DHgate.com chief makes sure China's SMEs really deliver to overseas customers
Diane Wang Shutong's online trading platform is used by millions of mainland retailers to sell China-made products in more than 200 countries each day
PUBLISHED : Wednesday, 19 August, 2015, 9:30am
UPDATED : Wednesday, 19 August, 2015, 11:22am
Celine Sun
[email protected]
Diane Wang Shutong, chief executive of DHgate.com. Photo: Simon Song
At the entrance to online trading platform DHgate.com’s Beijing office, a big LED screen hanging on the wall displays an eye-catching electronic map of the world.
Visitors can watch as glowing arrow signs pop up every few seconds from somewhere in China and fly off to another country – possibly in Europe, North America or Oceania.
“This is our real-time transaction display system,” said Diane Wang Shutong, the company’s founder and chief executive.
“Once a Chinese trader delivers a parcel to a foreign customer, an arrow sign will appear and show where the goods are going.
“You will find the arrows jump out more frequently at night because that’s when it’s daytime for European and American buyers and they are more active.”
Her website is used by millions of mainland retailers from small- and medium-sized enterprises (SMEs) to sell their China-made products to customers in more than 200 countries around the world each day.
Diane Wang Shutong worked for Microsoft China, Cisco Systems China and mainland shopping portal Joyo.com before setting up her own company. Photo: Simon Song
From mobile phones, laptops and handbags, to wigs, wedding dress and gardening tools, trading volume on the online platform has been shooting up by more than 30 per cent annually in recent years thanks to the boom in China’s cross-border e-commerce.
E-commerce, especially online exports, has become a key new driver of China’s foreign trade, which is growing slowly amid the weak global economy.
So far in China there are more than 5,000 online trading platforms, led by global internet giants eBay and Amazon, as well as the leading mainland players, AliExpress and DHgate. The number of enterprises involved in cross-border e-commerce has also exceeded 200,000.
However, after several years of fast growth, more and more mainland traders are facing the same challenge: how to build their own brand image and improve customer experience in a market that is often many thousands of km away.
“We have seen huge opportunities ahead, but these opportunities come with real challenges, too,” said Wang, who was a senior executive at both Microsoft China and Cisco Systems China, and also chief executive of the mainland shopping portal, Joyo.com, which was later bought by Amazon.
She founded her own company, DHgate.com, in 2004 to help mainland SMEs tap into overseas markets.
According to official statistics, China’s foreign trade grew by only 3.4 per cent to US$4.3 trillion in 2014, compared with the year before. But over the same period, online exports surged by up to 59 per cent to US$513 billion and imports rose by up to 36 per cent to US$75 billion.
Over the past three years, the percentage of e-commerce in the mainland’s total foreign trade has risen from 7 per cent to 14 per cent. The Ministry of Commerce expects annual growth in the country’s online trading to remain at 30 per cent and exceed US$1 trillion next year.
The majority of e-commerce exporters are either traditional foreign traders going online, or domestic online shoppers expanding their overseas markets.
The internet has helped them to connect to customers all over the world in a more economical and efficient way.
“China and the United States are the two largest cross-border e-commerce nations in the world, but people buying from the two places have different reasons. From the US, people are buying brands and services; from China, they are mostly looking for good bargains,” she said.
“So how can we change this? There’s no set path to follow. We are still exploring.”
In June Wang was invited to speak at the Global E-Commerce Summit in Barcelona, which was attended by more than 850 people. During the conference, the Chinese businesswoman was asked the sensitive question of whether the increasing inflow of China-made products would lead to trust and safety issues.
“Trust is the first step for brand building,” Wang said. “It’s also something we can contribute to.”
Over the past few years, the Beijing-based trading platform has established a set of supplier-selection systems, examined by more than one million local suppliers, which provides details about things such as their operating histories, qualifications and trading records.
Customer services and localised marketing promotion are two areas in which Chinese enterprises are hoping to improve.
Dai Jing, founder of Shanghai e-Buy Networking Technology, earned his first big profits from selling leisure clothing and accessories on cyber markets such as eBay and the mobile internet shopping platform, Wish.
Last year was the best year so far for Dai’s company as it recorded total sales of US$10 million thanks to strong demand from global mobile internet markets.
However, the 32-year-old start-up entrepreneur remains cautious about business this year owing to the increasingly fierce online competition.
“There are more and more people coming into the market, selling similar things at lower prices,” he said.
To try to boost his company’s profit margins, Dai set up an independent website, Herefind.it, which focuses on the latest fashion styles, and he has also sponsored foreign social media celebrities to wear its clothes and post their pictures on both Twitter and Facebook to attract more fans.
“This is costing quite a lot of money, but we believe it’s worth trying,” Dai said
Another important move adopted by more and more Chinese online traders is the use of overseas warehouse services to speed up deliveries and improve customer satisfaction.
Many businesses are starting to rent warehouses managed by logistics companies or trading platforms in the US and Europe to help shorten product delivery times.
Some trading platforms, including DHgate.com, have also set up exhibition centres in popular cross-border destinations such as Russia to showcase their Chinese products directly to wholesalers and retailers there.
“Like many other industries in China, the foreign trade sector is also experiencing an internet reform,” said Wang. “Everyone of us is really looking forward to seeing strong Chinese brands emerging from this sector.”
