28 October 2016
HKTVMall launched a HK$30 million MTR campaign earlier this year as part of a summer giveaway promotion. Photo: internet
HKTVMall launched a HK$30 million MTR campaign earlier this year as part of a summer giveaway promotion. Photo: internet

E-vendors: Who will have better chances in HK?

E-shopping isn’t a big thing in Hong Kong as people here find it very easy to visit physical stores for all their needs, unlike residents of some other major world cities.

Malls are ubiquitous in the former British colony, with practically all neighborhoods and subway train stations boasting excellent shopping facilities.

People living in public housing estates find it convenient to visit stores that are inside one of the 175 properties run by the government-backed Link Real Estate Investment Trust. Meanwhile, most of the private housing projects also come with shopping centers.

Apart from shops providing daily necessities, big department stores and upscale shopping arcades are rarely more than 30 minutes away from one’s home or office.

Other than prime spots like Causeway Bay, Tsim Sha Tsui and Mongkok, there are plenty of choices in non-core areas or emerging business centers (like Kwun Tong, for example) where rentals are cheaper.

Does that mean local e-vendors won’t have much prospects?

Well, the answer might be both yes and no.

It is a fact that more people are doing shopping with smartphones or computers nowadays. The majority of them buy online because they can find better deals. Others are shifting because they are busy or have to work late shifts and thus have no time to visit brick and mortar stores.

Youngsters are of course more receptive to buying from e-vendors. With many youth spending long hours on activities like web surfing, online chatting and gaming, e-shopping is only a natural extension.

That said, not all kinds of online stores stand a good chance of making profit.

The future of big platforms like HKTVMall looks a bit worrisome. E-commerce is all about transcending physical boundaries.

Online platforms in Hong Kong are small compared to the super cyber bazaars like Alibaba or Amazon, where one can find almost anything, any brand. Thus, local platforms can’t beat the behemoths in product variety.

Staying price competitive would also be hard as these players are not just competing with local brick and mortar shops, but also with cross-border e-commerce giants that enjoy scale advantage and niche players that draw cost competitiveness from their fine focus.

For instance, it is entirely possible to find cheaper offers or special deals from foreign websites if it is imported items you are after. Easy comparison of prices has been one big incentive for online shoppers after all.

Amid this situation, who might have a better chance?

Companies already running a successful brick and mortar network can leverage on the brand name and existing infrastructure (like procurement and warehousing capacity) to reach more local clients as well as overseas shoppers through a dedicated e-channel.

Small shops selling niche items that cannot be easily found in shopping malls — like local design and handicrafts — could also work.

E-shops that offer experience rather than goods could be another, for example cake-making lessons. E-stores could also be useful as a complement to traditional retailing in reaching online audiences, promoting the product and drawing them to physical stores, or so-called online to offline approach.

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EJ Insight writer

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