A Comparative Study Of Chinese B2C E-commerce Profit Model

According to <the annual report of China E-Commerce Statistics2011-2012>from iResearch, the trading of E-Commerce in China is6.300trillionYuan and the growth rate is32.4%, which accounts for13.4%of47.2trillion of thetotal GDP of China in2011. In addition, Statistics from IDC and Alibaba showed thatin2011the total of the trading via E-Commerce in China reached784.93billion Yuan,which is166%of the amount in2010and far more better than the growth rate of thetotal of retail during the same period of time, which is11.6%. Therefore,E-Commerce in China has enormous potential and is becoming the engine of thegrowth of Chinese economy. Currently the market of E-Commerce in China is thesecond biggest in the world, we believe that the expansion of E-Commerce is going tobe exponential. We estimate that in2015the market will be the biggest in the worldand the population of people who use E-Commerce will be329million in China.The well-established internet in China provides a foundation for people shoppingonline in terms of technology. At present, though the share of B2C in the wholeE-Commerce is small, in long term, B2C will become the majority of E-Commerce inthe future. All different kinds of E-Commerce will start to merge.2011is the first year of the12th China Five Year Plan. E-Commerce has beenthrough the following stages: emerging, developing fast, and recession.2011is thefirst year of another new stage, namely fast growing. In recent years many B2Cwebsite emerged and many companies in the industry began to join the B2C market.The tendency that B2C takes over C2C is persistent. M18and Dangdang going publicare the milestones of the development of E-Commerce in China. In2011, thedevelopment of E-Commerce in China attracted enormous attention from everywhereand hit the bottom and the top in the same year. How to seize the opportunities togrow, how to be extraordinary compared to so many rivals, how to find the rightdirection of developing, and how to grow steadily are the most concerned questions.In this paper, we start with the discussion of various theories of models ofE-Commerce profits, then we focus on the development of B2C in China and comparetwo typical B2C companies,360buy and Amazon, in China and in US respectively.From the comparison, we identify the problems that B2C companies in China arefacing and propose the solution how to make profits. This paper is organized asfollows：Chapter one: foreword. In this chapter, we give introduction of background and theobjective of this research. In this case, how B2C Companies can stay healthy, developsteadily and keep making profits is the key point of this research. Our researchmethods are case study and comparisons via360buy and Amazon. Then we identifythe problems of Chinese B2C companies and make some proposals of making profits.Chapter two: Introduction of E-Commerce theories. Firstly, we give a definitionof E-Commerce and discuss how E-Commerce impacts the development ofeconomics. We define the business models of how E-Commerce makes profits andpresent the benefits obtained from them. Not only does this research provide many theories and principles for the community of E-Commerce research but also givepractical applications to help Chinese B2C companies to develop properly in longterm.Chapter three: The status of the development of E-Commerce in China. Later inthis chapter, we provide some case study about the status and background of wholeE-Commerce industry.The fourth and fifth chapters introduce and analyze the reason of AmericanAmazon company’s success and the operating situation of Jingdong mall respectively.Chapter six: How Chinese B2C companies can be profitable. Combining theprevious cases, this chapter summarizes and analyzes the problems existing in currentChinese B2C represented by Jingdong mall.Chapter seven: Conclusion and prospect. In the early stages of B2C e-commercein China is undergoing a difficult process of transformation, which involved manycompanies engage in fierce competition with the game, we all make effort to seek abreakthrough in the crisis, to meet China’s B2C e-commerce market in transition andmaturity. In conclusion, after going through difficult exploration, B2C e-commerceenterprises in China and the market is maturing, its prospects is undoubtedly broadand bright.