CNNIC: The 38th Statistical Report on the Development of Internet in China in 2016 - Development of Business Transaction Applications (IX)

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• CNNIC: The 38th Statistical Report on the Development of Internet in China in 2016 - Internet Basic Resources (I)
• CNNIC: The 38th Statistical Report on the Development of Internet in China in 2016 - Internet User Scale and Structure (II)
• CNNIC: The 38th Statistical Report on the Development of Internet in China in 2016 - Scale of Mobile Internet Users (Part 3)
• CNNIC: The 38th Statistical Report on Internet Development in China in 2016 - Scale of Rural Internet Users (IV)
• CNNIC: The 38th Statistical Report on the Development of Internet in China in 2016 - Internet User Structure (V)
• CNNIC: The 38th Statistical Report on Internet Development in China in 2016 - Internet Access Environment (VI)
• CNNIC: The 38th Statistical Report on the Development of Internet in China in 2016 - Development of Personal Internet Applications (VII)
• CNNIC: The 38th Statistical Report on the Development of Internet in China in 2016 - Development of Basic Applications (VIII)
• CNNIC: The 38th Statistical Report on the Development of Internet in China in 2016 - Development of Business Transaction Applications (IX)
• CNNIC: The 38th Statistical Report on the Development of Internet in China in 2016 - Development of Internet Financial Applications (X)
• CNNIC: The 38th Statistical Report on the Development of Internet in China in 2016 - Development of Internet Entertainment Applications (XI)

(II) Development of business transaction applications

2.1 Online Shopping

As of June 2016, the number of online shopping users in my country reached 448 million, an increase of 34.48 million from the end of 2015, with a growth rate of 8.3%. my country's online shopping market still maintains a rapid and steady growth trend. Among them, the number of mobile online shopping users in my country reached 401 million, with a growth rate of 18.0%, and the proportion of mobile online shopping increased from 54.8% to 61.0%.

From macro policies to corporate promotions, the government and enterprises work together to promote consumption upgrades. The 13th Five-Year Plan has clarified the direction of consumption upgrades from the top-level design, emphasizing the expansion of service consumption as the focus to drive the upgrading of consumption structure and guide consumption towards intelligence, environmental protection, intensiveness and quality. As a product of the combination of traditional retail and information consumption, online shopping conforms to this development trend towards new consumption upgrades. At the same time, the marketing methods of e-commerce platforms have been diversified and upgraded, extending from shopping consumption models to service consumption models. For example: introducing media elements on PC and mobile terminals for interest-based shopping, expanding the media functions of e-commerce; exploring video e-commerce shopping guide models, using short videos and live broadcasts as carriers to dig deep into the economic value of the Internet celebrity effect, etc.

In terms of cross-border e-commerce, with the introduction of the new tax policy, my country's cross-border e-commerce has entered a standardized development period from a policy dividend period. In March 2016, the Ministry of Finance, the General Administration of Customs, and the State Administration of Taxation jointly issued the "Notice on the Tax Policy for Cross-border E-commerce Retail Imports", and announced the "Cross-border E-commerce Retail Import List" on April 7. The introduction of the new policy, on the one hand, marks the determination of the model and status of cross-border e-commerce imports from the basic level of "tax", and represents the government's positive attitude towards the development of the cross-border e-commerce industry; on the other hand, it also means that the industry has "gone from chaos to order" and entered a high-speed development track of standardization, mechanism, and scale, which will help the medium and long-term development of the industry. The extension of the transition period of the new tax policy is conducive to exploring new regulatory models and providing a buffer for the industry.

In terms of rural e-commerce, the two-way circulation of "online goods going to the countryside" and "agricultural products going to the city" promoted by the government and e-commerce enterprises has accelerated the process of urban-rural integration. The "Guiding Opinions on Promoting the Accelerated Development of Rural E-commerce" issued by the General Office of the State Council proposed seven policy measures to create a good policy environment. E-commerce enterprises set up rural service stations in counties to extend the advantages of e-commerce platforms, break through the bottlenecks of logistics and information flow, and make up for the shortcomings of talents and awareness. This is not only conducive to narrowing the income and consumption gap between urban and rural areas, but also attracting more talents to return to start businesses, thereby promoting the development and construction of rural modernization economy. In addition, with the advancement of rural e-commerce, the e-commerce service industry developed around e-commerce has a broader market space and development potential.

