Jumei sees slump in orders despite Q4 tipped to be the strongest..

By Michelle Yeomans

- Last updated on GMT

Jumei sees slump in orders despite Q4 tipped to be the strongest..

Related tags Online shopping

The fourth quarter is reported to be the strongest for China’s online retailers, thanks to shopping holidays like Singles' Day. However, Jumei seen a decrease in total orders in 2014 by 5.9% to 9.6 million. 

According to tradingfloor.com, retailers should see strong customer and order growth in Q4 because of the likes of good discounts, however the publication reported Jumei to have under-performed.

"Revenues and earnings both missed analysts’ consensus, but curiously strong revenue guidance for the first quarter saw the share price rally 6.3% after hours trading, and close up 7.72​," the website wrote.

Apparently Jumei has been fighting off competition from VIPshop for its' reputation as China's leading online cosmetics retailer.

The beauty retailer's full year results were more positive; total orders grew 18.3% to 42.6 million overall, while active customers grew by 26.7% to 13.3 million.

Popularity of e-commerce in Asia

E-commerce is becoming an increasingly important trend throughout the world, but nowhere more than in the Asia-Pacific region with its fast-growing base of internet users and enormous population.

Studies reveal that e-commerce in Asia will soon be a bigger business than in the Western world, with Forrester Research, a global market researcher predicting that combined internet sales from the region will reach $768bn by 2017, making them bigger than those in Europe and North America combined.

The boom is increasingly being driven by China, as Laurie Du, a Mintel beauty analyst, recently told CosmeticsDesign-Asia.com that innovative digital marketing will now be a requirement for companies to take advantage of the countries’ “fragmented” ​use of traditional media and growing internet use.

China’s top site for online makeup is Jumei, an e-commerce behemoth which has mushroomed since its founding in 2012. The firm is now on track to earn a profit of $100m off sales of $1-1.6bn in 2013.

Online sales allows trade to easily cross international boundaries

E-commerce also allows trade to easily cross international boundaries.

SK is a trend setter for Asia-Pacific and increasingly, the rest of the world, with cosmetics, fashion and music from the country becoming highly popular in overseas market- as evidenced by the runaway success of artist Psy in the West.

Chinese online consumers are increasingly eager to purchase Korean cosmetics, with tie-ins with K-pop bands being used as marketing tools by brands such as Nature Republic.

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