Locale e-shoppers lead the way despite lower incomes

By Michelle Yeomans

- Last updated on GMT

Locale e-shoppers lead the way despite lower incomes
Online retailer Taobao has started to see an uptake in consumers from smaller locales in China investing in the online forum to buy cosmetics, particularly in 2012 where they were found to buy more products over their urban counterparts.

According to that report, consumers from the townships spent an average of 5,628 yuan ($910.7) last year on cosmetics, almost 1,000 more than urban consumers.

Locale consumers placed an average of 54 orders each on Taobao in 2012, far more than the 39 orders placed by e-shoppers living in China's first- and second-tier cities.”

Out-buying despite lower incomes

Although residents' incomes tend to be lower in small towns and counties, their online spending habits are similar to those of urban residents, and that for every 100 yuan spent online, 57 yuan is spent by people in third- and fourth-tier cities, greater than the national average of 39 yuan.

Topping the Taobao ranking in terms of the richest county was Yiwu, also ranked by Forbes as the richest county in China, with online spending totaling 3.4 billion yuan.

Residents in Qingliu county in southeast China's Fujian province spent a staggering 20,151 yuan, or 72.55 percent of their combined income, on online shopping while in first-tier cities such as Beijing, Shanghai, Guangzhou and Shenzhen, the ratio has yet to exceed 27 percent.

The report also showed that 22 percent of Taobao customers in small towns used its mobile application to shop online. But the percentage declined to 17 percent in first- and second-tier cities.

In terms of the most popular brands, the online retailer says major international players like Estee Lauder have sold well in counties and townships with consumers spending an average of 765 yuan a piece, slightly more than the 652 yuan spent by first- and second-tier city residents.

Chinese online market becomes largest in the world

With record numbers of China consumers taking to the internet to make purchases, online beauty purchases have grown by a record 200 percent since 2006 to become the largest market in the world, according to Kline Group.

The market was valued at $8bn in 2012, and as yet more consumers are added to the swelling number of online purchases in the country, the market is set for further rapid growth in the coming years.

Karen Doskow, Kline industry manager, says the latest figures mean that the market for online beauty in China alone puts it almost on a par with the entire beauty market in France, the country that is already the largest market for beauty in Western Europe and are almost nine times the size of internet beauty sales in the US, a market where the take-up on internet purchases has been relatively high.

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