In April 2019, around 15 years after it first purchased a Chinese shopping site that would later become Amazon China, the American retail giant finally announced it would stop running its China marketplace. The failure didn’t come as a surprise: Many Chinese consumers had been attached to homegrown platforms for a while, with Tmall being one of the most popular.
Tmall started as a spinoff from Alibaba’s Taobao. Both platforms make money by taking a cut of each sale from third-party merchants. But while Taobao helps mom-and-pop stores sell online, Tmall hosts larger merchants and established brands.
“FASHIONABLE AND SEXY”
Even in its earliest years, Alibaba had intended Tmall to be a venue for premium brands. If Taobao is your neighborhood flea market, then Tmall is positioned to be, well, a mall.
Then president Daniel Zhang (now Alibaba CEO) had high hopes for the new venture. In 2012, he told reporters that the Chinese name of Tmall -- Tianmao, which translates as “sky cat” -- is supposed to sound “fashionable and sexy”.
(Abacus is a unit of the South China Morning Post, which is owned by Alibaba.)
It quickly became a major destination for online shoppers in China. In 2014, just two years after it launched as an independent site, Tmall took hold of more than 60% of the market, according to iResearch. It still retained more or less the same share by the last quarter of 2018, Analysys data showed, ranking ahead of JD.com and Suning.
Tmall hawks an astounding variety of goods to over 650 million shoppers across Alibaba’s ecommerce platforms, including on Taobao where users can also search for items sold on Tmall. Not every product might strike you as fashionable or sexy. But they are almost invariably household names or high-end imports: Think North Face jackets, Colgate toothpaste, Japanese diapers and Australian wagyu beef.
SHOPPING THE WORLD
One of the site’s biggest attractions is giving Chinese consumers an easier way to buy imported goods without having to navigate unfamiliar overseas websites -- nor do they need an international credit card. Instead, they can purchase Korean skincare or American baby formula from a site written entirely in Chinese, and pay with Alipay using renminbi.
For international brands, Tmall became an online entry point for those hoping to sell to China. The site has a dedicated section for foreign goods called Tmall Global, where it carries more than 20,000 brands from 77 countries and regions. Since 2017, it’s also been adding dozens of luxury fashion brands, selling Bottega Venetta purses, Valentino high-heels and Tiffany necklaces to China’s growing middle class.
But there are some brands who are wary of joining forces with Alibaba. Louis Vuitton, Prada and Gucci, for example, don’t have a flagship store on Tmall. Last year, Gucci CEO Marco Bizzarri expressed concerns about accusations that counterfeit products are sold on Alibaba platforms. The brand currently runs its own online store in China.
For several years now, the US Trade Representative has put Tmall’s sister site Taobao on its annual Notorious Markets list. Alibaba says it has been working to remove counterfeit listings on its platforms, having reduced the amount by 67% last year.
Outside of China, Tmall is perhaps best known for Singles Day, its annual shopping extravaganza that takes place on November 11th. The mega sales event, which pools together deals similar to Black Friday discounts in the US, was created in 2009 to help boost sales on Taobao and Tmall, known as Taobao Mall back then.
Since then, Singles' Day has turned into a phenomenon in China, as other rival sites run their own events on the same day. In 2017, Tmall sold US$25 billion worth of goods on Singles Day -- five times more than Black Friday sales in the US that year.
The shopping day has supported new jobs and earning opportunities around the country, even though it’s also placed considerable strain on the environment, as hundreds of thousands of carefully wrapped parcels turn into packaging waste. But for better or worse, Alibaba believes its shopping empire is only going to grow:
“In the past, Jack Ma said that we will one day reach 1 billion packages in a day, but at the time, almost no one believed him," Alibaba’s Zhang said during Singles Day in 2018. "But today, that has became a reality. Sales of 1 trillion will definitely happen, it'll become the norm for everyone – we just have to believe and see for ourselves."