Tmall Global has become the preferred platform for overseas brands to enter China.
Tmall Global is the largest cross-border e-commerce platform in China and is also regarded as the first stop for overseas brands and companies to connect with the Chinese market. As China’s online import consumption continues to gather steam, the number of Tmall Global users has snowballed to exceed 100 million1 over 2020.
The considerable consumer flow has attracted more brands’ entry. In 2020, Tmall Global has seen a nearly 200% growth rate for foreign brands’ entry, with over 400 new brands entering Tmall Global every month on average. The booming online import consumption market has also injected great impetus to the growth of these overseas brands. In 2020, Tmall Global saw double-digit growth in the number of new brands with sales exceeding 10 million and 1 million, respectively. The sales of more than 40 new brands exceeds 100 million CNY.1
In the first quarter of 2021, the new brand entry number increased 63% year-on-year. In January alone, more than 600 new brands from overseas opened stores on Tmall Global.2 Besides traditional consumer brands, overseas celebrities’ personal brands also target the lucrative Chinese market. The Grammy winner Billie Eilish is one of the latest international celebrities to plug into China’s booming e-commerce ecosystem by entering Tmall Global, following Taylor Swift, Rihanna, and Kim Kardashian.
Top-shelf international brands also proactively introduce sub-brands to the Chinese market. This month, L'Oreal Group opened its Tmall Global flagship store for its first plant essential oil skincare brand, Decleor, marking the brand’s entry into the Chinese mainland market. According to Ministry of Commerce’s report, skincare essential oil is still a relatively untapped sector in China, accounting for less than 1% of the total cosmetics market. Another L'Oreal brand, IT Cosmetics, is also expected to enter the Chinese market this month.
Many foreign brands have ridden the segmented trends emerging during the COVID-19 outbreak and achieved substantial growth. In 2020, the sales of Selsun, an Australian shampoo brand under Sanofi, rose more than 160% at Tmall Global, thanks to Chinese consumers’ increasingly sophisticated scalp care demands. The rising home professional skincare tide has also driven the growth of beauty-salon-level facial mask brands to more than 200%, including Dermalogica from the U.S., MedSPA from France, and REPACELL from Germany.
Tmall Global further upgrades its import strategy.
Tmall Global has upgraded its import strategy this March to facilitate more foreign brands’ entry into the Chinese market. Besides continuously incubating new categories, introducing new brands, and launching new products, the platform aims to open 1,000 new stores for global small and medium-sized brands in half a year and develop new import industrial belts in six comprehensive bonded zones within one year.
Tmall Globa also explores new import models to meet new domestic consumption needs. In 2020, it cooperated with Hangzhou Comprehensive Bonded Zone to create a new import model of "bonded import + retail processing". This model precipitates the sales of Malaysian bird’s nest and sees its sales reaching nearly 40,000 bottles within one month after the “bonded zone factory” put into operation. In the future, the new model will apply to more categories, including imported nuts, dried fruits, coffee and tea products.
Import consumption groups are becoming younger.
According to Tmall Global, in the past year, the number of cross-border online shopping consumers born in the 2000s grew by nearly 70% year-on-year, recording the fastest growth rate compared with other consumer groups, and expecting to become the largest consumer group in the years going ahead.
The post-2000 grew up in the era of globalization, with a broader vision to explore and try new things. Their distinct characters give rise to the popularity of many niche brands that could represent and speak for their values and emotions.
Besides pursuing value recognition and self-gratification, they also seek to create a better life for their families and pets, thus bringing opportunities to Tmall Global by introducing more personalized brands.