Two years ago, Li Yuhua's daughter taught her how to shop online. Since then, the 51-year-old farmer in Wushan has been a regular online shopper. Shoppers like Li Yuhua are the new target for China's ecommerce giants, including Alibaba Group, which operates the Taobao platform, and JD.com. Rural China added 3 million more Internet users in the first half, taking the total number to 225 million, or 26.3%, of the country's total Internet population of 854 million, according to a report on rural ecommerce development released last week by the China International Electronic Commerce Center. That helped improve rural online sales in the first half of the year by 21% to 777.1 billion yuan (US$109.6 billion), outpacing the national growth rate by 3.2 percentage points.
"However, it is a little bit early to say that China's ecommerce battlefield is moving to rural China," said Chen Tao, a senior analyst at consultancy Analysys. Unlike urban residents, most rural Chinese haven't experienced ecommerce shopping. While that provides online platforms with one of the last undeveloped markets for ecommerce, progress has been slow due to the lack of infrastructure (基础设施) and logistics (物流) support.
To address that problem, China's second-largest ecommerce operator, JD.com hired more deliverymen and tested drone (无人机) delivery services to improve service in rural China. Alibaba Group, China's largest ecommerce player, announced in April last year that it had invested US$717 million in Huitongda Network Co., which helps to boost sales in 15,000 towns across 18 provinces.
Another inhibiting factor in the development of rural ecommerce is the income gap. In 2018, annual per capita disposable income (人均可支配收入) in rural areas was 14,600 yuan (US$2,065) compared with 39,300 yuan (US$5,559) in cities. "Lower disposable incomes in rural areas limit the consumption," said analyst Chen. "It also takes time to educate rural residents to accept ecommerce services as most of them are new to online. There is still a long way to go to popularize online shopping in rural China."
