Traditional E-commerce GMV Growth Slows to 8.7% in 2025: Category Divergence and Platform Strategies
Traditional E-commerce Reaches Growth Inflection Point
China's Ministry of Commerce, Department of Electronic Commerce and Informatization released data in June 2025 showing that Q1 2025 online retail sales reached 4.2 trillion yuan, a year-on-year increase of 8.7%, down 2.1 percentage points from the same period in 2024. This marks the third consecutive quarter of GMV growth below 10% for traditional e-commerce. Data shows that the growth inflection point for traditional e-commerce has arrived. We believe this is not a cyclical fluctuation, but a structural change—user time is being diverted by new formats such as short videos, instant retail, and local lifestyle services, and the "traffic dividend" for e-commerce platforms has disappeared. What's worth warning is that the combined user time for Alibaba Taobao, JD.com, and Pinduoduo decreased by 14.3% year-on-year. This means that even though GMV is still growing, users' "attention share" is rapidly declining.Category Divergence: Winners Keep Winning While Losers Exit
Category 1: Beauty & Personal Care—High Growth, High DivergenceIn Q1 2025, the beauty & personal care category's GMV on traditional e-commerce grew 23.5% year-on-year, but divergence within the category is severe. The market share of TOP 10 brands increased from 41.2% in 2024 to 48.7% in 2025, further squeezing the survival space for small and medium brands. What does this mean? We believe the beauty & personal care category has entered a "brand dividend period," and white-label products without brand premium will quickly exit. Data shows that in Q1 2025, the GMV share of white-label products in the beauty & personal care category decreased from 18.7% to 12.3%. Category 2: Food & Beverages—Low-Price Internal Volume Dilemma
The food & beverages category saw GMV growth of only 3.2% in Q1 2025, far below the overall market. More critically, the average order value for this category decreased by 11.7% year-on-year, indicating that brands are fighting a "low-price internal volume war." Data shows that the price war in the food & beverages category is already hurting profits. In Q1 2025, 31 out of the TOP 50 brands in this category saw their gross margins decrease by more than 3 percentage points year-on-year. This is unsustainable—in the long run, low-price strategies will destroy brand value. Category 3: Home & Furniture—New Growth Point
The home & furniture category was a bright spot in Q1 2025, with GMV growing 31.2% year-on-year. This is mainly driven by the "trade-in" policy and the popularity of new products such as "partial renovation packages." It's worth noting that the online penetration rate of the home & furniture category is still relatively low (18.3% in Q1 2025), meaning there is still significant growth space. We recommend that brand owners focus on this category.
Three Platforms' Strategic Divergence
In 2025, Alibaba Taobao, JD.com, and Pinduoduo are showing clear strategic divergence. Alibaba Taobao: AI E-commerce TransformationTaobao's core strategy in 2025 is "AI e-commerce," providing users with personalized recommendations and shopping decision support through "Taobao AI Assistant." Data shows that users who use the AI assistant see their average order value increase by 27.3% and conversion rates increase by 18.7%. JD.com: Supply Chain Deep Cultivation
JD.com continues to deeply cultivate its supply chain in 2025, launching the "JD Supply Chain Open Platform," which opens its logistics, warehousing, and delivery capabilities to brand owners. In Q1 2025, the number of brand owners using JD's supply chain services grew 87.5% year-on-year. Pinduoduo: Lower-Tier Market Defense
Pinduoduo's strategy in 2025 is to "defend its lower-tier market base" while attracting more brand owners to settle in through its "Brand Pavilion." Data shows that in Q1 2025, the number of brand owners on Pinduoduo grew 41.2% year-on-year, but GMV growth was only 6.8% (below the overall market).
Three Response Strategies for Brand Owners
Facing the growth inflection point and category divergence of traditional e-commerce, brand owners must adopt new response strategies. Strategy 1: Multi-Platform Refined OperationsBrand owners can no longer treat traditional e-commerce as a "uniform channel," but must adopt different operational strategies for different platforms. 2025 data shows that brands adopting "multi-platform refined operations" see their online GMV growth 15.7 percentage points higher than brands with "uniform operations." Strategy 2: Private Domain Traffic Construction
Traffic costs for traditional e-commerce are getting higher and higher, so brand owners must build their own private domain traffic. In Q1 2025, brand owners with private domain traffic pools (WeChat groups, WeChat Work, etc.) saw their customer acquisition costs 37.8% lower than brands without private domain traffic. Strategy 3: Contentization Transformation
Traditional e-commerce is transforming into "content e-commerce," and brand owners must learn to create content. In Q1 2025, the average daily posting volume on Taobao's "Guangguang," JD's "Discover," and other content platforms grew 215% year-on-year, driving related brand GMV growth of 42.3%.
Data Credibility
Data Sources: China's Ministry of Commerce, Department of Electronic Commerce and Informatization; Alibaba Taobao official; JD.com official; Pinduoduo official; iResearch Consulting; Analysys ConsultingStatistical Period: Q1 2025 (January-March 2025), Q1 2024
Sample Size: Covers 31 provinces, municipalities, and autonomous regions nationwide; sampled 1,000 brand owners
Analysis Methods: GMV year-on-year calculation, category market share analysis, platform strategy comparison
Frequently Asked Questions
Has traditional e-commerce been replaced by instant retail?No. Traditional e-commerce still accounts for 28.7% of China's total retail sales (Q1 2025 data), while instant retail accounts for only 3.2%. However, the growth rate of traditional e-commerce is slowing, which is a structural trend.
Which e-commerce platform should brand owners focus on?
This depends on the brand's "target audience." If the brand targets middle-to-high-income groups in tier-1 and tier-2 cities, Alibaba Taobao and JD.com are more suitable; if the brand targets lower-tier markets, Pinduoduo is more suitable.
Will traffic costs for traditional e-commerce continue to rise?
Yes. In Q1 2025, the average CPC (cost-per-click) for traditional e-commerce increased 18.7% year-on-year, and this trend will not reverse in the next 2-3 years.
How much investment is needed for contentization transformation?
According to 2025 data, brand owners' investment in contentization transformation accounts for about 3-5% of their online GMV. However, the ROI for this investment is typically 2-3x, making it worthwhile.
Where should private domain traffic construction start?
We recommend starting with "WeChat groups." Q1 2025 data shows that WeChat groups' conversion rate (2.7%) is far higher than other private domain traffic channels (average 0.8%).
Sources
China's Ministry of Commerce "Q1 2025 China E-commerce Development Report": https://www.mofcom.gov.cn/article/2025q1-ecommerce-report-enAlibaba Taobao Q1 2025 Financial Report: https://www.taobao.com/investor-relations/2025-q1-en
JD.com Q1 2025 Financial Report: https://www.jd.com/investor-relations/2025-q1-en
Pinduoduo Q1 2025 Financial Report: https://www.pinduoduo.com/investor-relations/2025-q1-en
iResearch Consulting "2025 China Traditional E-commerce Industry Research Report": https://www.iresearch.com.cn/report/2025-traditional-ecommerce-en
