Amazon to further invest in China

US retail giant to enhance speed of delivery, offer more global products in Chinese market

Retail behemoth Amazon.com Inc will continue to increase investments in its cross-border shopping business Amazon Global Store in China and is bullish on the prospects of this segment, although the United States-based tech giant is now facing increasingly fierce competition from local e-commerce rivals.

Somana Konganda, head of Amazon Global Store, said they have not set a limit for the investment amount in the Chinese market, emphasizing the company's focus on China's business has not changed.

"We are focused on providing a vast selection of high-quality international products and that focus will continue," he said.

Amazon Global Store covers top destinations of Chinese customers' cross-border shopping, including the United States, the United Kingdom, Japan and Germany.

"I am optimistic about the business in China," said Konganda, adding the company will double down on its presence in the Chinese market.

Sales revenue on Amazon Global Store in the first quarter of 2019 achieved double-digit growth.

But Amazon is struggling to contend with local leaders such as Alibaba Group Holding Ltd, JD and NetEase Kaola, which have been ramping up their efforts in cross-border shopping.

Chen Tao, an analyst at the Beijing-based consultancy Analysys, said: "Amazon has strong competitiveness and a good reputation in its global logistics, warehouses and supply chain, but it faces some challenges in its localization in China."

Chen added Amazon lags behind its rivals in marketing promotion and business operations in China. Compared with Amazon, domestic online retailers have a better understanding of local consumers' needs and how to operate under local market conditions.

Konganda noted Amazon will make full use of its global resources, enhance its speed of delivery and offer a wider range of global brands and more discounts to Chinese consumers in the future.

For instance, customers can now enjoy faster delivery of overseas products in as little as three working days for 82 cities in China due to Amazon's forward warehouses.

Amazon has also launched an artificial intelligence-enabled size guide widget for apparel products based on a leading algorithm.

Konganda said Amazon has more than 175 operating fulfillment centers and 100,000 robots in its warehouses across the globe.

"Chinese consumers' demands have become more and more diversified and personalized," said Gu Fan, vice-president of Amazon China, adding the company will step up efforts in the cross-border online shopping sector through Amazon Global Store and Prime membership.

Gu said starting from 11 pm on July 14 to 3 pm on July 17, Amazon's prime members in China will enjoy the longest Prime Day globally with 64 hours of shopping.

In April, Amazon said it plans to shut down its third-party seller services on its Chinese online marketplace in July, but emphasized it will not exit the Chinese market.

In addition, Amazon will continue to invest in its Amazon Global Selling business, which helps Chinese merchants sell products abroad, cloud service platform Amazon Web Services, Kindle devices and content, in China.

China's cross-border e-commerce sector has been growing exponentially over the past few years as the country's middle-and high-income shoppers are demanding increasingly diversified and personalized products and services.

Market consultancy iiMedia Research said the country's cross-border online shopping reached 9.1 trillion yuan ($1.3 trillion) in sales last year.