., 2020).

Research Gap

After the critical analysis of the literature review, it can be seen that the former authors have

analyzed some important points regarding the ecommerce platforms in China and all around the

globe. Technological advancements and easy access to technological devices was the major

reason of the recent up rise of different ecommerce platforms. Particularly talking about the

Chinese governmental policies, it can be seen that the taxation policies and other rules helped the

Chinese ecommerce companies to increase their outreach and increase their operation. But there

are certain gaps in the current research as they have not provided any quantitative data regarding

the Chinese ecommerce users. Different authors have focused on the past, present or future of the

ecommerce platforms, but none of the author has connected this past and present of ecommerce
platforms with customer satisfaction or their needs. The primary analysis will be thus more

focused on the ecommerce consumers, their demographic factors and their thoughts about the

ecommerce platforms in terms of satisfaction level, role of technology and the reason for the

usage of ecommerce platforms by the Chinese users.

Although, the Chinese ecommerce platforms have improved substantially yet the researchers

have unable to relate the needs of Chinese commodity market with the ecommerce platforms and

analyze the patterns of the consumers in terms of usage of ecommerce platforms. This research

will be focused on narrowing this gap with the help of primary research. The respondents

would be interviewed and the consumer satisfaction, and other factors increasing the

ecommerce usage would be analyzed and the research hypothesis will be validated.
 Chapter 3: Methodology

Introduction

The shopping pattern of the Chinese have changed substantially after the advent of internet and

ecommerce services in the country. The services such as Alibaba, Tmall, Tao Bao, etc. have

made it easier for the consumers to shop online as these websites not only provide up to date

information about the product but the consumer reviews also make it easier to purchase the

products from these websites. These platforms use the latest technologies of AI, IoT, etc. to

collect the information about consumer’s shopping pattern and recommend particular products to

the consumers that increases their shopping experience. The purpose of the study is to collect

information about the past, present and future of Chinese commodity market of ecommerce. The

commodity market of ecommerce has increased in the recent times due to certain technological

advancements and the introduction of new players in the ecommerce markets, and this research

is focused on the analysis of these markets. The previous chapter was merely a background and

literature review of these topic including the role of governmental policies, history of

ecommerce, advent of new payment systems, role of recent technology and the situation of

commodity market of ecommerce worldwide. This chapter is focused on the research

methodology that would be used for the analysis of this topic. Along with research design, this

chapter would also focus on the participants of the research, data collection strategies, limitations

and ethical considerations of the research methodology.

Research Design

Research design comprises of the suitable framework adopted for the collection of data regarding

the research topic. This framework is not only responsible for the collection of data but also for

interpreting the data to devise useful results. For this research, both primary and secondary data
is analyzed to devise useful interpretations regarding the research topic. The qualitative data is

mostly collected through the secondary research, where the authentic research articles, research

journals, websites, fiscal reports, etc. are studied to extract useful qualitative data. This data is

useful because it depicts the past, current and future trends in the Chinese ecommerce markets.

In addition to this, the role of governmental policies, comparison of policies in the present and

past, flow of internet, and role of technology is analyzed.

While the primary research would be used to collect the quantitative data that would be used for

further analysis. Quantitative data would mostly tell about the satisfaction rate of the consumers

using ecommerce platforms, proportion of consumers using ecommerce platforms, device used

by the consumers while assessing these platforms, education level, age group, gender, etc. are

some useful quantitative information that would be obtained by quantitative research. Both

demographic and other quantitative data is important in context of this research as more

information would help to cover the research gaps identified in the secondary analysis.

Justification of Research Design

The usage of both primary and secondary data increases the range of results regarding the

research topic. The Chinese commodity market of ecommerce is a wide topic and different

researchers have already conducted research on this topic and came up with some useful results.

But the openness of the topic depicts that there is always a research gap that is not fulfilled by

the prior authors and primary research should be conducted to fulfill this research gap. The

research topic is quite straight forward that is the analysis of past, present and future of the

Chinese commodity market of ecommerce, and ample data can be collected from the secondary

resources to conduct the research. But the main aim of this research is to analyze this topic in a
critical manner, so the research gap would be identified in the secondary research and

quantitative data would be used to fulfill that research gap.

