E-Commerce Growth Remains Slow in Greater China

[January 16] Despite growing Internet penetration across Greater China, e-commerce activity remains low, according to new research from Interactive Audience Measurement Asia (iamasia).

The research, conducted in a six-month period between 2Q2000 and 4Q2000, showed the number of Internet users in Greater China [the People’s Republic of China, the Hong Kong Special Administrative Region, and the Republic of China on Taiwan] reached 23.8 million. Among these users, 15.2 million are from the People’s Republic, 2.2 million from Hong Kong and 6.4 million from Taiwan. This represents a penetration level of seven percent in the Chinese mainland, 34 percent in Hong Kong and 31 percent in Taiwan.

Apart from the growing number of Internet users, the demographic profile among these users becomes more diverse and close to the general population. The gender disparity of the online population is narrowing, with female users accounting for approximately 40 percent of Internet users in the Chinese mainland, 43 percent in Hong Kong and 45 percent in Taiwan.

“This is an audience that is clearly gaining critical mass,” said Kevin Tan, chief executive officer of iamasia. “In Hong Kong, however, there are serious concerns raised by the extremely slow growth in Internet usage in the workplace and the predominantly negative perceptions held by consumers toward e-commerce.”

Despite the growing Internet penetration, e-commerce penetration remained low across the region. Only 13 percent of Hong Kong Internet users had completely a transaction online, compared with 10 percent in China and 10 percent in Taiwan.

Two-thirds of Internet users surveyed explained they are uncomfortable with purchasing goods or services online, and almost three-quarters of those polled in Hong Kong said they will not try e-commerce in the next 12 months.

The survey explained it was a problem of perception, as Internet users with previous e-commerce experience report a significantly more positive view of e-commerce than those who have never tried it.

Internet usage in the workplace is also extremely low, according to iamasia. Only 26 percent of Internet users in Hong Kong log on at their workplace and 40 percent of Taiwan Internet users get online at school.