E‐commerce development in China and its implication for business

China became the second largest Internet market and the biggest mobile phone market in the world in 2002. It is estimated that with China’s entry to the WTO, its commitments to liberalization in the telecommunication and financial services sectors will spur e‐commerce development in this country. The growing popularity of the telephone, the increased number of internet users, and the extensive competition in the telecommunications industry are all prerequisites for E‐commerce development, but they do not indicate the existence of expansion of the same pace in e‐commerce. There are multiple factors that contribute to the slow development of e‐commerce in China. The focus of e‐commerce in China will be different than it is in Europe and America because of the difference in traditional business models, conventional consumer behaviors, and consumer expectations. This paper analyzes the factors that have significant impact on the E‐commerce development. The paper is aimed to help businesses that want to expand e‐business in China to understand China’s e‐commerce development, its uniqueness, and its obstacles.