In the last two years, IDC visited more than 30 traditional enterprises and industry clusters proceeding from the emerging mode of Internet such as e-commerce, and obtained a deep insight into the impact of Internet on traditional industry transformation and upgrade.
Yolanda Zhang, research manager of IDC China believes that, “in the Two Sessions (the National Peoples’ Congress and Chinese People’s Political Consultative Conference), Internet Plus is among the hottest vocabularies. The State for the first time encourages and supports the development of Internet as a strategic emerging industry.
“It can be foreseen that Internet will play a significant role in promoting industry upgrade and leading the new economic development of the whole country.”
IDC analyst believes that the early stage of Internet-driven transformation and upgrade of traditional industries will be seen in three aspects: restructuring the industries of retailing, circulating, advertisement, media, and manufacturing through e-commerce transforming and upgrading financial industry by Internet, and O2O providing information support to service industry for the convenience of livelihood.
The keywords of traditional industry evolution initiated by e-commerce are interpreted by IDC:
* The rise of consumer rights becomes the driving force of the evolution. Many traditional industries attribute this industry evolution to the “free charge” of Internet, while IDC believes that the evolution has been mainly caused by the fact that it echoes the rise of consumer rights. To IDC, the industry evolution initiated by e-commerce is essentially a process in which consumers maximise their own rights via Internet technology. Normally, the demand & supply relation between the vendor and consumer decides the ability to bargain for both sides. However, the vendor knows much more information about the market than individual consumers, thus having an additional advantage in the ability to bargain. The emergence and development of Internet applications such as e-commerce have enhanced the ability of consumers to obtain market information, helping them make the most out of their option rights.
* C2B will be the direction of consumer markets. IDC believes that with the severe oversupply of basic products from traditional industries and the rising consumer demand for individuality, the mode of Consumer to Business (C2B) will be the key direction of future transformation and upgrade of traditional industries. E-commerce has made it increasingly easier for consumers to buy customised products. The growing demand for individuality from consumers and enhanced ability to bargain will inevitably make C2B the trend of the industry. Meanwhile, the rapid development of China mobile e-commerce will also speed up this process. As mobile phones or terminals are accessible to all consumers, the development of mobile e-commerce will not be a simple shift from PCs to mobile devices. Instead, it will provide more customised products and services based on the needs of individual consumers.
* The migration of mainstream consumers provides overwhelming momentum for the evolution. In terms of demographic structure, the rising of 1990s and the potential of 2000s will determine the future of China’s Internet industry. In 2013, the coverage of the Internet in 1990s was close to 32%, and it is expected to exceed 40% in 2014. By comparing the distribution of Internet users of all ages in 2003 and 2013, it shows that, the mainstream group of consumers aged from 20 to 40 are increasingly penetrated by Internet. As the 1990s and 2000s gradually become the core consumer group, the industry evolution initiated by e-commerce will be an inevitable trend.