To understand the background and various apps with the Alibaba eco-system, read our previous interview with Mei Chen, and our discussion with Ada Xu, all about Alibaba’s travel app, Fliggy.
If getting on Tmall Global is a brand’s first step in China D2C – what next? To find out, we spoke with Chloe Goncalves, Senior Business Development Manager at Tmall Global, looking more at the ‘how’.
Tmall began as an e-commerce, sales platform. What is it today? What are some of the ways that brands best use the platform to stand out to their audience?
Tmall offers a wide range of services for brands, but it is very important to understand the “social” aspect of the platform.
Consumers in Europe shop online as a way to save time, whereas in China, consumers use Tmall as a way to spend time. On average, consumers open the Tmall and Taobao apps 7 times per day for about 20-30 minutes, with approximately 20 million comments shared daily.
The Taobao and Tmall apps are much more than that; they are a part of Chinese consumers’ everyday lives. Consumers have access to a wide range of content – from short videos, livestreaming, blogger recommendations, product showcases – all of which allows them to browse, learn, discover, share and interact directly with brands.
Via Tmall, brands have access to innovative digital tools, such as 3D stores or livestreaming, allowing them to create engaging and tailored shopping experiences.
A recent example of this is IKEA, which launched a 3D virtual allow consumers to visit and discover 3,800 popular products and furnishing solutions.
Another key development of Tmall, is the “Tmall Innovation Center” (TMIC). Established in 2017, TMIC uses insights from consumers to help brands develop, design and market new products specifically for Chinese consumers.
Our partnership with brands is not limited to just selling their products, however, we also work to help them develop new products for the China market.
TMIC leverages Chinese consumer insights to develop products specifically for the China market. To give an example, we partnered with Mars to launch a spicy flavoured Snickers chocolate bar as data, taken from TMIC, showed it would be a popular flavour for Chinese consumers.
In such a competitive market, of course simply ‘being on Tmall’ alone isn’t what a brand needs to see as an achievement. What can they do within Tmall as a kind of ‘best practice’?
Brands need to have a multi-channel content strategy to engage, excite and educate their customers about the key value propositions of their brand. China is a competitive market and the consumer is highly sophisticated – they are curious and want to learn about the brands they are interested in.
Beyond that, brands also need to offer personalised website homepages to cater to the different customers demographics. Tmall effectively acts as a search engine for consumers – they need to be able to find all the information about your brand/product.
Another important function is the Customer Service team. Many consumers will first talk to the shop online assistant before making a purchase, so they play an important role in the shopping experience.
Looking at upcoming trends, what are Chinese consumers searching for?
Demand for imported goods has remained high. Data from Tmall Global – Alibaba’s cross-border e-commerce platform – shows that purchases of goods from overseas were up 40% year on year in the last quarter.
Key growth categories include Beauty & Personal Care, Mother & Baby and Health & Wellness. Popular products within these categories include organic products and nutritional supplements, probiotics, meal replacements and the rise of the ‘healthy beauty’ trend.
Another key trend we have seen over the past few years are customers’ needs evolving from basic daily necessities products like cosmetics and infant formula, to diversified lifestyle products such as anti-hair loss, maternity care and pet-related products.
For example, the niche category of make up for pregnant women has grown by 360% this year, this is much higher than any other maternity related products.
Looking at beauty, niche brands tend to do very well in China as consumers are always looking for new and unique products. A great example of this is maternity brand Ilado – its pregnancy necklaces that were new to the China market have helped this brand grow rapidly. Since opening its first store in 2018, its sales have grown and China now accounts for 40% of its sales.
How do you set the tone for what an international business can expect as they enter the China market?
China can seem a distant and daunting market for European businesses, but demand for international brands is high and the opportunity for growth is strong.
There really is no such thing as ‘too small’ for China – a product that might seem like a niche market in a brand’s home territory, or in another smaller market, can quickly become a significant and realisable opportunity when it aligns with consumer demand and meets the scale of the audience in China.
Like any new opportunity, brands must properly educate themselves and understand how to market themselves effectively – a ‘one size fits all’ strategy will not work in China. Take Chinese luxury consumers, for example – they are on average at least 10 years younger than their European counterparts.
Our advice for brands is to first do the research in order to identify and understand their consumers completely – and then create a fully localised content strategy.