So both quantitative (primary data) and qualitative (secondary data) would be collected to

conduct an in-depth research on the commodity market of ecommerce. Ecommerce is a popular

field in China and around 80% of the population has used some ecommerce platforms in the

country, so it makes it easier for us to select the research participants and conduct a research

analysis. Moreover, the authentic secondary data is also available in form of research articles,

research journals, authentic websites, etc. that makes it easy to collect data and analyze both

form of data to make useful interpretations.

Description of the Participants

The participants chosen for this research are individuals of different age groups and different

genders who have used any ecommerce platform in China. These participants would belong to

universities, high-schools, offices, and businessmen using ecommerce platforms to order

different commodities. Etikan and Balla, (2017) reported that the quantitative analysis is used to

generalize the data regarding wider populations. This analysis is performed to analyze the trends

and making predictions along with testing the casual relationship. In our research, the

quantitative data is also used to find out the trend regarding the ecommerce users, their

demographic properties and other factors involving the ecommerce experience. The participants

would not be forced to participate in this research but the consent forms would be distributed

amongst the sample population and the participants agreeing to participate in this research would

be given the survey questionnaires and rest of the sample population would not be added in this

research (Etikan & Bala, 2017).

Sampling Method

Sampling method is particularly useful in the analysis of the results and authenticity of the

results. Sampling methods helps in analyzing the characteristics of research population that is

major in the interpretation of results. As described above that the participants would be

belonging to high-schools, universities and offices so collecting data from such huge population

sample is a difficult task. So, probability sample method is used for sampling the data. This

would provide equal opportunity to every individual to become a research participant.

Probability sampling method provides equal opportunity to every individual that increases the

authenticity of the research. It is to be noted that sample is the proportion of population that is

selected to determine the characteristics of the entire population.

The research population in our case are the students of universities, high-school and employees

working in the office. For our convenience, Shanghai University, Shanghai Community National

School and an IT office nearby this university and high-school is our population. Furthermore,

stratified sampling method would be used that will divide our population according the gender

and equal data would be collected from both female and males. The population would be divided

in male and female groups and random sampling would be conducted that would provide equal

chance to both male and female members to participate in the research.

Sample Size

The sample size is around 100 participants who would comprise of high-school students,

teachers, cleric staff, university students, and employees from the nearby IT firm. These

participants will be selected randomly that is there is no specific criteria of selection of

participants from these three locations (high-school, university, and IT firm). The stratified

random sampling would be used to divide the population in male and female so both genders
equally participate in this research. 100 participant is a decent sample size that can give an

insight into a particular situation and this sample size would be enough to get an insight into the

Chinese commodity market of ecommerce. Different demographic factors such as age, income

level education level, occupation, etc. will be helpful in analyzing different consumers and

getting a generalized overview.

Questionnaire

Questionnaire is the major tool that would be used for quantitative analysis. The questionnaire

would be divided in three parts that would include a total of 15 questions. These three parts

would be 1) satisfaction level of using ecommerce platforms 2) role of technology in using

ecommerce platforms 3) purpose of using ecommerce platforms. In addition to this, the

demographic information such as gender, age, income-level, education-level would also be

useful in the collection of data regarding the Chinese commodity market of ecommerce. The

questions would be kept simple to alleviate any confusion. Furthermore, the questionnaire would

be distributed amongst the sample group using electronic mail and printed questionnaire. The

printed questionnaire would be distributed and collected by an acquaintance working as a lab

engineer in Shanghai Community National School. While the participants from the IT office and

Shanghai University would be distributed the questionnaire through electronic mail. Both

consent form and survey questionnaires would be distributed via electronic mail system.

Quantitative Data Analysis

Questionnaire data analysis is an important part of research that indicates the authenticity

of the results and research quality. Different statistical tools are available for the

quantitative data analysis and we have chosen the Likert scale for the analysis of the data.

