Tmall (天猫), Alibaba’s solution to the consumer trust issues that previously held China’s eCommerce industry back, was launched in April 2008. It now houses 70,000 International and Chinese brands within its online ‘mall’ interface. It is China’s and now one of the world’s largest B2C eCommerce platforms. This extraordinary growth is somewhat down to the Alibaba’s seal of authenticity placed on any product for sale in a Tmall store. Examples of brands available to consumers, direct from brand owners, on Tmall range from Burberry, Nike and Apple Inc. to GNC, L’Oreal and Clinique.
A shocking homage to the power of the all mighty Tmall was revealed late last week when Amazon launched an on Tmall. Whilst Amazon dominates eCommerce markets around the world, at the end of Q4 2014, it stood with only 1.3 percent of the Chinese eCommerce market share in terms of transaction value. This is according to data from iResearch.
The advantages of taking your brand onto Tmall goes far beyond rubbing shoulders with the world’s largest and most prestigious brands and placing your products in front of the hundreds of millions of ‘reassured’ and recently affluent consumers. The Tmall platform works harder than that for its brands – Merchants selling through Tmall enjoy exclusive promotional and marketing opportunities. Integrations with Weibo and WeChat, aall opening up brand led communities and engagement opportunities. Alibaba also addresses another of China’s key barriers to entry for international brands, an integrated payment gateway. Working with Tmall allows for a seamless integration with Alipay and its 300,000,000 active users.
Before opening your store on Tmall you need to decide upon a strategy as this affects your choice of store. The available store types are Flagship Store, Authorised Store and a Speciality Store.
A Flagship Store gives brands a direct line into Tmalls huge and active Chinese consumer base.
To open this type of store the merchant must be the brand and trademark owner, or must at least possess exclusive authorisation from the brand and trademark owner(s) to trade the brand in China. There is further criteria to adhere to –
- The store will only sell and act on behalf of a single brand
- The store can sell and act on the behalf of multiple brands that are all owned by the brand. This requires additional approval from Tmall
- The store can sell and act on behalf of a multi-brand marketplace (service class trademark) all owned by the merchant opening the store. This requires additional approval from Tmall
Burberry were the first global luxury fashion brand to open a flagship store on Tmall. Their bold move showed the luxury sector that you do in fact have complete control of your brand equity, pricing and marketing message on Tmall, much like opening a bricks and mortar store within a real mall. It has subsequently opened the floodgates for foreign brands opening flagship stores on Tmall.
User feedback on Tmall suggests that Nike’s Flagship Store is by far the most popular international brand store with the platforms customer base, citing speed of shipment, usability of the store and the products available.
The name of this type of Tmall store speaks for itself. To open an Authorised Store the merchant must submit the required authorisation documents from the owner of the brand and trademark. Authorised stores may be opened under the following circumstances –
- The store is authorised to sell products from one brand
- The store is authorised to sell products from multiple brands, so long as all brands belong to the same entity.
In this circumstance ‘speciality’ refers to a store that specialises in a specific product category, such as shoes or consumer electronics. This type of store allows the merchant to sell products of two or more brands that belong to the same product category. A Speciality Store may be opened under the following circumstances –
- Store can sell products from two or more brands that the merchant doesn’t own
- Store can sell products from brands owned by the merchant as well as brands that are not owned by the merchant
- Store can sell products from two or more brands that the merchant owns
It is important to know that a merchant may only open one Speciality Store within a single product category.
Next week I will discuss the timelines, costs and requirements to open your chosen type of Tmall store as well as highlighting the in-platform marketing channels available to merchants.