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Predictions for Portugal-China Cross-Border Trade in 2023

Predictions for Portugal-China Cross-Border Trade in 2023 -
Predictions for Portugal-China Cross-Border Trade in 2023 - Portugal Business News

The predictions for Portugal-China Cross-Border Trade in 2023 according to Alvin Liu, President of Alibaba’s B2C Retail Business Group, take into account what China’s reopening means for cross-border retail.

Mr. Liu believes that brands should tell their stories to the Chinese market and cites the example of centuries-old wineries in Portugal’s Porto region that are mostly unknown in China. He underlines that, “because China’s population is enormous, even brands that serve a small category overseas have a potentially huge market here.”

Mr. Liu predicts that EU-China Cross-Border Trade will increase in 2023 through the use of new technologies that offer more immersive shopping experiences. He explains that “for example, we are talking with a makeup company that wants to use augmented reality to allow customers to see their products. We can also work with partners selling products from shoes to watches to improve customer experience.”

According to Mr. Liu, Alibaba “will definitely take advantage of livestreaming and short videos to help European brands with their content marketing.”

Other opportunities that will increase cross-border trade include the Tmall Luxury Pavilion which works with the world’s largest luxury houses, such as British fashion house Burberry that leveraged its data to create a private digital salon focused on luxury coats.

Although Chinese consumers could play a vital role in helping international brands weather a challenging 2023, winning them over is becoming harder as many Chinese companies can now offer products that are as good as or sometimes better than foreign ones, at a more competitive price. They are also generally better acquainted with their customers and are often able to react faster to trends in order to make bolder investments.

Mr. Liu predicts that, in 2023, global brands with strong Green credentials will do especially well, as will those that can offer a lifestyle upgrade.

With China’s reopening, more brands will target Chinese tourists and retaining clients once they return home will be key. Mr. Liu predicts that the return of quarantine-free travel from Jan. 8th will give Chinese travelers a chance to discover a smorgasbord of overseas brands.

“When China reopens, Chinese tourists will be back in Europe and they will be exploring more local products,” says Alibaba’s President of B2C Retail Business.

Before the pandemic abruptly cut off international travel, Chinese departures topped 154.6 million in 2019, up from 10.5 million in 2000 according to the World Bank as China’s wealthy middle class expanded its horizons.

With Chinese borders re-opening, the money at stake for B2C Retail Business is substantial. The value of Chinese outbound tourism spending on shopping in 2019 was $54.7 billion, according to Euromonitor International, a market research provider. As Chinese tourists return, merchants are exploring how to best meld shoppers’ experience from brick-and-mortar stores to buying digitally and some are turning to the metaverse.

“We are working with our partners to develop a new kind of customer journey that is both online and offline,” said Mr. Liu, whose portfolio of businesses at Alibaba includes Tmall Global, China’s largest cross-border online marketplace, where retailers without operations in China can build virtual storefronts and ship products into China.

Consumer brands have reason to be optimistic as the demand for international products in the vast Chinese market has continued to grow throughout the pandemic, even with China’s borders virtually closed. Imports of consumer goods rose nearly 19% to $248 billion in 2021 and gained a further 11.1% year-on-year in the first half of 2022.

China’s consumer e-commerce imports have been buoyed by favorable government policies, including the establishment of comprehensive pilot zones for cross-border e-commerce, through which goods can be imported with lower tariffs and regulatory barriers. There are now 165 such zones across China and the list of imported products continues to expand in response to strong demand from Chinese consumers.

There is growing demand for new types of consumer goods such as fresh and dry food products, cosmetics, garments, furniture, white goods as well as electronics.

Alibaba’s cross-border import marketplaces Tmall Global and Kaola, which together account for over 60% of cross-border e-commerce retail sales in China, provide insights into what brands around the world can expect from Chinese consumers in 2023.

Mr. Liu also predicts continued growth in specific categories in 2023, such as outdoor pursuits and pet care supplies due to the fact that nearly three years of lockdowns have driven millions of Chinese consumers to explore outdoor activities; including camping, picnics, skiing and fishing. As an example, this has led to a more than 700% jump in the value of retail imports of skiing equipment.

Chinese consumers are interested in high-end products and they research the brands and products they purchase more thoroughly than in any other market, according to McKinsey. They are tech-savvy buyers who know how to educate themselves through social media and other online channels.


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