To start out in China, you have to know that Chinese ecommerce is dominated by Alibaba–which runs Tmall, Tmall Global and Taobao. Tmall Global is the cross-border version of the marketplace and attracts affluent consumers who are most interested in buying Western products.
In this blog, we’ll take you through some of the key questions brands ask about launching in China, from considering whether your brand is right for the marketplace, to navigating zero brand awareness in China, and finally understanding the annual Tmall trading cadence for a global consumer brand.
Is your brand right for Tmall Global?
While launching in new markets such as China may seem an attractive option for brands looking to grow their international presence, it is important to determine whether your brand is right for Tmall Global. Here are three things we recommend brands consider as part of their risk and reward analysis prior to launch:
1. How big is the market opportunity and how intense is the competition?
Highly niche subcategories may mean less competition, but the market opportunity may also be limited. Brands should analyze the products that are selling well in their category to understand why customers prefer them. This information can help a brand establish which products to sell to achieve fair share on the new marketplace.
2. Tmall prefers brands that already have awareness in China
Brands should carry out thorough searches on popular Chinese social media platforms such as Taobao and Baidu to assess how much brand awareness there is for your brand currently. It may also be a good idea to learn how much awareness competitors have, so you have a better idea what kind of race you are getting into.
3. Invest in demand generation for at least a year before selling on Tmall
A brand entering China on Tmall with low brand awareness will need to spend up to 30% of its projected sales on marketing; with a mix of about 10% on Tmall marketing and up to 20% on other channels.
What if I have zero brand awareness in China?
Given that Tmall only wants to work with brands that already have awareness in the market, building your brand awareness pre-launch is crucial for success. Additionally, launching on Tmall when the brand has low brand awareness in China is difficult and costly.
Being from the states, and even having the pedigree of the brand being manufactured in the West is no longer enough to achieve sales. Strong local brands as well as established Western peers will provide tough competition, and significant investment in Chinese social media platforms and the use of KOL marketing can help to build trust amongst shoppers.
What are the key trading dates for brands selling on Tmall?
To deliver profitable promotions that tempt existing and new customers, you must understand the trading cadence in China, and how it substantially differs from that of the West. There are several important promotional trading periods, shown below, which should be used to test promotions and also to establish credibility with customers and Tmall.
The main promotional periods earlier in the year will determine whether you are invited to participate in Tmall’s official Double 11 activity. Performance in 618 Festival in June is the biggest indicator of success for Double 11. You should not consider each promotional event in your calendar in isolation. Chinese consumers expect to see the biggest discounts and special offers for Double 11, so ensure you keep your best offers for that time.
Want to learn more about successfully launching your brand on Tmall Global?
Watch our on-demand webinar, where we discuss key components to prepare for branching into the China market, launching onto Tmall, marketing techniques on both Tmall and other external drivers, trading and marketing KPIs, and finding the right trade partner.
Pattern is a Tmall 5* Trade Partner, and provides full-service support on everything from market entry strategy, Tmall Flagship Store set-up and the ongoing operation, to the marketing and trading of your Tmall store.
We also act as a Trade Partner for JD.com, WeChat, Pinduoduo and Koala. For brands looking for a wider presence across Asia Pacific, we can support your launch on Lazada, Coupang, Shopee and Amazon.jp.
Get in touch now to discuss how we could support your Tmall sales or help solve other ecommerce and marketplace challenges that you face.