Likert scale is most widely used scale to make quantitative data interpretations. In this
research arbitrary score would be given to different options. A score of 5 would be given to

options such as very satisfied, always, etc. and a score of 1 would be given to very

unsatisfied, never, etc. There are a total of 15 questions so the highest questionnaire score

would be 75 and lowest questionnaire score would be 15. If the score is divided in different

sections, then the highest score of each section is 25 and lowest score would be 5.

Ethical Considerations

There are certain ethical considerations while conducting a primary research. It is to be made

sure that the ethical considerations are addressed properly to make the research a worry free

process. The biggest ethical consideration in primary research is the protection of the participant

demographic data and the research data itself (Etikan & Bala, 2017). This information is critical

and can be used for different purposes by the organizations. There are also some cases where the

participants faced troubles for participating in the research, so it is an ethical consideration to

prevent the leakage of participant data. For this purpose, our research would not note the proper

name of the participant, and the participant would be called by the participant number. It would

be made sure that the demographic information is not shared with any public company or

organization at any cost and this information should be kept highly classified.

Secondly, it would be made sure that the participants are not forced to participate in the research.

A consent form would be distributed prior to the research that would comprise of the terms and

conditions of participating in the research. These terms and conditions would be the constraints

of participating in this research so the participants are aware of the consequences. Survey

questionnaire would only be distributed amongst the participants who would fill the consent

form and agree to participate in the research. The other participants would not be given the
questionnaire and would not be forced by any mean to participate in the research. The consent

form is given in the appendix section.

 Chapter 4: Findings

This chapter will focus on the findings of the primary research and will analyze the key points in

this research:

Demographics

This subsection will discuss the demographic results of this research starting from age to income

group, education level and age level. The participants selected for this research are belonging to

a high-school, university, and a nearby IT office.

i. Gender

The graph in the appendix section illustrates that the participants were equally divided on the

basis of their gender. There are equal number of male and female participants in this research.

Around 100 participants took part in this research out of which 50% (50 participants) were male

and 50% (50 participants) were female. This gave an equal opinion of both male and females

regarding the ecommerce platforms in China making the results more authentic. The stratified

sampling method was helpful in dividing the population in male and female clusters. After the

division of population in male and female random sampling method was used to constitute the

sample. It can be possible that the reason for usage of Chinese ecommerce platforms and usage

experience might vary from gender to gender, so it was decided that equal responses from males

and females will be collected to alleviate any biasness from the research results.

ii. Age Group

Age group is another important factor when it comes to the ecommerce users in China. The

secondary research above illustrated that the majority of ecommerce users in China are lying in

the age group of 14 to 44. So it was necessary to include this element in our research. Although,
it is evident from the research sample group that the age group would be either below 20 for the

high-school students and the highest age group would be around 60 that is the maximum age for

working in private Chinese firms. So, the options in the questionnaire also ranged from below 20

to the highest option of 50-60. The graph in the appendix section illustrated that major age group

in this research was between the ages of 20-30 and 31-40. Around 35% of the participants were

between the ages of 20-30 and 25% of the participants were between the ages of 31-40. The

participants between the ages of 40-49 also constituted 25% of the total research population. The

least proportion of participant was lying below the age of 20. Only 5% of the participants were

below the age of 20 and around 10% of participants were lying between the age group of 50 to

60. Thus this research has provided the opinion of a wide age group regarding the ecommerce

platforms. The Chinese ecommerce platforms are much popular among all age groups and it is

interesting to know the opinion of different age groups regarding role of technology, satisfaction

level using ecommerce platforms and purpose of using ecommerce platforms.

iii. Education Level

Education level is another important demographic factor as education refines the thought process

of the individuals and their insight into the latest technology. So, it is important to analyze the

education level of the participants while researching about the ecommerce platforms in China.

