May 1, 2020
Online sales channels have risen to prominence and helped China’s seafood industry survive the coronavirus during this harsh season. Now, with the country gradually recovering from this epidemic and growth of virtual sales slowing down, some say more and more consumers are returning to brick-and-mortar retailers.
There is enjoyment in walking to farmers markets on a sunny day to hand pick fresh seafood, said Shu, a consumer in favor of such prediction. She has also complained that the fresh food she bought online was not that fresh and sometimes the delivery took quite long time. According to another consumer, Wei, fresh food in her neighboring market is fresher and cheaper.
However, their view is seemingly not shared among the majority. In a survey involving nearly 1,000 interviewees, more than 95% said they were happy with what they had got online in spite of such problems as higher prices and slow delivery at times. And many said they will continue to place orders online.
Within this first quarter, online seafood sales has ballooned by 60% from the same period last year. And during this Chinese New Year, online buyers of fresh food has increased by about 57%. Despite problems looming ahead, there is expected to be no obvious reduction in online seafood shoppers who are getting “lazier.” And this shift to virtual markets is expected to be long-lasting rather than temporary.
Owing to great confidence in these virtual sales, many are drafting online marketing plans, and some have already reaped some profits. For example, on April 14, the Consul General of the Argentine Consulate in Shanghai has tried to attract more Chinese foodies’ attention to the country’s red shrimps in his livestream. In the following day, Argentina’s Michelin chef has hosted some online cooking lessons.
Hema, another case in point, has cooperated with one online celebrity in China and sold out of 6 million crayfish within 5 seconds in its livestream on April 21. Back on April 1, its parent company, Alibaba, has already purchased 1-billion-yuan crayfish from Hubei and then promoted them through new channels. And in another magical 5 seconds on April 30, the online celebrity has helped create a crayfish revenue of 9.27 million yuan for Guolian.
In addition to new retailers, traditional ones have also attached more importance to the virtual platform. One main seafood market in Beijing, Jingsheng, has designated an area specifically for occupied deliverymen to pick up seafood and then send them to buyers who placed orders online earlier. Xu, one deliveryman, said that he received at least dozens of orders every day. More tend to buy through online platforms like WeChat, said Ma, one seller there.
The online seafood market is booming, and increasing quantities of sellers are trying to raise virtual market shares as soon as possible. But before rapidly marching into this new era with great confidence, industry participants may want to be more careful and getting prepared for some potential problems of this “gold mine”.
This market is often welcoming new entrants and also saying goodbye to existent ones. According to one struggling seller, there are problems such as easy entry, similar products and fierce competition. Though end consumers purchase seafood frequently, gross profits are low, while transportation and marketing fees are not low at all. And there is a problem of high wastage rates in delivery.
Undoubtedly fresh food e-commerce industry is to expand rapidly in the near future, and some predicts that the annual growth rate is about 35% within the coming three years. With more flooding into this virtual market and also some wiped out, it is to get more mature. Differentiation and branding may be of rising importance in this new battlefield.