Opportunities for Small Businesses Selling to China via Taobao

July 31.2018
sell to chinese consumers alibaba taobao

Alibaba Group’s Taobao Global, a shopping platform for overseas small businesses selling to China, has pledged to incubate and support more than 365 brands by the close of the fiscal year, ending March 2019.

Launched in 2007, the platform has become a destination for increasingly sophisticated Chinese consumers looking for high-quality international goods, as well as a stepping stone into the China market for brands such as U.S. handbag maker Welden or Spanish derma-cosmetic brand MartiDerm. Small or niche businesses make up 80% of the brands on the site, generating a combined 40% in gross merchandise value (GMV). That figure is expected to grow further, Taobao Global has.

Catering to this rising demand, Taobao Global has stepped up its commitment to help similar brands, which might be influential in their local markets, but still relatively unknown in China, succeed on the platform. It will provide them with support ranging from supply-chain management to content creation to digital marketing. Prospective brands will be chosen following a review by Taobao Global of their likelihood of success in China and their respective categories.

“We hope to incubate a quality international brand a day, helping them generate more than RMB 10,000 ($1,562) in daily GMV,” and provide further support to help them maintain steady growth, said Wei Meng, head of Taobao Global.

Since kicking off incubation efforts in January, Taobao Global said it had incubated 54 brands, including skincare line The Ordinary, owned by Canadian beauty company Deciem, Italian fashion house Pinko, New Zealand luxury babywear brand Dimples by Jane Anne and Japanese beauty outfit Megami No Wakka.

Taobao Global

Product page of a Taobao Global buyer store.

Megami No Wakka introduced its Amino Oil shampoo into China last year, but its daily sales average was consistently below RMB 1,000. But after joining Taobao Global’s incubation program in March this year, Megami No Wakka was able to leverage the platform’s data-driven insights on shopping trends, search keywords and product-page layout design, as well as a network of about a dozen Taobao Global buyers, online personalities who use social media posts and livestreams to engage with and sell items to their followers, to bolster their marketing campaigns. Two months later, its shampoo and conditioner set is generating over RMB 260,000 in sales per day, the company said.

According to the latest figures from Taobao Global, the platform counts over 50,000 merchants and close to 200,000 brands. Last year, more than 2.5 billion goods from 114 different countries around the world were sold on the site. A sizable portion of those transactions are generated by the Taobao Global buyers, said Wei. There are over 15,000 buyers based in about 60 countries and regions worldwide.

“Taobao Global buyers are made up of key opinion leaders and influencers in different fields. They delve deeply into overseas lifestyles and find quality local brands,” Wei said. “At the same time, they are extremely adept in social media—having loyal followings of their own—and poised to bring brands major business opportunities.”

“We genuinely hope Taobao Global’s [incubation program] can help discover and support international brands with potential flourish in China,” she added. “We want to be the top destination for SMEs looking to enter this market.”

Source: Alibaba Group

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