Is Rural Commerce the new face of Chinese e-commerce?Farmers reap gains in livestream boom. Let’s see how Live Commerce China’s farmers survive the pandemic

Out of the fast-growing e-commerce market in China, one area is showing even more potential: rural China. According to data, China’s rural e-commerce generated $195 billion worth of e-commerce sales in 2018, up 30.4% year-over-year and far outpacing the 24% growth seen in China’s overall e-commerce market. Today, the whole sector saw more than 87,000 newly registered rural e-commerce enterprises this year, up 13.6% from a year ago. In the meantime, over 8,000 rural companies have added e-commerce, online sales or other related businesses, according to Tianyancha.com.

As the novel coronavirus epidemic dented consumption in the country, China has been encouraging innovative ways to tap market potential, especially in the countryside. A virtuous circle is taking place whereby e-commerce is enabling more rural residents to become entrepreneurs by selling local products online, and the resultant income growth is driving up e-commerce-based consumption as these rural residents seek out products they can’t find in their neighborhood stores.  Rural e-commerce is expected to see continued growth thanks to government support, analysts said.  

©Abacus. Kuaishou said there are 1.15 million rural users selling local products on its app through both short videos and live-streaming.

Both JD.com and Alibaba-owned Taobao quickly launched rural live-streaming initiatives, building on the engagement-centric format that had skyrocketed in popularity in China over the previous few years. Rural live-streaming had existed before but hadn’t truly taken off. In 2019, Taobao’s goal was to attract a mere 1,000 farmers to its platform.

“Most farmers didn’t know how to live-stream; even fewer understood e-commerce,” says Zhang Guowei, the head of JD Live. One of key word to understand this trend is, once again, Live Commerce. Live-streaming helped China’s farmers survive the pandemic. When coronavirus ground the country to a halt, the agricultural industry could no longer sell its products. Thus, e-commerce giants used the chance to bring the sector online. China has always been at the forefront of technology. In recent times, however, the livestreaming economy is opening up new roads not only in the big cities, but also in small villages and inhabited centres. Today, Chinese consumers could directly buy pineapples from Hainan farmers, dry grapes from Xinjiang and more. 

©GT. China’s rural economy gets boost from e-commerce

Local government authorities County chiefs and city mayors were encouraged to promote local products via livestreaming, with more than 4 million live broadcasts made in the first quarter, according to data from the Ministry of Commerce. In Q1, online sales of farm produce reached about 13.14 billion US dollars, a rise of 31% year on year, according to the ministry.

While most elderly people in China still rely on their neighborhood markets, the tech-savvy younger generation, particularly those born in the 1980s and 1990s, prefer online grocery shopping. But the pandemic outbreak accelerated this digitalization process. People today are seeking fresh food and quality. Through livestreaming, farmers can directly connect with consumers and integrate production and marketing in an efficient manner, moreover, can directly explain how they produced the food that are selling.

“With the rapid development of digital technologies in villages, more farmers will hop on the livestreaming bandwagon, promoting the development of modern agriculture in China,” said Hong Tao, a professor from Beijing Technology and Business University. Is Live Commerce the future of agricolture?