Overseas markets face a challenging business environment. Many companies are looking to China for growth. Alibaba, China’s pre-eminent e-commerce company, wants to help high-quality overseas brands make the leap.
Alibaba’s cross-border e-commerce marketplace, Tmall Global, announced plans to bring 1,000 new overseas brands onto its e-commerce platform over the next 12 months. This plan falls under Alibaba’s $200 billion, five-year-import program. This was announced during the China International Import Expo in Shanghai in 2018. It’s a huge commitment focused on getting the best the world has to offer to Chinese consumers.
So, what does incubation mean for overseas brands?
First, it offers a bigger toolbox. Tmall Global will offer incubated brands a series of tools, incentives and campaigns to help them flourish in China.
You read that right – Alibaba’s looking to give these brands an unfair advantage. To top it off, that unfair advantage gets bigger the better a new brand performs. Companies that hit pre-agreed targets receive a whole bunch of benefits – like a reduction in platform fees, and the opportunity to participate in special events and programs, like e-commerce festivals.
If you’re looking for a capable partner that’s up to the challenge of making your brand go places in China, then let’s get in touch.
Second, it offers speed to market. Incubated brands will have access to English-language customer service and self-registration which allows brands to get up and running inside 30 days.
Third, it offers return on investment. Tmall Global aims to help each new brand make RMB 1 million in its first 90 days. Last year, Tmall Global piloted the incubation program with brands like Fenty Beauty, DPC and Brandfree. Top sellers were in the cosmetics, medical care and personal care product categories.
Prior to this initiative, Tmall has a track record of incubation to meet the needs of its 670 million customers. For instance, Tmall’s Innovation Centre and Tmall’s watch division developed a report on China’s wristwatch market. Based on the report’s findings, Tmall invited 50 young designers to create 600 designs. Of these, 50 were selected for concept testing with a small group of shoppers. 17 designs were taken up by 10 Chinese watch brands — including Wussa, Geya, and Jonas & Verus and were launched during Singles Day, the biggest e-commerce event of the year.
Does this sound like something you’re interested in?
If you’ve got a brand worthy of incubation, drop us a note to assess your brand strength and market entry possibilities. We’re always on the lookout for top talent, and we’re excited to connect brands with the China market.
Let’s get in touch.