Amazon to close online marketplace in China
Written by Hannah McGrath
Amazon has announced plans to scrap its online marketplace in China after losing ground to rival e-commerce giants Alibaba and JD.com.
The company announced plans to close its domestic marketplace on 18 July, in order to its focus efforts in China on more profitable activities including border trade, selling overseas goods and cloud computing services.
In a statement, Amazon said: “Over the past few years, we have been evolving our China online retail business to increasingly emphasise cross-border sales, and in return we’ve seen very strong response from Chinese customers.”
“Their demand for high-quality, authentic goods from around the world continues to grow rapidly, and given our global presence, Amazon is well-positioned to serve them.”
Shoppers in China will still be able to buy from international merchants on Amazon’s global store, while Chinese retailers will be able to use the same platform to sell to buyers outside of China, the company said.
Amazon first launched a site for the Chinese market in 2004 after buying out Joyo, the country’s leading book retailer for $75 million.
As JD.com and Alibaba’s Tmall have extended their grip over the online retail space, Amazon has seen its market share slide from around 15 per cent, to less than one per cent, as it struggled to keep up with its rivals.
Amazon is focussing its efforts on other e-commerce markets including India, and has pledged to spend $5.5 billion to take on Indian marketplace Flipkart.