In Part One of our Selling on Tmall series, we discussed the factors U.S.-based companies should consider before launching on Tmall. In Part Two, we outline three crucial steps to take before officially launching a store on the platform.
Launching a store on Tmall is an exciting opportunity to enter the Chinese retail market — one that is projected to surpass the U.S. in sales this year. While 24 percent of the country’s digital shoppers buy cross-border, the majority don’t, which gives U.S. companies plenty of opportunity to generate demand for their products in China.
Navigating Alibaba’s B2C platform can be difficult for newcomers. Many U.S.-based companies that are familiar with selling their goods on feed-based channels such as Overstock and Google Shopping and may not have the tools, team, and other resources necessary to succeed on Tmall.
In order to achieve a successful launch, it’s crucial that companies have a plan of action in place and follow the necessary steps to ensure they are well prepared.
Have your paperwork in order
First, it’s important to note that there are actually two platforms under the Tmall name: Tmall China and Tmall Global. Tmall China is for businesses that have a physical presence in mainland China, while Tmall Global is for international companies with no storefront in China.
Selling on Tmall Global allows U.S.-based companies to bypass many of the requirements for operating in China, such as a Chinese business registration and a local bank account. The approval process can still take weeks to complete, however.
The requirements to launch a store vary depending on the category:
- Flagship Store for brands. A company must own the brand it’s selling and provide a trademark registration.
- Flagship Store for merchants. A company doesn’t have to own the brand, but they must be authorized to sell the brand’s products via a Flagship store.
- Specialty Store. A company must have distribution rights to sell a brand’s products without geographical restrictions in China.
- Authorized Store. A company call sell different brands but must have authorization.
To prevent unnecessary delays, companies should have their required documents prepared well in advance. They should also keep in mind that a trademark registration in China can take months or even a year to obtain, so the sooner they get started, the better.
Work closely with a TP
Selling products on Tmall is an amazing opportunity to reach millions of shoppers, but it can also be a very complex process.
“This is a daily commitment. Not only will you need to support marketing efforts, but you’ll also need extended support for customer service and logistics,” says Bob Brodie, co-founder and CTO of SUMO Heavy.
He recommends that companies with no experience in the Chinese retail market work with official Tmall Partners, or TPs. TPs offer their clients on Tmall Global (as well as other eCommerce platforms) a variety of services, including strategy planning, brand positioning, digital marketing, store operations, order fulfillment, and customer service. Working with a TP also enables U.S.-based companies to interact directly with and take advantage of logistics platforms like Cainiao. Cainiao has a network of warehouses across China which merchants and brands can use to store and distribute their goods.
It’s important to note that not all TPs serve the same industries. Some TPs focus on a few of Tmall Global’s 3,700 product categories, so it’s vital that companies choose a TP with plenty of experience and a solid track record in a particular category.
Be ready for success
While TPs play an instrumental role in helping their clients navigate the Tmall ecosystem, U.S.-based companies must also have enough team members in China and the States to handle the demands of running a Tmall Global store—especially during the busiest time of the year.
“If your brand gets backed up for weeks as a result of Black Friday sales, you won’t be prepared for a successful Singles’ Day,” says Brodie. “We’ve seen businesses need to hire dozens of temporary staff members and still take three weeks to catch up.”
Singles’ Day, which takes place every year on November 11th, is the most important shopping day of the year on Tmall Global and other Alibaba-owned platforms. Companies have the opportunity to make hundreds of thousands of dollars in a single day, but if they are ill-equipped to handle the demand, they could get behind on orders and lose out on future ones.
Preparing for your Tmall store launch is crucial to the success of your store. Follow these steps and refer to additional information on the Tmall website to ensure you’re making the most of your launch.