Date
13 December 2017
Aliababa Group is giving a facelift to its TMall unit. Photo: Bloomberg
Aliababa Group is giving a facelift to its TMall unit. Photo: Bloomberg

Alibaba’s TMall pursues a new gameplan

Gearing up for a huge initial public offering, Chinese e-commerce giant Alibaba Group is doing everything it can to justify a high valuation, which estimates peg at anywhere between US$100 billion and US$150 billion. 

In the latest move, the group’s business-to-consumer (B2C) platform TMall is adopting several new strategies in a bid to boost the average order size as well as to lure more brand goods onto the mall.

A senior executive of the online mall recently unveiled a five-point 2014 strategy, whose key elements include making TMall brand more fashionable, focusing on industry vertical integration, maximizing the value of members, personalizing the mobile shopping experience, and tier-based after-sales services.

Brand fashioning is a top priority this year, with the company indicating that it can afford some short-term sales pressure to achieve the target.

The new strategy suggests that Alibaba is trying to give a facelift to TMall, which holds more than half of China’s B2C market, in a bid to maintain momentum and defend market share against rival portals such as VIPshop and JD.com, as well as to establish a niche and high value brand image in the market to stand apart from competitors.

At present, TMall is not dominant in all product categories. It is a market leader in fashion and clothing, household products and kids’ products, with more than 50 percent market share in online sales, but lags in some other categories. The consumer electronics and electrical appliances segment, for instance, is dominated by JD.com, while food and snack segment is dominated by Yihaodian.com.

The 2014 action plan marks Alibaba’s efforts to further differentiate TMall from Taobao.com, with the latter more focused on serving the mass public buyers and sellers, while TMall is more like a virtual department store with wide range of brand merchandise from both local and overseas brand owners.

This year, TMall will continue its annual Singles’ Day event on November 11 to boost sales, and will promote the event overseas to boost TMall brand awareness in developed economies such as US and Western European nations.

Getting TMall to be accepted in US and Europe could be an uphill battle for Alibaba Group, given that foreign governments have a negative impression of the e-commerce firm due to product piracy issues. US authorities had earlier put Taobao on the list of “notorious markets”, implying that counterfeit or pirated products were sold on the mall. But the company managed to secure removal from the list in 2012 after Alibaba took proactive action to prevent copyright infringements by the vendors on its e-commerce platforms.

Apart from looking beyond China, TMall is also catching up with the mobile trend by introducing dedicated mobile applications to let shoppers proactively receive notifications on the latest promotions from their favorite brands. Such notifications could help customers visit TMall more frequently.

– Contact the writer at [email protected]

RC

 

EJ Insight writer

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