With the rising demand of Chinese consumers, Alibaba’s Tmall ties up with both local and international cosmetic brands aiming to launch 1,000 Tmall stores this year. This is part of Tmall’s goal to become the platform of choice for international beauty brands of these Chinese shoppers.
During Tmall’s Annual Beauty Summit, seven well-known international cosmetics brands have signed agreements to launch their respective flagship stores this year, namely Procter and Gamble’s new beauty brand Oriental Therapy, Japan’s cosme and d-program, Korea’s Primera, Sweden’s Barnängen, and international brands Glamglow and Tom Ford.
Also, five other beauty brands, including Korea’s Innisfree, international brands Maybelline, Kiehl’s, and local brand WINONA, joined Tmall’s New Retail partnership. This will allow them to penetrate the Chinese market more effectively by combining their in-depth insights from offline promotional and storefront activities with new online information.
Additionally, even the Korean Small & Medium Business Corp. (SBC) plans to launch its own flagship store on Tmall, housing around 50 Korean niche brands, to address the growing demand of Korean beauty products amongst Chinese shoppers.
Given Alibaba’s extensive 700-million customer reach in China, alongside with its technical support and market expertise, Tmall has indeed become the go-to platform for a brand’s entire story – from brand discovery, awareness building, customer engagement, sales transaction, product delivery, and after-sales service. Jet Jing, President of Tmall, acknowledged the rise of Chinese consumers in the beauty market sector and aims to address this opportunity with working more brands in the future.
The numbers do not lie too. By offering a seamless experience to both online and offline transactions, Tmall physical good GMV grew to 29% year-over-year in the 4Q of 2018. And according to the report presented by Tmall and retail market research firm Kantar, sales of beauty products in the said platform had increased to more than 60% last year, overtaking the industry’s average growth rate. Moreover, the online sales of cosmetics and personal care products overtook the industry’s average of 32% in 2018, being 37% and 36% in China respectively.
The highlight of the report also showed the unexplored potential of the Generation Z female market to cosmetics companies, especially to new brands. The Generation Z female is defined as aged between 15 to 18 years old, new to the beauty market, and more willing to spend on high-end beauty products as compared to other women age groups.
With Tmall’s unparalleled edge in product launches, such as live streaming of shopping experiences and creating exclusive online offers, and leveraging both online and offline shopping channels, brands are now able to effectively enter this new market. The proof of this tried and tested method shows around 80% of Tmall new brands were already in the platform and performing well. An example of such would be new domestic beauty brands, Perfect Diary and Home Facial Pro, both of which were among the many beauty and personal care brands, whose sales actually topped RMB100 million during the 2018 11.11 Global Shopping Festival, all thanks to Tmall’s wide range of promotional offerings.
Honorable mention during the Beauty Summit goes to Alibaba Business Operating System, a Tmall’s one-stop solution to aid not only beauty brands, but brands across all industries, through seamless processes in sales, supply chain and logistics management, payment transactions advertising and marketing, and other support services.
Finally, there are also plans in early 2019 to incubate 100 new products into the Tmall platform for 10 billion yuan GMV.
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