The options of education level ranged between under high-school level to masters level. The

under high-school level option was for the employee working in the IT firm and the remaining

options were for all the participants. The results illustrated that only 5% of the participants were

educated below the high-school level. This was quite a small proportion of participants

illustrating the ecommerce platforms are not that common in low educated individuals. The

participants with high-school level education comprised around 15% participants. Majority
proportion of the participants were studying at the undergraduate level comprising around 45%

of the population. While the participants with master’s degree or higher constituted around 25%

of the research population.

iv. Income Group

Another important demographic factor was the income group of the participants. It is a general

notion that ecommerce users are generally earning a good sum of income. Thus the research

participants belonged to different income groups. The income groups ranged from under 3000

yuan to above 9000 yuan. Thus there is a wide gap between different income groups that

illustrate that the participants had a wide income gap giving a generalized opinion of all the

income groups regarding ecommerce platforms. Around 5% of the participants were earning

below than 3000 yuan. This illustrate the Chinese economy and the skill level of Chinese nation

as the participants also included the undergraduate and high-school students who were earning

above 3000 yuan monthly. 15% of the participants were earning income between the ranges of

3000 yuan to 5000 yuan. Around 25% of the participants were earning between the ranges of

5001-7000 yuan. 45% of the participants were earning between the ranges of 7001-9000 yuan.

While only 10% of the participants were earning above 9000 yuan monthly.

The source of income of these participants were part-time jobs, free-lancing, internships and job

in the IT firm. So, the income levels varied greatly and a generalized opinion about Chinese

ecommerce platforms were recorded.

v. Occupation

Occupation is another important demographic factor. The participants were from high-schools,

universities, and IT firm, so the major occupations would be teachers, clerical staff, students,

senior level employees, part-time employees, and freelancers. Around 25% of the participants
were either students in the high-school or university. 10% of the participants were teachers. The

second major proportion of the participants were senior level employees constituting around 25%

of sample group. 15% of the total participants were free lancers. A minor proportion of the

participants were cleric staff constituting around 5% of the total research population. 10% of the

research participants were doing part-time job in school, university or the IT firm.

Satisfaction Level of the Ecommerce Users

The satisfaction level of the Ecommerce users is an essential factor that determines the

ecommerce platform success. Every ecommerce platform is focused on enhancing the consumer

experience by providing flawless services, wide range of high-quality products, and imported

products to the consumers. These factors enhance the satisfaction level of ecommerce users. The

questionnaire comprised of some basic questions related to the satisfaction level of ecommerce

users in China. The questionnaire results are analyzed by Likert scale with highest score being 5

for answers such as very satisfied and 1 for being very dissatisfied. There were a total of 5

questions in ecommerce satisfaction factor so the highest points would 25 and lowest points

would be 5. The table below illustrates the Likert scores of the responses of high-school students,

university students and IT employees:

Table: Satisfaction Level of Ecommerce Users Score

Types of Number of Mean Standard Maximum Minimum Range

Participants Participants Deviation

High-school 33 18.4 3.3 20 12 8

students

University- 34 20.3 2.16 25 19 6

Students
 IT Firm 33 17.4 2.7 23 16 7
Employees

The results illustrate that the university students were most satisfied with the ecommerce

platforms in China. The least satisfied users were high-school students who were dissatisfied

with the interface of the ecommerce platforms. Majority of the participants were satisfied with

the delivery rate of the products, and some participants even reported that the products reached to

their desired delivery destination within a day or two that depicts that the Chinese ecommerce

platforms have an efficient last mile delivery system. The enhanced security of the platforms also

enhanced the experience level of the users using ecommerce platforms. It is to be seen that the

university students were most satisfied with the ecommerce platforms, because they use

ecommerce platforms more frequently as compared to the office employees and high-school

students. University students mostly order components for different university projects and want

them on an urgent basis, and their Likert scale illustrates that the university students were most

satisfied with the prevailing ecommerce platforms in terms of their performance in delivery time,

product quality and data security.

The IT office employees were also satisfied with the Chinese ecommerce services in terms of

delivery, product quality and security. The office employees mostly order daily day commodities

and house hold good because they cannot shop physically from store due to time constraints and

were mostly satisfied with the Chinese ecommerce platforms. But some office going participants

depicted their dissatisfaction with the Chinese ecommerce platforms and thought, that the

performance of these platforms can be further improved that would enhance the consumer

experience using these platforms. Finally, the high-school students were also satisfied but their
Likert score is considerably less as compared to the other two participants discussed above. This

can be explained in terms of different demands of different age groups from these ecommerce

platforms and their expectations in terms of ecommerce platforms performance.

