Shopping online in China is a unique experience due to the massive logistics network and the immense amount of vendors available.
I often get asked about how ecommerce works in China. This article serves as a place to point people to when they are curious about the topic. Instead of me retelling the same answers and often missing points here and there, this serves as a place to collect and pen down my thoughts and experiences.
The two biggest platforms are JD.com, also known internationally as JoyBuy, and Taobao. They are in the Tencent and Alibaba ecosystems respectively. The competition between the two ecosystems is an interesting topic that deserves its own article.
As an Alibaba service, Taobao naturally only accepts payments from AliPay. JD is a member of the Tencent ecosystem and thus only takes payments from Tencent’s WeChat Pay. Of course, each platform also accepts payment by linking bank cards, and JD has its JD Quick Pass service that allows payment via ApplePay.
Other smaller platforms include:
- Vipshop aka VIP.com – the third largest after JD and Taobao.
- Dangdang – the second largest B2C (business-to-consumer) after JD.
- Pinduoduo – a platform that initially focused on group buys before changing to a marketplace model.
Taobao is the first major ecommerce platform. It operates with a marketplace model where vendors can register and sell their products in their stores. Taobao was less regulated in the early days and it gained a bad reputation due to scams and counterfeit products.
To increase consumer trust in the platform, Alibaba rolled out Tmall, a platform for brand owners or authorised distributors. The approval process is stricter compared to Taobao and vendors had to pay a RMB 150,000 deposit on top of an annual fee of RMB 60,000 to sell on the platform. Tmall products and stores are searchable within Taobao, and users can choose to view only Tmall vendors in their searches if they prefer to buy only from verified and reliable vendors.
Items sold by vendors within the same province as you usually ship within 2 days. Vendors from other provinces will ship within 7 days.
You can find almost anything on Taobao. We purchased supplies, equipment, and decoration for our cafe on Taobao.
Since Taobao is a C2C (consumer-to-consumer) platform, you can often negotiate with the seller. This is something that blew my mind. When I purchased online via eBay or Amazon, I bought what the vendors sold. Taobao has a live chat feature and most vendors reply almost immediately.
You can request for customised products, bargain for a better price or request for free shipping if you are purchasing in bulk. Customer service can also give suggestions or recommendations based on your preferences and requirements.
Returning items bought on Taobao used to be more troublesome. However, due to the hassle-free service JD provides, Taobao has become more competitive.
Most products come with a 7-day return policy, unless they are perishable or products that can’t be returned. Most vendors provide 7-day no questions asked return policy. This means you don’t need to provide a reason for returning or wait for the vendor to approve the return. The platform will automatically process the return if it is within the return window period.
One thing to look out for is the shipping fee insurance. Not all vendors provide shipping fee insurance. This means you will have to bear the cost of the return shipping. For products with shipping fee insurance, you still need to pay the cost of the return shipping but the platform will refund you the shipping fee once the vendor receives the returned item.
In the past, you would have to bring the parcel to a distribution spot in the neighbourhood to drop off the returned item. It is actually not that big of a hassle because this is usually within 200 metres from where you live.
Nowadays, the delivery person will come to your doorstep to pick up the item. Just select your preferred collection date and time when you process the return in the app. Alternatively, you can choose to leave the parcel in the nearest collection locker, which is available in every apartment block lobby nowadays, and the delivery person will collect it when they come to drop off parcels in the lockers.
JD differentiated itself from Taobao through a B2C model. Brands supply their products to JD and the platform manages the logistics including warehousing and fulfilment.
JD is known for its speedy delivery. Since products are sold by JD rather than third-party vendors, they undergo strict a curation process to ensure that the products are genuine and of good quality.
I purchase my groceries, toiletries and other household items from JD because of JD’s partnership with Walmart. If I run out of rice, cooking oil or dog food, I know I can place an order immediately and receive the items on the same day or in the next morning.
Same or next day delivery
If you purchase before 10 am, it is usually a same-day delivery unless your item is out of stocks in the nearest warehouse. For purchases made after 10 am and before 11pm, the orders will be delivered the next morning.
The app will let you know the estimated delivery time before you place an order. Instead of shipping all your products together, items from the same dispatch location will be shipped together. This means that if you order 3 items and 1 of them is out of stocks, the other 2 items will be shipped first and the third item dispatched from the next nearest warehouse.
Such delivery speeds means JD is the go-to platform if you need your orders to be delivered quick.
I purchase electronics through JD because of the awesome warranty and return policy. JD trumps Taobao in terms of its return service and warranty. For many electronic products, JD offer additional warranty extensions. This means that JD will cover for repairs beyond the manufacturers warranty period.
JD offers a 7-day return with no questions asked policy. This means you can try an item and return it if you don’t like it. Of course, you have to make sure that the item is not damaged and retain the original packaging. The item is picked up by the JD delivery person. Each neighbourhood is serviced by a few JD delivery staff. They personalise their service to, uh, deliver the best customer experience.
My JD delivery guy knows the time of the day I’m at home so he will try to delivery heavy and bulky items during those times so he can bring them right to my doorstep. If I’m not around, the building security would not allow him to come upstairs. He would have to leave them in the lobby and I would have to carry the items up myself. If he’s unsure of the time, he would call to check before making the delivery.
Such outstanding service is a company-wide standard. I’ve had a different delivery person for each neighbourhood I’ve lived in and for different office locations, and the service standard is always the same. This is why I prefer to purchase from JD even if an item is cheaper on Taobao.
Taobao still uses third-party shipping services, so the service standard varies and certain shipping services refuse to bear the cost of the return shipping. For example, we tried to return a display bought off Taobao on the day we received it. However, the shipping service refused to accept the returned item because they could not cover the cost of the insurance. They asked us to ship via another shipping service and bear the additional cost of the shipping insurance.
Until Taobao has its own fulfilment service, I doubt they will be able to catch up with JD in terms of customer experience and satisfaction.
JD has a third-party marketplace where verified vendors sell their products on the platform. I rarely purchase from these sellers. The exception is when they provide imported products that JD does not offer. The drawback of purchasing from third-party vendors is the that they use their own shipping service that is slower than JD’s. Even if they are fulfilled by JD, it is still not as fast as products fulfilled from JD’s warehouse.
JD Plus membership
Taobao has a membership program, but I don’t buy enough from Taobao to warrant subscribing. I purchase almost all my household supplies from JD, so it’s a no-brainer to sign up for JD’s Plus membership.
For an annual fee of RMB 99, I get 5% off my purchases, enjoy members-only discounts and shipping no minimum order amount for free shipping. JD requires a minimum order of RMB 99 for free shipping. I save at least RMB 99 per month with JD Plus.
I’m very pampered by JD, and Taobao vendors generally provide good services. So I haven’t found the need to purchase using other platforms. I won’t comment on the platforms since I don’t use them. If I do venture to try them, I’ll definitely write about my experience.