Why social commerce thrives in China but struggles to scale in India

The big question is: will it deliver over the next few years?

Social commerce broadly takes three forms: livestream selling, influencer-led discovery and group buying. Livestreaming implies an influencer broadcasting a live video with their followers, allowing viewers to watch, interact and shop while the stream is happening. According to the Economist, nearly half of the internet users in China watch livestreaming, amounting to over 500 million people. Selling via influencers on social media (e.g., Douyin, TikTok’s sister app in China) is quite popular these days, especially on platforms like Instagram and YouTube. Group buying implies consumers making a purchase as a group, getting better deals in the bargain. For instance, Pinduoduo, a group buying-oriented social commerce firm from China, has a market capitalization in excess of $170 billion.

Globally, the social commerce market size was estimated to be over $1.6 trillion in 2025, and is projected to grow at over 30% CAGR every year till 2030, according to a report by Grand View Research. One of the biggest markets globally is China, and according to the Economist, China accounts for nearly $900 billion of social commerce revenue representing 30% of all e-commerce revenue in China.

For the past few years, social commerce has been pitched in Indian boardrooms as the next China-sized gold rush. Yet, despite the hype, India remains more a spectator than a participant, and social commerce has yet to realise its full potential in the country.

The big question is: will it deliver over the next few years?

Social commerce

Social commerce broadly takes three forms: livestream selling, influencer-led discovery and group buying. Livestreaming implies an influencer broadcasting a live video with their followers, allowing viewers to watch, interact and shop while the stream is happening. According to the Economist, nearly half of the internet users in China watch livestreaming, amounting to over 500 million people. Selling via influencers on social media (e.g., Douyin, TikTok’s sister app in China) is quite popular these days, especially on platforms like Instagram and YouTube. Group buying implies consumers making a purchase as a group, getting better deals in the bargain. For instance, Pinduoduo, a group buying-oriented social commerce firm from China, has a market capitalization in excess of $170 billion.

Globally, the social commerce market size was estimated to be over $1.6 trillion in 2025, and is projected to grow at over 30% CAGR every year till 2030, according to a report by Grand View Research. One of the biggest markets globally is China, and according to the Economist, China accounts for nearly $900 billion of social commerce revenue representing 30% of all e-commerce revenue in China.

Some of the drivers for the incredible growth of social commerce include smartphone and internet penetration, socially cohesive cultures and high population density. A big reason for the scale-up of social commerce is also the frictionless large scale presence of the super-app WeChat, which has over 1.3 billion monthly active users.

The social commerce opportunity in India has been a disappointment. According to RedSeer, as of 2025, the social commerce market was still a very small fraction of the global market. In terms of contribution to e-commerce, social commerce in India accounted for 1-2% of total e-commerce revenue, compared to 20-25% in Indonesia and 30-40% in China.

However, there have been pockets of success. For instance, Myntra recently reported that it generated 10% of its revenue from social commerce powered by 3.5 million creators. Similarly, HUL is collaborating with 12,000 influencers, up from 700 last year. There has been a wave of attempts in this space from other players like Simsim, Bulbul, GlowRoad, etc. Specifically, livestreaming hasn’t picked up in India at the scale it operates in China. There are a variety of underlying drivers for this - poor internet quality (India ranks 131 globally in internet speeds), high data costs (especially in Tier 2 cities) and an initial focus by e-commerce platforms on pre-recorded content.

Meesho (founded in 2015) is often quoted as one the few success stories of social commerce in India. It has more than 50 million monthly active users, driving a gross merchandise value (GMV) of over $6 billion in FY25 with millions of resellers (primarily women) structuring social selling around personal networks. It is not yet profitable, having reported a net loss of ₹3,942 crore in FY25.

By contrast, China’s Pinduoduo (also founded in 2015) was hugely profitable in its seventh year of operation, and reported a multi-billion dollar net income from 2023. The fact that Meesho has significantly pivoted from its pure social commerce model towards a traditional e-commerce marketplace model proves that social commerce is hard in India.

Why hasn’t social commerce picked up in India? There are many reasons to explain why this model is struggling to take off.

Low Trust: The first reason is around trust - China is a high-trust society whereas India is a low-trust society. According to the World Values Survey, around 65% of people say ‘most people can be trusted’ in China, whereas only about 20% of people in India can say the same. This results in lower trust for these platforms and new-age business models. A simple application is that consumers in China pay in advance (via cards and wallets), whereas consumers in India pay once they touch and feel the product, increasing working capital issues for social commerce players.

Model Economics and Pricing: There are infrastructure issues that make this model very difficult to become viable. In India, there is customization required due to multiple local languages and cultures, large unorganized seller concentration, extreme price sensitivity and poor infrastructure connectivity. For instance, according to RedSeer, India’s retail market is expected to remain fragmented in terms of supply, with regional brands and unbranded products projected to drive more than 70% of the total retail spends. In addition, the average order size in China is 2-3X higher than India, allowing for commissions on social commerce along with making a tiny margin after returns and discounts. Since entry-level prices in India are extremely competitive, there is little room left for platforms to earn commissions after accounting for returns, discounts and other costs.

Logistics and Scale: Parcel-density in China is on average 8X, compared to those in India, making logistical viability much easier in a market like China, according to the Journal of Applied Electronic Consumer Research, China.

Preference for Cash Payments: One of the biggest pain points in India has to be frictionless payments. According to a survey by IIM Ahmedabad, nearly 65% of e-commerce purchases are still made in cash, especially in Tier-2 cities, making platform stickiness more difficult.

Regulation and Misinformation: With influencers, there is misinformation everywhere, but China and India handle it differently. There, the Cyberspace Administration of China has enforced rules that creators must provide proof of degrees, licences and certified training before posting content, especially on topics like health and medicine. Platforms like Douyin and Weibo are required to verify these credentials and ensure their information is accurate. In India, disclosure is required only when technical advice is given and not for awareness messaging. Unlike China, creators are not required to hold professional qualifications to share general information on health or financial topics. As a result of this regulation and lax implementation, there is low trust in these systems from newer consumers.

What is the way forward? Will social commerce in India grow faster than e-commerce? Probably yes, but it is on a very small base. Will it ever get to China’s maturity? Unlikely, as it needs a high-trust ecosystem with frictionless payments, homogeneity in offerings, formats that respect Indian nuances and infrastructure viability.

All of these will take at least a decade to become best-in-class.

The writer is the author of ‘How Business Storytelling Works’ and ‘Why Your Strategy Sucks’ and former global foresight leader at Mars Wrigley