2.2 Online food delivery

As of June 2016, the number of online food delivery users in my country reached 150 million, an increase of 36.1 million and a growth rate of 31.8% from the end of 2015. Among them, the number of mobile phone online food delivery users in my country reached 146 million, a growth rate of 40.5%, and the proportion of mobile phone online food delivery increased from 16.8% to 22.3%.

The online food delivery industry is in a stage of rapid development. The gradual standardization of the policy environment, the rational return of market competition, and the continuous extension of the industry's service radius have led to the continuous growth of the user scale of the food delivery industry.

From the perspective of the policy environment, the development norms of the online food delivery industry have been gradually established. The "Catering Industry Management Measures (Trial)" promulgated by the Ministry of Commerce and the National Development and Reform Commission for the first time included management regulations for food delivery services; the "Online Food Safety Management Measures" successively launched in various places restrict the service behaviors of catering service operators and third-party platforms in the online food delivery industry. At the same time, the "motorcycle ban and power restriction" measures in densely populated cities pose severe challenges to the online food delivery industry. The online food delivery industry needs to gradually improve its service mechanism under the supervision of the government to promote the continuous, stable and orderly development of the entire industry.

From the perspective of market competition, the industry structure tends to be stable, and enterprises are gradually returning to rational competition. Driven by capital, the online food delivery industry structure remains stable. However, the practice of cultivating consumption habits through subsidies in the early stage is likely to make users dependent on subsidies. Online food delivery companies need to further retain highly sticky users through services, gradually enhance their ability to convert subsidies into consumer retention, and put the company on a virtuous cycle of development.

From the perspective of development potential, the food delivery industry is in the early stage of market cultivation and has market potential and development space. With the continuous improvement of the Internet application level of urban people, the significant enhancement of individual consumption capacity, the gradual formation of personalized delivery service consumption habits, and the acceleration of China's urbanization process, the demand for online food delivery services will expand rapidly; and the logistics and distribution system built from catering services can be expanded around "short-distance" services to a variety of delivery businesses closely related to life, with broader development prospects.

2.3 Travel Booking

As of June 2016, the number of Internet users who have booked air tickets, hotels, train tickets or travel and holiday products online reached 264 million, an increase of 4.06 million people and a growth rate of 1.6% compared with the end of 2015. Internet users who booked train tickets, air tickets, hotels and travel and holiday products online accounted for 28.9%, 14.4%, 15.5% and 6.1% respectively. Among them, the number of Internet users who booked air tickets, hotels, train tickets or travel and holiday products via mobile phones reached 232 million, an increase of 22.36 million people and a growth rate of 10.7% compared with the end of 2015. The proportion of Chinese Internet users who use mobile phones to book online travel increased from 33.9% to 35.4%.

In 2016, the competition in online travel booking of air tickets, hotels, and travel vacations has entered a "red ocean", and companies are seeking ways to break through, which are specifically reflected in the following three aspects:

In terms of air ticket business, airlines' online air ticket booking business will become dominant, entering a period of "increasing direct sales and reducing agency sales". Since aviation service providers have relatively concentrated resources, their own membership systems are relatively mature, and they are less dependent on OTAs, airlines are able to conduct direct sales. For OTA companies, their large user scale and comprehensive travel services will enable them to play a greater role in introducing direct ticket sales traffic.

In terms of hotel business, hotel service providers with more dispersed regions and brands will continue to rely on online booking companies. As for online booking companies, the game with hotel service providers and the competition among online booking companies will be more intense: on the one hand, online booking companies that mainly rely on commissions have put a certain pressure on the income of hotel service providers, and some hotels have already focused on direct sales; on the other hand, search, group buying, and e-commerce applications have entered the hotel booking business, and the competition among various online booking companies will be more intense.

In terms of tourism and vacation business, OTA enterprises have achieved the connection of upstream and downstream of the industrial chain with the support of capital. In terms of channels, they have in-depth cooperation with scenic spots, and have sufficient voice and control from planning and design to project investment to scenic spot operation. In terms of services, through investment reconstruction, they create high-quality tourism enjoyment in hotels, food, shopping and other aspects, and have a unique service brand and reputation. In terms of products, they develop scenic spot projects and theme tourism activities through investment, brand authorization and entrusted operation.

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