China has birthed many of the world’s leading online marketplaces, as well as a wave of fast-growing challengers. Intense competition and slowing growth at home have pushed these retailers to seek new opportunities abroad, but aggressive US trade policies now threaten their expansion. As a result, China-affiliated marketplaces are recalibrating. This briefing examines how these players are navigating a rapidly evolving global trade environment and responding to external pressures.
Delivery
This report comes in PPT.
Key findings
The new Trump tariff regime creates major challenges for cross-border retail
The Trump administration’s 2025 revocation of the de minimis tariff exemption for imports from all countries into the US complicates the outlook for online marketplaces that source the lion’s share of products they sell into the US from overseas – especially those China-affiliated marketplaces that have looked to the US to fuel their continued expansion in the face of slowing growth at home.
China-affiliated marketplaces must rethink their US strategies
In response to the end of the de minimis tariff exemption, China-affiliated marketplaces are overhauling their US strategies – by lowering prices, onboarding US sellers, rethinking supply chains, and leaning into the value they provide beyond simply offering low prices.
China-affiliated marketplaces are looking beyond the US
While marketplace operators are loath to abandon the US entirely, the Trump tariffs are leading to a reprioritisation of other markets. As a result, many of these players are now actively working to boost their businesses outside of North America, especially in Europe and Asia Pacific.
Marketplaces are attempting to diversify beyond their core retail operations
As cross-border e-commerce becomes more constrained, China-affiliated marketplace operators increasingly seek to establish revenue streams beyond retail. A few of the leading players are succeeding by building out their businesses in sectors like advertising, ancillary services, and AI.
Protectionism is spreading around the globe
The Trump administration’s aggressive approach to tariffs is leading other markets to rethink their own trade policies. As a result, many countries are making life tougher for China-affiliated marketplaces. These retailers must rethink their strategies and shore up their value propositions.
Why read this report?
Key findings
The Trump administration’s tariff policies impede marketplace e-commerce growth
Marketplace e-commerce revolutionises global retail
Chinese marketplace giants face new obstacles to their global expansion in 2025
The marketplace boom reshapes Chinese retail
Upstarts undercut the dominance of China’s marketplace duopoly
Douyin revolutionises marketplace e-commerce in China
Chinese marketplaces turn to international markets in the pursuit of growth
Temu expands its global reach with its discount-focused third-party marketplace
Chinese marketplace operators conquer the world
Chinese players power the third-party marketplace model to new global heights
China and the US serve as the twin engines of cross-border retail e-commerce
The US’s de minimis tariff exemption comes to a shocking end
Marketplaces’ supply chain strategies are in disarray
Shein tries and fails – to circumvent US customs duties
China-affiliated retailers that made their name on low prices see US sales plummet
China-affiliated marketplaces are forced to rethink their US strategies
Temu reimagines its US supply chain
TikTok Shop thrives in the US even as its future remains uncertain
Name brands are powering TikTok Shop’s US sales to new heights in 2025
Trump’s tariffs could give some US-based retailers a leg up in their home market
China-affiliated marketplaces are increasingly prioritising countries other than the US
Alibaba’s global strategy relies far less on the US than other marketplace operators do
Marketplace operators’ international expansion faces new obstacles
Marketplaces are finding ways to generate revenue outside of their core retail operations
Shein launches a “manufacturing-as-a-service” initiative to find new sources of growth
China-affiliated marketplaces face an uncertain future as online sales growth slows
Recommendations for growth
Evolution of cross-border marketplace e-commerce
Questions we are asking
Channels: Helping you understand where and how consumers shop
Retail
Retail is the sale of new and used goods to consumers from a business for personal or household consumption from retail outlets, kiosks, market stalls, vending, direct selling and e-commerce. Retail is the aggregation of Retail Offline and Retail E-Commerce. Excludes specialist retailers of motor vehicles, motorcycles, vehicle parts. Also excludes fuel sales, foodservice sales, rental transactions, and wholesale sales (e.g. Cash and Carry). Sales value excluding or including VAT/Sales Tax. Retail also excludes the informal retail sector. Informal retailing is retail trade which is not declared to the tax authorities. Informal retailing encompasses (a) sales generated by unregistered and unlicensed retailers, i.e. retailers operating illegally, and (b) any proportion of sales generated by a registered and licensed retailer that is not declared to the tax authorities. Unregistered and unlicensed retailers operate predominantly (although not exclusively) as street hawkers or operate open market stalls, as these channels are harder for the authorities to monitor than permanent outlets. Activities in the illegal market, which is usually understood to refer to trade in illegal, counterfeit or stolen merchandise, are included within our definition of informal retailing. Activities in the “grey market”, which is usually understood to refer to trade in legal merchandise that is sold through unauthorized channels – for example cigarettes bought legally in another country, legally imported, but sold at lower prices than in authorized channels – will be included as informal retailing if no tax is paid on sale by the retailer. However if the retailer pays tax – for example on cigarettes bought legally in another country but sold at a lower price than standard – the sale is included within formal retail.
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