Technology and Chinese Ecommerce Platforms

Technology is the major factor that has played a major role in the progress of ecommerce

platforms in China and around the globe, and our questionnaire also featured some questions

regarding the role of technology in the up rise of Chinese ecommerce platforms recently. These

questions were related to role of smart mobile phones, role of internet, role of increased security

protocols, and information sharing with the ecommerce platform. Industry 4.0 has allowed the

ecommerce platforms to use the customer information and shopping patterns to target them

individually in a separate and distinct way. This was also asked from the participants that

whether they are aware of the usage their personal information by these ecommerce brands and

the satisfaction level while sharing their information. The responses are quantified using Likert

scale with 5 score being the highest score for the answer (strongly agree) and 1 being the lowest

score for response (strongly disagree). A total of 5 questions were asked in this section, so the

highest score could be 25 while the lowest score could be 5. The Likert scale data is illustrated in

the table below:

Table: Role of IT in Ecommerce Users Score

Types of Number of Mean Standard Maximum Minimum Range

Participants Participants Deviation

High-school 33 21 2.6 24 17 7
students
University- 34 22 1.9 25 19 6
Students

IT Firm 33 16 3.2 19 7 12
Employees

The results illustrate that the university going participants and high-school participants were

aware of the role of IT in the progress of ecommerce platform, while the average Likert score of

16 for office going participants illustrates that these participants were less aware of the role of IT

in the progress of Chinese ecommerce platforms. This is because, the age group of office going

participants ranged from 25-50+ so, there is a difference of technology integration in these

individuals. Furthermore, it can be seen that the office going employees are less aware of

technological developments as compared to the high-school students and university going

students. These participants were also aware of the fact that the ecommerce platforms are using

their information to increase the consumer experience by introducing amazing features on their

platform. Most of the office going participants were unaware of this fact that their information is

used by the ecommerce platforms to shape up their strategy. Around 65% of the office going

participant disagreed with the fact that they are aware of usage of their information by the

ecommerce platforms.

The students are mostly aware of the modern IT applications, and the role of technology in the

up rise of ecommerce platforms and responded in the favor of role of technology in the progress

of Chinese ecommerce platforms. It was also illustrated that the response of both students (high-

school and university going) was more or less similar as depicted by the standard deviations

score, in contrary to the office going participants whose response score depicted variations.
Purpose of Using Ecommerce Platforms

The future of the ecommerce is also dependent upon the purpose for which these ecommerce

platforms are used by the consumers. It is to be noted that all ecommerce platform users do not

use these platforms for buying the products, but some users use these platforms to analyze the

prices, products offered and other purposes. So, it is necessary to know that for what purpose

these ecommerce platforms are used by the consumers. Thus, the final part of the questionnaire

was focused on the purpose for which the consumers are using ecommerce platforms.

The major purpose of platform usage include purchase of local products, purchase of

international products, estimate about the prices of products, get an insight into the in-products in

the market, and to analyze the reviews of different products. In short, the consumers use

ecommerce platforms to buy products and to get an insight into different commodities offered in

the market. Thus, the questionnaire included questions that targeted both functions of ecommerce

platforms. Likert scale was used to quantify the results with a score of 5 for the answers such as

strongly agree and 1 for answer strongly disagree. The Likert score of the participants is shown

in the table below:

Table: Purpose of Usage of Ecommerce Users Score

Types of Number of Mean Standard Maximum Minimum Range

Participants Participants Deviation

High-school 33 14.4 2.9 20 6 14

students

University- 34 16.3 2.6 18 9 9

Students
 IT Firm 33 10.4 4.7 14 7 7
Employees

The above results illustrate that most of the ecommerce users use these platforms for 2 or more

purposes. They also get an overview of the products and some prefer to purchase the products

from online stores rather than the physical stores. The results illustrate that the university level

students use ecommerce platforms for different purposes. The high-school students also use

these platforms for different purposes. But the office going employees use ecommerce platforms

for one or two purposes only. Most of their answers are in the range of strongly disagree yielding

a low Likert score as compared to the other two participants. The response of the office going

participant illustrates that these consumers mostly used ecommerce platforms to order local and

international products. They seldom use ecommerce platforms to get information about different

products in the market, their price range and reviews.

