Research Report on China’s Taobao Village (2016)
Time: 2017-04-14 11:37   Views:839

Key findings

l  From inception to 2016, Taobao villages, now with a history of nearly a decade, have made new breakthroughs: over 1,000 Taobao villages and 100 Taobao towns are found across China.

l  As of the end of August 2016, a total of 1,311 Taobao villages were found across China, which are widely distributed in 18 provinces. Especially, Zhejiang, Guangdong and Jiangsu provinces come as the top three in China in terms of the number of Taobao villages.

l  As of the end of August 2016, a total of 135 Taobao towns were found across China. Especially, Zhejiang, Guangdong and Jiangsu come as the top three across China in terms of the number of Taobao towns.

l  As of the end of August 2016, 25 and 5 Taobao villages were found in Central and West China regions and Northeast China, respectively. Especially, Taobao villages were first found in Anhui, i.e. Liyuan Village, Dingjiaqiao Town, Jingxian County. Respectively one Taobao town was found in Sichuan (Anjing Town, Pixian County) and Liaoning (Zhongxiao Town, Haicheng City), which came as the first Taobao town in Central and West China and Northeast China, respectively.

l  In accordance with incomplete statistics, among customers of Taobao village online stores across China over the last year, over 47 million bought T-shirts, over 16 million bought toys, over 3.5 million bought sunglasses, over 2.9 million bought facial masks, over 7.3 million bought backpacks, etc.

l  Upgrading and development of Taobao villages

1. Product innovation. By virtue of analyzing consumption demands, enhancing independent design, seeking for joint R&D with partners and adopting new equipment and techniques, online merchants of Taobao villages have improved quality and launched new products. According to incomplete statistics, over the past year, more than 120 categories of emerging products of Taobao villages recorded rapid growth in sales, which exceeded RMB1 million or even RMB10 million for certain products, such as electric balance bikes, the “scholar’s four jewels” (writing brush, ink stick, ink slab and paper), Latin dance suits, custom murals and formula mixers.

2. Online merchant enterprization. With the expansion of operation scale, some online merchants of Taobao villages grow into enterprises by registering companies and trademarks, and attach great importance to team building, brand and customer service. According to incomplete statistics, there are over 5,100 online stores of Taobao villages which are registered as business enterprises. Top five counties (cities/districts) in terms of the number of enterprise online stores are Yiwu (Jinhua), Panyu (Guangzhou), Baiyun (Guangzhou), Jinjiang (Quanzhou) and Yuhang (Hangzhou).

3. E-commerce service systematization. With the development and expansion of online merchants, their demands for E-commerce services have gradually expanded and diversified, driving the upgrading of E-commerce services from small scale to large scale, from singularity to diversification and from a scattered model to a clustered one, thus gradually getting systemized. Systematization of E-commerce services is a significant mark of the upgrading and development of Taobao villages.

4. Development model diversification. During the initial stage of development, Taobao villages focused on online retailing, while now it shows the trend of diversified development with various models emerging such as online retailing, online wholesale, cross-border E-commerce and countryside tourism.

Economic and social values of Taobao villages

1. Incubation of a large number of gross-roots startups. One Taobao village is one incubator for gross-roots startups. As of the end of August 2016, there were more than 300,000 active online stores of Taobao villages across China. E-commerce has become an important direction for gross-roots startups.

2. Creation of mass job opportunities. Online merchants can establish startups at low cost, which develop rapidly, creating direct job opportunities and further driving the development of upstream and downstream industries which create indirect job opportunities. Data analysis results show that: for every one active online store newly established in Taobao villages, about 2.8 direct jobs can be created on average. According to such estimates, as of the end of August 2016, the jobs directly created by active online stores of Taobao villages nationwide recorded more than 840,000.

3. Poverty elimination and wealth creation through e-commerce. In 2016, 18 Taobao villages were found in national-level impoverished counties across China, including 10 in Pingxiang, 2 in Quyang and Zhenping respectively, and 1 in Antu, Heqing, Nankang and Yunxi respectively. A large number of online merchants have established startups via E-commerce to increase incomes and get rid of poverty. 


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