Q&A: For International Brands, What's New On Alibaba's Tmall Global Marketplace?
When Janet Wang joined Alibaba's business-to-consumer website Tmall.com five years ago, few foreign brands had storefronts on the online marketplace. The platform was still young, and Alibaba Group Holding Ltd. was known mostly for its eBay-like Taobao site, a huge bazaar of independent sellers hawking mostly inexpensive wares. Flash forward to 2015, and Alibaba is a U.S.-listed behemoth with 350 million annual shoppers in the world's largest e-commerce market. A few thousand foreign brands sell their products on Tmall, which has become the natural first stop for any brand doing e-commerce in China.
That's in part thanks to Ms. Wang, a former lifestyle and fashion journalist with a master's degree in digital publishing from New York University. Ms. Wang also worked at Vogue China as integrated marketing sales manager.
As head of international business development at Tmall, Ms. Wang has helped bring international brands on board, including Apple, Amazon, Nike, Inditex, Burberry and L'Oreal.
Recently she has focused on building up Tmall Global, a cross-border commerce initiative launched last year that gives brands without a China business license a way to sell online to Chinese consumers. Costco chose that route. Just last week, Macy's said it would team up with a Hong Kong company to start an e-commerce pilot on the platform.
Tmall Global, launched last year, is still young. (According to analytics company Alexa, its traffic is ranked #219 on the Chinese internet, compared to classic Tmall's rank of No. 7.) But it's a high-priority growth area for Alibaba as demand for imported goods soars in China.
For helping international brands tap into Chinese e-commerce, Ms. Wang is an Ad Age Women to Watch China 2015. This interview has been edited and condensed.
Ad Age: Foreign brands now have the option of entering China e-commerce through Tmall Global, without a China business license. What should brands consider as they decide which is the best fit for them – classic Tmall or Tmall Global?
Ms. Wang: Tmall Global is the fast-track solution for merchants that haven't had official presence in China to reach a broader consumer base. The investment required is traditionally lower than setting up a legal business in China. It's a good way for merchants to test the market, and particularly to learn about customers through the data and analysis we provide. It doesn't mean they will have immediate sales – it takes time for small merchants to educate the market and properly introduce the brand to market.
Ad Age: One of Tmall Global's new initiatives lets Chinese travelers preorder duty free products before heading Korea and Thailand, and pick them up at airports in those countries before they head home. For consumers, what's the advantage in that?
Ms. Wang: This is a new model we are exploring as the Chinese middle class travels overseas more … We want to offer them a comprehensive experience. Instead of waiting to check out in shops and waiting to be served, you can place orders online in advance and collect them when you travel to that country to avoid inconvenient experiences. It goes back to our philosophy. We're not only offering general commodities as a lot of other online retailers do. We're thinking of consumers and merchants and how we can bring them together in the most convenient way.
Ad Age: Alibaba's annual November 11 shopping festival is the biggest online shopping event on the planet. Costco sold about $3.5 million in merchandise in 24 hours on Tmall Global; management said they were "shocked and surprised" by the numbers. How has Costco's relationship with Tmall Global evolved? Are there similar success stories from smaller brands?
Ms. Wang: Costco from an early stage has formed a very solid partnership with Tmall Global, which remains the only presence selling Costco products directly to consumers in China. Apart from Costco we work with merchants of all different sizes from all over the world. A good example is European football clubs … Bayern Munich's shop immediately attracted a lot of fans -- the new season jerseys became the No. 1 bestselling item in all the sports category on Tmall. The Real Madrid store in the first two days attracted half a million visitors.
Ad Age: In December, a Wall Street Journal story said brands on Tmall Global were restricted from buying ads on the Alibaba ecosystem. Have things evolved?
Ms. Wang: They get access to exactly what Tmall brands can utilize, including banner ads and keywords … (Initially) there were restrictions on what kind of merchants could participate. We overcame that as the platform developed over time.
Ad Age: Scrutiny about counterfeit goods appearing on Alibaba's ecosystem has increased since the initial public offering. When brands ask you about fakes, what's your response?
Ms. Wang: It actually has been the question I've been asked the most since Day 1 that I joined the company, not just since the IPO! It's an issue all global ecommerce companies face. Alibaba does everything we can to fight that issue, it's important to recognize that we do not tolerate counterfeits, because the health of our marketplace depends on our consumer trust. We cannot do it by ourselves, it's important we work with IP owners to fight for counterfeits.
Ad Age: What are the hottest cross-border commerce categories on Tmall Global?
Ms. Wang: Baby, maternal, healthcare and beauty products are the most in demand as customers want to have reliable, safe imported products. We observe among Chinese consumers in recent years that they're more interested in foreign products that can upgrade their daily life quality and living conditions compared to previously where they were more interested in buying material luxury goods. We sell a lot of products that are general health commodities.
You would be surprised -- we sell a lot of imported shampoo and toothpaste, from companies like P&G and Unilever, but also organic skincare products, for example from German brand Weleda. Air purifiers, face cleansers, water filters, those are very very popular too.
The Ad Age Women to Watch China questionnaire:
Home city: Taipei, Taiwan.
Hobbies: Fixed-gear biking.
First job: I majored in journalism and worked with the China Times weekly back in Taiwan, covering lifestyle and the consumer sector.
Ever lived abroad: In New York for a few years.
Best advice you've ever gotten: This is a real Chinese type of expression coming from the previous Tmall CEO – he told me "tian tian xiang shang," or always look upward day by day.