Tmall Global’s sales rose ten­fold in 2014

China Daily (Canada) - - ACROSSAMERICAS - BY LIAN ZI in San Francisco zil­ian@chi­nadai­lyusa.com

China has seen a surge in cross-bor­der e-com­merce, as mil­lions of Chi­nese on­line shop­pers buy prod­ucts di­rectly from for­eign web­sites, some­times through on­line mar­ket­places such as Alibaba’s Tmall Global.

Tmall Global, an ex­ten­sion of Tmall.com that en­ables com­pa­nies based out­side China to di­rectly sell prod­ucts to Chi­nese con­sumers, an­nounced on Mon­day that its to­tal gross mer­chan­dise vol­ume (GMV) has in­creased 10 times since its launch in Fe­bru­ary.

The company de­clined to dis­close spe­cific fi­nan­cial num­bers.

Tmall Global was cre­ated to serve Chi­nese con­sumers seek­ing high-qual­ity prod­ucts di­rectly from over­seas.

The ris­ing spend­ing power of Chi­nese con­sumers is cre­at­ing a tremen­dous op­por­tu­nity for Western re­tail­ers, Sherri Wu, head of in­ter­na­tional business de­vel­op­ment, Amer­i­cas, and vice-gen­eral man­ager of cross- bor­der business for Alibaba Group Hold­ing Ltd, told China Daily.

“Since launch­ing, Tmall Global has been re­ceiv­ing strong de­mand from global brands that want to ramp up their par­tic­i­pa­tion on the plat­form in or­der to ride a wave of grow­ing de­mand for im­ported goods amongst Chi­nese con­sumers,” said Wu.

There are 5,400 for­eign brands sell­ing prod­ucts on Tmall Global, ac­cord­ing to the company.

The most popular prod­uct cat­e­gories on Tmall Global are food, cos­met­ics, ma­ter­nal prod­ucts, health sup­ple­ments, daily ne­ces­si­ties and small elec­tronic ap­pli­ances, ac­cord­ing to Alibaba.

Tmall Global mer­chants could ben­e­fit from the large vis­i­tor traf­fic as prod­uct list­ings, search re­sults and traf­fic shared through all of Alibaba’s China re­tail mar­ket­places, in­clud­ing Taobao and Tmall, reached 307 mil­lion ac­tive buy­ers in the 12 months ended Sept 30, Wu said.

Costco Whole­sale Corp, the US ware­house chain that launched its Tmall Global store in Oc­to­ber, rang up more than $6.4 mil­lion in sales in the first month. Dur­ing “11.11”, China’s Sin­gles Day shop­ping fes­ti­val, Costco sold about $3.5 mil­lion in mer­chan­dise in 24 hours, in­clud­ing 300 tons of mixed nuts and dry cran­ber­ries.

“Our per­for­mance on Sin­gles Day shocked and sur­prised our man­age­ment, and it to­tally trans­formed our an­nual business plan,” the company said in a state­ment. “In 2015, we hope to of­fer Chi­nese con­sumers a richer va­ri­ety of prod­ucts through the plat­form and also im­prove their over­all shop­ping ex­pe­ri­ence.”

Na­ture’s Bounty, an Amer­i­can man­u­fac­turer of vi­ta­mins and nu­tri­tional sup­ple­ments that opened its Tmall Global store­front in Au­gust, sold $700,000 in goods through the plat­form in Novem­ber, ac­cord­ing to Alibaba data.

“What we re­al­ized was that there’s that group of very ed­u­cated Chi­nese con­sumers look­ing for us, es­pe­cially some of our hero prod­ucts that have sold well in the U.S. mar­ket,” the company said. “You just can’t re­ally find any other plat­form that would pro­vide you such growth op­por­tu­ni­ties … we will fo­cus on Tmall Global as the main place to tap into the China mar­ket.”

Wu also shared Tmall Global’s plan for the com­ing year.

“The US will be one of the key mar­kets for Tmall Global in 2015,” Wu said. “We are ded­i­cated to sup­port­ing US busi­nesses to un­der­stand and ef­fec­tively reach China’s 330 mil­lion on­line con­sumers.”

Alibaba open­ing Tmall Global gives Chi­nese con­sumers more ac­cess to for­eign goods and pro­vides for­eign com­pa­nies so­lu­tions to the Chi­nese mar­ket, said Jonathan Li, CEO of the mu­sic and pic­ture-shar­ing site Vibin, which just ex­panded into China’s e-com­merce mar­ket.

Li said it was dif­fi­cult to es­ti­mate how long the growth will last and whether it will be af­fected by any new eco­nomic poli­cies in the com­ing year.

“If the Chi­nese gov­ern­ment finds that for­eign busi­nesses are do­ing too well on Tmall, then there may be some lim­its or taxes ap­plied to bet­ter pro­tect do­mes­tic com­pa­nies,” Li told China Daily. “Un­less Alibaba finds new un­tapped users, I don’t ex­pect another ten­fold in­crease next year.

LONG WEI / FOR CHINA DAILY

A Tmall logo made from Lego bricks is dis­played in Hangzhou, the head­quar­ters of Alibaba Group Hold­ing Ltd.

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