On the other hand, the university level students and high-school students were also using

ecommerce platforms to collect information about product pricing and reviews along with the

purchase of products from these platforms.

 Chapter 5: Results and Recommendations

The above conducted survey illustrates a significantly higher satisfaction level of the consumers

when it comes to the Chinese ecommerce platforms and their offerings. The consumers were

satisfied with the delivery rate, product quality, security protocols and the interface of these

ecommerce platforms. In addition to this, the young consumers were aware of the role of

technology in success of ecommerce industry and the way their information is used with their

consent for the improvement of the ecommerce services. While the age group of the office going

participants ranged between 25 to 60, so there were varied results depicted by these participants

in terms of knowledge about the usage of information by these platforms and the role of

technology. Finally, the purpose of usage of ecommerce platforms also depicted a variation due

to difference in the age group of the participants. Mostly, the consumers in China are using

ecommerce platforms to purchase local and international products, but the young consumers are

also using ecommerce platforms to get an insight into different products offered in the market.

Thus, the hypothesis 1 that commodity market of ecommerce is going to increase in China is

valid, as the consumers are majorly satisfied with the ecommerce services provided by these

platforms are confident to share their information with these platforms. The information can be

used by the Chinese ecommerce platforms to analyze the customer behavior and target them in a

better manner. The necessary changes will also be implemented in the platforms that would

attract more consumers in China increasing the commodity market. The literature review also

illustrates that the Chinese commodity market of ecommerce is also going to rise due to the

governmental policies and the rapid integration of latest technology in the ecommerce sector.

SEO and PPC also played a huge role in landing the consumers on the home page of different

Chinese ecommerce platforms. Along with this, the technological integration in inventory
management, delivery system and promotion has been major throughout these years that has

increased the scope and size of commodity market of ecommerce platforms in C

Currently, the pandemic situation has played a major role in the rise of ecommerce industry

around the globe including the Chinese commodity market. The literature review illustrates that

the Chinese ecommerce platforms were successful in meeting the requirements of the Chinese

consumers during the pandemic that also enhanced their confidence in these ecommerce

platforms.
The cross-border partnership between Chinese platforms and the international brands has

increased the opportunities and product portfolio for the consumers. The consumers are now able

to order international commodities using Chinese ecommerce platforms that has also enhanced

their confidence and satisfaction level using these platforms. The survey results have resonated

with the findings in the literature review and has approved both hypothesis proposed in the above

section. The Chinese ecommerce commodity market of ecommerce is not only supposed to grow

in the future but the satisfaction level of the consumers of Chinese ecommerce platforms is also

enhancing that depicts the enhanced and improved performance of different ecommerce

platforms in China.

Recommendations

Following are a few recommendations made to the Chinese ecommerce platforms that would

further improve the ecommerce industry in the country:

i. Use Brilliant Product Description

The survey results illustrated that the young ecommerce users are also using ecommerce

platforms to get an insight into new products offered in terms of their features. So, it is

recommended to the ecommerce platforms to use brilliant product description that would

increase the user experience. Not only should the ecommerce platforms depict the company

displayed information of different products, but should also publish honest customer reviews. In

addition to this, the ecommerce platforms should also use high-quality images to depict the

slightest details of the product to increase user-experience. This would allow the consumer in

effective purchase decision as they will know the shortcomings and the experience of other users

using similar products.

 ii. Stop Forcing the Users to Register Before Buying

Although, most of the ecommerce platforms in China do not force the user to register and sign up

before buying a product. But some ecommerce platforms do not allow the users to browse the

products or blur major information of the products to force the users to sign up and register

themselves on ecommerce platforms. This not only impart a negative image of the ecommerce

industry but also impacts the reputation of the ecommerce platform itself. So, it is recommended

to the new ecommerce platforms to stop forcing the users to register before buying the product.

