What is Tmall Global – A Guide on How to Open Your Store
Tmall Global, as one of the most popular cross-border e-commerce(CBEC), still achieve great success in the past 2017. In the last quarter, Tmall ranked the first in the CBEC market with a 27.6% market share. Besides, Kaola.com and JD Worldwide ranked second and third respectively. The Top three CBEC’s market share has exceeded 60% of the whole market. In 2018, Tmall Global is still a great chance you can’t miss.
What’s Tmall Global?
Tmall(named as Taobao Mall before) is a Chinese-language website for business-to-consumer (B2C) online retail, spun off from Taobao, operated in China by Alibaba Group. It is a platform for Chinese consumers to buy domestic goods.
Tmall Global is a significant step for Alibaba in cross-border e-commerce. Alibaba group officially launched it on February 19, 2014. It’s mainly for international businesses to sell brand name goods directly to Chinese consumers. The goods on Tmall Global are mainly imported. Up to 2017, it has covered 68 countries and districts, with more than 3,700 kinds of products and 16,400 overseas brands.
Why more and more Chinese buyers purchase imported goods?
Nowadays, as people’s income increase, they can buy more expensive goods. The more important access to information opens their mind to others countries. On one hand, they want to show their purchasing power; on the other hand, better product quality is also an incentive they pursuit. As a result, the import consumption is normalized and become a habit for most customers. The buyers repeating purchase plays a dominant role in Tmall Global. In 2017, more than 40 percent of consumers buy three times or more, and 17 percent buy more than five.
What do Chinese buyers purchase on Tmall Global?
Consumers are keen to buy health care products and baby food in the United States, Australia, and Germany, and prefer to purchase skincare products in Japan and South Korea. In addition to Japan, the US, Australia and other favorite traditional countries, sales in niche countries are also growing fast. For example, products in areas such as Greek, Chile, Poland are popular.
Beauty skin care products are becoming the main consumption objects, accounting for 30 percent of Tmall Global’s total sales. Among them, Skin Care and Colour Cosmetics products are the highest sales products under this category.
Apart from that, due to Tmall Global double 11 activity and the entry of new overseas brands, the import Health Care Products and Medicines sales also increased a lot in 2017. Consumers are becoming more and more diverse in their health claims.
Who are the main consumers in Tmall Global?
Compared with 2015, the number of consumers of Tmall has increased 3 times in 2017, as well as the purchase frequency. The post-90s and post-95s consumers and consumption amount increased year by year. In 2017, the number of these two generations is nearly 50% in Tmall Global, with a 40% consumption amount. Young generations become the new force of Tmall Global.
Due to their passion for trying new things, especially the newest products and brands all around the world, they also become the main force of the sales growth in many small countries. Besides, compared with the consumers form the other age group, the post-90s, and post-95s have more keen to try popular foods. For example, Korea’s Turkey noodles experienced a sale surge in Tmall Global last year.
The Merchant in Tmall Global
All the companies in Tmall Global are corporate entitles outside mainland China, with overseas retail qualification. The goods sold on Tmall Global are produced initially or sold overseas and imported legally. All Tmall Global shops are equipped with Chinese inquiry service and after-sales services. Domestic consumers can use Alipay or other methods that can be used on the domestic platform, Taobao, to buy goods on Tmall Global.
On June 24, 2015, after launching the first national pavilion in Korea, Tmall Global launched the “global village” program. Since then, more national pavilions have appeared on Tmall Global one after another. Up to now, there are 17 national pavilions on Tmall Global. The countries represented through these pavilions are the United State pavilions are expected to be launched.
The strategy of Tmall Global is to be international and attract more global brands. For some foreign brands which are unable to open their own retail store in China, joining Tmall Global is a good way to reach their target, Chinese customer. Some examples of companies that have entered the China market through Tmall Global are Lush, Cambridge satchel, and Japanese drugstore brands.
Because of many factors such as tax and transportation expenses, most products on Tmall Global are typically more expensive. Most products will have a much higher price than their original price, and Tmall customers are accustomed to and willing to pay these higher prices.
-The Logistics Distribution
For Logistics Distribution, Tmall Global requires the merchant to complete the delivery within 120 hours and for the product to arrive within 14 working days. Logistics information must be trackable throughout the length of the process. This shows Tmall Global’s commitment to providing a quality user experience in order to retain its customer base.
Up to now, most of the products don’t require the support of returns, unless it is explicitly the merchant’s fault, such as delivering the wrong size or color of clothing. If consumers insist on returning the goods, they have to undertake a considerable amount of delivery and tax fee. Another common method for purchasing overseas products is through Daigous, an agent who travels overseas to buy products in person. These agents also don’t support refunds/returns, so this is not a huge weakness for Tmall Global when compared to other purchasing methods.
How to open your store in Tmall Global?
Tmall Global does not authorize any institution as the agency for the recruitment of merchants temporarily. Please refer to the official merchant attraction webpage for application procedures and appropriate charge descriptions. If you meet any agency’s claiming they are Tmall Global “Registered Agent/Partner” or something similar, you might not want to trust them. While they might have connections to the Tmall Global team there is no official status as a “registered partner” or anything similar.
Instructions on investment attraction:
- Currently, Tmall Global takes the initiative to attract investment. This means that Tmall Global invites brands of their own volition to enter the Tmall Global marketplace. While this is their official policy, if you are interested in opening a Tmall Global store you’ll need to reach out to them directly to bring your brand/store to their attention. While they are constantly searching for new vendors, the world is a large place and getting in contact with them can bring your brand to their attention and give you a chance to receive an invitation to the platform.
- The store running entity needs to be an overseas entity company. This is absolutely necessary. Tmall Global only allows overseas brands to list their products on the platform. If you are a domestic player, you’ll have to head over to Tmall/Taobao.
- Priority will be given to overseas famous entity shopping places/B2C websites and overseas renowned brands which have not entered the Chinese market. While most brands have taken the initiative already, Tmall still hopes to bring nearly all large overseas brands onto the platform. If you have impressive sales figures and believe your product is a fit for the market, get in contact with their merchant recruitment team, and they will likely extend an invitation to the platform for you.
Type of Tmall Global store
1. Brand flagship store
Private brands or the brands of which the trademark owners directly provide exclusive authorization will be considered Brand Flagship Stores on Tmall Global.
In principle, the brand flagship store can only sell commodities under its corresponding brand; If it is a distributor brand it is able to sell products of several brands under its name. These are considered the most popular type of Tmall Global store.
2. Shopping place-type flagship store
The trademark owners of offline chain supermarkets, shopping places, or online b2C websites, or the entities of which the trademark owners directly provide exclusive authorization will be will be considered Shopping Place-Type Flagship Stores.
The store can operate commodities of several overseas brands from different industries according to its actual offline or online sales. These are highly trusted for their strong customer service and qu.
3. Exclusive store
The brand trademark owners provide store opening authorization to open a store on Tmall Global.
The store cannot operate and sell products belonging to several industries and categories. They must only sell products within their designated category.
4. Franchise store
A store that operates several brands in the same industries.
Where the store operates several categories, it shall follow the List of Commodities Permitted by Tmall Global for Cross-category Operation. Typically these stores focus on one product category with multiple brands under their management.
As the leader of the CBEC in China, Tmall Global has a great potential for development and innovation. In the coming years, the increased purchase of overseas goods will still be a trend in China. More brands and products will be introduced. If you have interest, don’t miss this opportunity. We will be keeping a close eye on the developments and trends of Tmall Global.
The Dragon Social team always stays up-to-date. If you have any questions about China marketing or the creation of some creative campaigns of your own, feel free to contact us!