/ Predictive Analytics

The English friendly guide to Tmall analytics

Navigating China can be a black box for international retailers. Plus, most of the good stuff is in Chinese. To help you learn about navigating Tmall, we've put together this complete, English friendly guide to growing your China e-commerce sales with data from Tmall.

Enjoy and feel free to comment below with questions or additional topics you'd like us to cover.

Contents

Intro to China e-commerce strategy

China is the world's biggest e-commerce market dominated by technology giants like Alibaba and Tencent. Here are some fun facts about the market:

  • Over 80% of e-commerce sales take place on the Taobao/Tmall platform
  • Most of the remainder takes place on JD.com and other e-commerce marketplaces
  • WeChat is a popular option for brand.com websites as some 80% of the Chinese population uses it
  • Brand.com e-commerce sites typically account for <5% of sales
  • 85% of sales take place on mobile. Even your mother will be buying online on her mobile.

Taobao is free and is used by small/individual merchants whereas Tmall is the "enterprise" and paid version of Taobao. Because of this characteristic, products on Taobao are generally of lower quality than on Tmall.

Because China is difficult for foreigners to navigate, many brands use third-party service providers (known as TPs in China) to handle everything from store setup, product selection to digital marketing, CRM and logistics in China. TPs usually charge you like a fund manager would: base fee for their services charged based on man-hours required to run your store and an (approximate) 10% incentive fee for any sales they bring in.

This is how many businesses get their feet wet with selling in China. However, the long-term solution obviously is for brands to develop their own brand and capabilities in China. Having your own e-commerce website in China has not been successful so far because most users do not exist in the "browser" ecosystem but rather the "mobile app" ecosystem. That's why many brands who want their own brand site operate their own WeChat e-commerce stores, which is essentially an e-commerce website wrapped in a browser view in the WeChat app.

How can I get a feel of Tmall without reading Chinese?

The starting point to getting a feel of selling on Tmall comes from reading the Tmall seller documentation. Most of these pages are in Chinese and unfortunately, the English equivalents are either absent or not complete.

A neat workaround is to install Chrome and setup auto translate using these instructions.

The best source of information about Tmall is their help centers, APIs, third-party merchant app stores and mobile merchant admin apps. With this, you should be able to get a good idea of what the seller backend looks like, what data is accessible to you and what data analytics solutions are available.

References:

How do I acquire customers?

Marketing on Tmall works like Google Adwords or Amazon. You can pay for search keywords and placements on the landing and other pages on Tmall using CPM (cost-per-impression), CPC (cost-per-click) and CPS (cost-per-sale). A more cost-effective way is to use influencer marketing (淘客) that comes with Tmall.

The tools available to you to make your decisions include the below. There are third-party apps that simply the process of making such information:

  • Product ranking research
  • Ranking of your ads by keywords and positioning
  • Analysis of changes and movements in competitor products
  • Search ranking research
  • Research on industry best sellers
  • Breakdown of traffic sources

How do I localize my products for China?

The same principles of designing and positioning products in supermarkets apply online. Assume we are designing breakfast cereal products for Nestle. There are third-party apps that help organize and present this information to you. The following tools are available to you:

  • Analyze best sellers for ‘breakfast cereal’. We can see information like pricing, sales volumes, product ranking, colors, package sizes and flavors
  • Analyze reviews for Nestle and competitor products

How do I sell to existing customers?

Tmall customers are almost in their own ecosystem. There are marketing tools you can use to send coupons and SMS promotions to existing customers.

These are the tools available to you:

  • You have mobile numbers, names, nicknames and shipping addresses but not emails. Email marketing is not an effective channel in China. You also have details of what these customers bought.
  • Campaign based SMS marketing with no personalization
  • Coupons to customers within the TMall platform
  • Customer service apps
  • Analyze reviews

What's next after Tmall?

One of the challenges businesses have when selling on Chinese e-commerce marketplaces is they do not know who their customers are and do not have a platform for building their own brand. Some luxury brands like Coach have even pulled out off Tmall.

While it is easy to get started with selling on Tmall with TPs, it is important that brands develop their own local know-how through data analytics and their own e-commerce store. One of the options is to look at a competitor's ecosystem - WeChat. WeChat allows you to set up your own e-commerce store through an HTML5 application embedded in their ecosystem. In our opinion, this is hands down the best way to build your own e-commerce presence in China.

Related: How to turn your e-commerce site into a WeChat store

Justin Yek

Justin Yek

Partner & cofounder at Altitude Labs, creator of Metisa, former investment banker, public speaker, hobbyist musician

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