If you’re looking to expand your e-commerce business in China, selling on Tmall Global is a great place to start.
According to a Gartner report, 51% of 45 top global fashion brands it tracks in an index now have an official flagship store on Tmall.
So are you wondering why Tmall is such a popular platform for big brands? And what’s the process to start selling yourself? In this blog post, we’ll dig into everything you need to know about selling on Tmall Global and success stories of how Tmall has helped brands expand in a new market.
- What is Tmall.com?
- Why China’s cross border eCommerce market is surging
- Who shops on Tmall Global?
- Shop types on Tmall
- Cost of setting up on Tmall
- How to manage shipping products on Tmall
- Go to market plan to start selling on Tmall Global
- Driving traffic to your Tmall Global store
- Top Tmall Global success stories
What is Tmall.com?
Tmall is an e-commerce platform for Chinese and international businesses to sell goods to consumers in Mainland China, Hong Kong, Macau and Taiwan.
The Alibaba group of websites – which consists of Tmall, Taobao and Aliexpress – completely dominates the e-commerce space in China with 58.2% market share.
Tmall Global is the perfect platform to get started for international brands looking to sell in China. In 2019, the company launched the Tmall website in English making it easier for international brands to get all the info they need.
The following table explains the Tmall vs. Tmall Global difference in more depth.
Why China’s cross border eCommerce market is surging
The total luxury sales on Tmall grew 46% in 2018. A new wave of millennial shoppers with spending power are demanding that foreign brands enter the Chinese eCommerce market.
Despite the current scenario, Chinese consumers are flocking online and offline retailers. In fact, brands like Chanel and Louis Vuitton are hiking prices to make up for the decrease in sales worldwide.
Who shops on Tmall Global?
60% of customers on Tmall Global are women under the age of 30. The customer profile on the website isn’t price-sensitive making it perfect for international brands.
Some of the most popular categories are health and wellness, beauty and personal care; baby and maternity.
Store types on Tmall
A store meant for a brand owner or someone who possesses exclusive authorization from the brand owner to open their storefront on Tmall
Store-type Flagship Store
Similar to a flagship store, but has multiple brands in the same store
An authorized store sells goods from a particular brand. You need authorization from the brand to open a store on Tmall
A speciality store sells products from the same category but it can be from different brands.
Requirements to open a Tmall Flagship store:
- Products must be genuine and come with a certificate of origin. They need to pass Chinese international customs and Tmall Global security
- Product descriptions and labels must be provided in Chinese
- Chinese customer support must be available
- Products should be dispatched within 120 hours and be delivered to customers within 14 days
- If you sell your goods in China, Hong Kong, and Taiwan returns must be handled in those regions
Cost of setting up on Tmall
There are several cost associated with getting started on Tmall like the initial deposit, commission and annual fee.
Store owners are required to make a deposit between $8,000 to $25,000 upon opening, depending on the chosen store type. This money will be refunded when you decide to close the store.
The annual fee charged by Tmall varies based on the product category and is usually between $5,000 to $10,000.
Tmall makes money by charging a commission on products sold. Also, the amount of commission can vary based on the product category but can be up to 5%.
You can use a Tmall Partner to manage customer service and certain other operations for you for a fee.
How to manage shipping products on Tmall
One of the first questions a brand has about getting started on Tmall is about shipping. There are 2 ways to manage shipping your product:
A great option for bigger brands is to bulk ship products to bonded warehouses in China. This reduce shipping time and cost for customers. The disadvantage is that it involves a higher setup cost.
Brands testing out Tmall and not looking to increase set up can opt for shipping directly from their location. Moreover, this means customers will have added shipping charges and longer expected delivery dates. We recommend this method for brands that are testing the market.
GTM plan to start selling on Tmall Global
There are 4 major steps to get started with setting up a storefront on Tmall:
Pre-launch Document Prep
The first step is to get all of your documents together. This includes:
- A verified Alipay cross-border escrow settlement account
- Merchant basic information form
- Brand & product category form
- A copy of valid business license
- A copy of bank statement, to confirm merchant bank account is the same as that linked to the associated Alipay account
- Proof of trademark/service mark registration in the country of business incorporation.
- A copy of the merchant’s legal representative government-issued identification document
- A copy of the designated contact person government-issued identification document
- If the merchant has obtained exclusive authorization from a brand owner to use their brand to set up an overseas flagship store on Tmall Global, the merchant will need to provide a copy of the licensing agreement
- Completed and signed Tmall Global merchant service agreement
Tmall application and launch prep
Next, you need to submit the documents and sign up for additional services needed to sell. This includes:
- Submit Tmall Global application files
- Register for an Alipay global account to handle payments
- Register for a Taobao account
- You’ll receive the store invitation code once you are approved
- Next, submit the company/brand qualifications
Tmall store setup
Lastly, it’s time to set up your store. The final steps include:
- Sign contract & register with Cainiao (the logistics company)
- Design store & upload products. The number of minimum products required differs based on the category. You can find more details about it here.
- Upload information into Cainiao system
- Ship products
From the start of the application process until the launch, the entire process can take around 90 days. Book a demo with our sales team if you need more info on getting started on Tmall Global.
Driving traffic to your Tmall Global store
Once you are ready to go live on Tmall Global, it’s time to drive traffic to your page. There are several advertising channels in China that you can use to do this.
For example, top social media platforms can be a great way of engaging with your target audience and driving sales. The channel we recommend for this is:
- Weibo ads
- WeChat KOLs (i.e. using social media influencers on the WeChat platform)
You can’t mention advertising in China without mentioning Baidu. Moreover, running ads on the search giant is one of the most cost-effective channels of making your brand presence known to consumers.
- Baidu In-feed ads
- Baidu Search ads
Lastly, short video platforms are proving to be one of the top channels to drive sales on Tmall. Our top recommendation:
Top Tmall Global success stories
Several brands have seen exploding growth since they started selling on Tmall Global. So much so that their annual reports talk about their Tmall success. Here are some top success stories for you:
The popular athletic wear brand has invested in building a Tmall and WeChat presence in China. In fact, the company considers its China investment a huge success and their e-com revenue increased over 100% in Q1 last year.
In Asia, the beauty brand’s online sales doubled led by Tmall in China. In fact, on M·A·C’s first Super Brand Day on Tmall, the most popular products sold approximately 180,000 units.
For Nestle, Singles Day 2019 was highly successful. In fact, the brand grossed hundreds of millions in sales during this shopping holiday making it one of the big winners.
The road ahead
To sum up, Tmall Global has seen significant growth in the last couple of years. With over 20,000 international brands selling on Tmall Global, it’s clear that the demand for foreign brands is not slowing down.
To succeed on Tmall, it’s crucial to have local expertise on the market. Knowledge of influencer marketing along with the top channels to drive sales to your stores will help turn your brand into a Tmall success story.