Alibaba is the leading ecommerce platform in the country, and its interface and website

properties is a guidance for all in terms of design of ecommerce platforms.

iii. Consensual Usage of User Information

The survey results also depicted the youth was aware of usage of information by Chinese

ecommerce platforms, but the elders and mid-aged consumers were unaware of the fact that their

personal information is used by these platforms for experience enhancement. The ecommerce

platforms ask for the usage of cookies from the customers if they are using the web services and

the usage of certain information in case of mobile application usage. But there must be a clear

mention of the information usage instead of hiding it in long terms and conditions that are not

mostly read carefully by the consumers. Although, the security protocols of ecommerce

platforms have increased in China that has made it difficult for the hackers to use and sell the

consumer information. Yet, it is suitable for these platforms to clearly inform the users that their

particular information is used by them to enhance their experience and inform them about the

new products according to their search and purchase pattern.

 iv. Improved Last Mile Delivery System

The ecommerce platforms should focus on delivering the products to the consumers as earliest as

possible. This can be done by making deals with the delivery services in the company or

establishing a private logistics network that would supply the ordered products to the consumers.

But there must be an integration of latest technology such as inventory management system,

modern warehousing tools, different transportation options that would decrease the product

delivery time. The last mile delivery system of Amazon is a leading example that has not only

integrated latest technology in the delivery system but also established warehouses in the suburbs

of major cities that has helped in alleviating the extra time required for the delivery of different

products.

v. Real Time Tracking Option

The ecommerce consumers are concerned about the safety of the ordered products and want to

track their location during delivery. The last delivery of different ecommerce platforms provide

an option of tracking of products, but there are very less brands that are providing an option of

real time tracking option. Real time tracking allows the consumers to track their products in

terms of the real-time location of the products. This would increase the trust of the consumers on

the ecommerce platforms and enhance their experience of using these platforms.
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Appendix

Questionnaire

Demographics

1. What is your gender?

a) Male

b) Female

2. What is your age?

a) Below 20

b) 20-29

c) 30-39

d) 40-49

e) 50-60

3. What is your education level?

a) Under high-school

b) High-school

c) Undergraduate

d) Masters or Higher

4. What is your monthly income range?

a) Under 3000

b) 3000-5000

c) 5000-7000

d) 7000-9000

e) More than 9000

 5. What is your occupation?

a) Teacher

b) Cleric Staff

c) Student

d) Senior-Level Employee

e) Part-time employee

f) Freelancer

SD= strongly disagree VD= Very dissatisfied

D= Disagree D= dissatisfied

U= Undecided U=Undecided

A= Agreed S= Satisfied

SA= Strongly Agreed VS= Very Satisfied

Section A: Satisfaction level of using Chinese VD D NS S VS

ecommerce platforms
1. I am happy with the interface of the Chinese
ecommerce platforms.
2. I am satisfied with the ecommerce platform
performance.
3. I am happy with the security of the ecommerce
platforms
4. I am satisfied with the product quality delivered by
the ecommerce platforms
5. I am satisfied with the product delivery rate
Section B: Role of technology in up rise of Chinese SD D U A SA
ecommerce platforms
6. The latest mobile phones have played a huge role in
ecommerce success
7. I feel that fast internet has played a major role in
the success of ecommerce platforms
8. I feel that the increased internet security protocols
have made ecommerce successful in China
9. I feel satisfied sharing personal information with
the ecommerce platforms
10. I am aware how the information of users is
collected and used by the ecommerce platforms

Section C: Purpose of using Ecommerce platforms SD D U A SA

11. I use ecommerce platforms to buy local
products
12. It use ecommerce platforms to buy
international products.
13. I mostly use ecommerce platforms to get an
estimate about product prices
14. I use ecommerce platforms to analyze the
product reviews and then purchase products from
physical stores
15. I use ecommerce platforms to get a know how
about the common products in the market
Findings

Demographics

i. Gender

ii. Age Group

iii. Education Level

iv. Income Level

v. Occupation Level