Internet gift shopping booming in China

Christina Liu, a 32-year-old accountant living in Beijing, recently bought a 55-inch TV from a shopping website as a gift for her grandparents.

The TV was delivered to her hometown, where her grandparents live, in three days.

"My grandparents were surprised that it was so fast," she said. "And it saved me a lot of time, I didn't have to go to a physical store and to the post office."

Online gift shopping is a new trend for consumers when it comes to Chinese festivals or personal celebrations, and it has created a rapidly developing e-commerce gift market.

Yuan Chaofeng, director of the business development department of Amazon China, said that the company's gift card business, which was introduced to China in 2005, has seen three-digit growth every year since then - much faster than the company's overall e-commerce business - thanks to the rich gift-giving culture in China.

Among the many types of gifts on the Internet, gift cards quickly became a favorite among companies and individual customers due to their convenience, Yuan said.

Digital gift cards, which have values ranging from 300 yuan to 500 yuan ($47 to $79), are the most popular among customers.

Yuan said that online gift shopping is now not only popular on major festivals and holidays, but also on specific dates such as Teachers' Day and Valentine's Day.

About 54 percent of college students like to give gifts to their teachers to express their gratitude. Nearly 30 percent of those gifts are food, followed by tobacco, wine, and books, according to the Horizon Research Consultancy Group.

In addition to gift cards, traditional products related to Chinese festivals, such as moon cakes and crabs, as well as wine and health products, are the most popular options, along with home appliances and digital products.

For example, in September, Amazon China saw a surge in the sales of moon cakes, wine and coupons, which are popular gifts for the Mid-Autumn Festival, one of the most important festivals in Chinese culture, Yuan said.

The Chinese gift industry, which emerged about a decade ago, is estimated to be worth 800 billion yuan, according to the China Gift Chamber of Commerce.

Individual demand is estimated to be 505.5 billion yuan, while demand from companies and other organizations is worth 262.9 billion yuan, according to another survey by the China Gift Industry Institute.

The demand for gifts has been on the rise for three consecutive years, with an annual growth rate of more than 50 percent, according to the institute.

The growth of gift purchasing was more evident in 2008 during the Olympic Games in Beijing, and in 2010 during the World Expo in Shanghai.

About 60 percent of sales in the Chinese luxury market - which is expected to grow 20 percent this year according to a report by Bain & Co - are for gifts, said Yang Qingshan, guest researcher on luxury goods and services at the University of International Business and Economics.

Top gift choices, like the famous Chinese liquor Moutai or foreign red wine brands such as Lafite, have seen their prices increase rapidly.

Art items and antiques are also popular gifts for businessmen wishing to expand their networks.

But compared with the strong growth of the last few years, the gift industry this year is not particularly vigorous due to the economic slowdown. Many companies and organizations are cutting their gift budgets, said an official surnamed Ao with the China Gift Chamber of Commerce.

"A lot of our members have complained that their sales are not good," Ao said.

Li Yun, a manager at a gift manufacturing company in Shenzhen, Guangdong province, said that its profits have declined this year due to the rise of business-to-customer websites, which make prices and costs more transparent.

However the company has still managed to earn more than 5 million yuan a year from making gifts for government organizations, mostly products with Chinese characteristics such as porcelain pieces and silk scarves.

Ao said that many gift companies and agents are gradually becoming redundant as a result of direct online contacts between manufacturers and final customers.

Meanwhile, customers said that the gift industry should improve its levels of quality and creativity.

A manager at a government-related organization, who declined to be named, said that a gift that pleases its customers is not easy to find.

"Our customers have seen almost everything," he said. "So if you want to impress them, you have to give them something unique and useful."