China is experiencing an explosion in credit card ownership, with the number almost doubling in first quarter 2008 from a year ago, according to the People’s Bank of China.
The number of credit cards in circulation surged 92.9% over last year to 104.73 million as of end-March, the central bank said. There were 1.58 billion bank cards, including debit and credit cards, which is an increase of 29.1% over 2007, and this is helping to kickstart China’s nascent online shopping market.
Taobao is the country’s dominant etailer with an online shopping penetration rate of 81.5%. The Top 5 internet retail sites in China (according to a survey by the China Internet Network Information Center, CNNIC) are as follows:-
1. Taobao.com (subsidiary of Alibaba.com)
2. Danddang.com
3. Joyo.com (China subsidiary of Amazon)
4. Eachnet.com
5. Paipai.com
Even the legendary master “Shifu” of kung fu practitioners – China’s revered Shaolin Temple, has recently kick-started its online foray by setting up an eshop on Taoboa. The popular Chinese C2C site is often compared to eBay Inc. except that the former does not charge any transaction fees to either buyer or seller.
Taobao’s customers increased to 62 million from 53 million in the first quarter of 2008 and its transaction volume hit 18.8 billion yuan, up 170% from the corresponding period in 2007. The company expects 2008 transaction volume to increase 130% from the previous year and exceed 100 billion yuan (14.4 billion USD).
Started up in 2003, Taobao is a subsidiary of the Alibaba group. The parent company has launched Alimama.com, an online advertising service for small-to-medium-sized websites, that is aiming to grab maximum market share in China within 3-5 years. Total online advertising in China is expected to reach 12.2 billion yuan (US$1.76 billion) in 2008, growing 58.5% from last year, according to the Data Center of the China Internet.
B2B portal Alibaba.com – in which Yahoo invested 1 billion US dollars in 2005, was founded by famous Chinese entrepreneur Jack Ma (“How I Did It: The Unlikely Rise of China’s Hottest Internet Tycoon“, Inc.com) and enjoyed a very successful listing on the Hong Kong stock exchange last year.
