Industry Analysis Case Study

Case Title:

Emergence of China in the Global E-Commerce Market (A): Dragon Drags on Adaptation

Abstract:
One of the most popular economic stories in the last decade and half was the emergence of China as a formidable force in the global economy. With the growth booming at more than 10% per annum, all sectors of the Chinese economy got the required thrust, E-commerce being one of them. Internet penetration in the country registered dramatic surge, as the Chinese establishment eased regulations and foreign multinationals provided the required know-how along with necessary hardware. Once the infrastructure was in place, the Chinese business community was quick in embracing E-commerce. However, the common populace was not quick enough, being pulled back by many apprehensions – chief among them were lack of physical feel of the products and security (over privacy and payments) – ultimately E-commerce has not gained expected popularity. Albeit slowly, number of people purchasing online is picking up – much to the liking of Chinese e-commerce companies. This case study, the first in the two case series, enables a discussion on why e-commerce failed to attract Chinese public, though it had all the necessary ingredients. Why was Chinese public averse to online transactions? What strategies did the companies adopt to increase the popularity of E-commerce? How China was able to establish itself on global E-commerce market place?

Pedagogical Objectives:
The case study is meant to understand the importance of electronic form of business and how it has changed the meaning of business over the decade. Specifically it can be used to:

• To understand the difference between Internet economy, electronic business and electronic commerce
• To discuss the significance of digital economy vis-à-vis traditional economy
• To understand the constituents of e-commerce business
• To analyse the critical success factors for the growth of e-commerce
• To debate the relevance of e-commerce business in China
• To understand the resulting business opportunities and challenges.

Keywords :  E-commerce; Dynamics of online business; Industry Analysis Case Study; Electronic global marketplace; Internet commerce; Chinese electronic commerce; China in global e-eommerce; Digital economy; Critical success factors of e-commerce; Opportunities and challenges of e-commerce; Internet economy; Old economy and New Economy