Following China’s digitalization, the e-commerce market has naturally been growing exponentially while embracing new technologies and innovations. Chinese consumers are more than ever using online platforms in their daily lives. This has contributed to the growth and success of companies like Alibaba, with its shopping platforms Taobao (consumer-to-consumer) and Tmall (business-to-consumer). E-commerce platforms have become an eldorado for companies that want to expand their activities and export their products in China. Today we will take a deeper look into Alibaba’s Tmall, aka China’s biggest e-commerce platform in terms of revenue (as of 2021). Hopefully, this guide will help you to have a further understanding of Tmall for cosmetic brands, as well as the best practices to succeed on the App and attract Chinese consumers.
Figure about the Cosmetics & Beauty Industry in China
Over the years, the cosmetic industry has been experiencing significant growth, following the shift in consumption of Chinese consumers. As time goes by, the cosmetic industry is getting more competitive, and foreign brands have to be innovative and constantly adapt their strategies according to Chinese consumers, as well as follow the trends. China has indeed a lot of opportunities for cosmetic brands that are motivated and eager to enter this very lucrative market.
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Overview of China’s Cosmetics market
Over the past decade, Chinese consumers have taken the lead in the cosmetic industry. As the most populous country in the world with 1.4 billion inhabitants, China has been for a long time attracting all of the most famous international brands that wanted to seize the opportunity to expand their activities and conquer Chinese consumers. Registering a steady growth thanks to the rising use of e-commerce platforms as well as the increasing purchasing power of Chinese consumers, the cosmetic industry is one of the fastest-growing and most promising fields in China for the near future, becoming the second-largest market (in value) after the U.S, in terms of cosmetics.
With a 13.8% increase in 2019 compared to 2018, China’s cosmetics market is valued at more than 477 million yuan. On another hand, the monthly retail trade revenue of cosmetics in China has reached 27.22 billion yuan as of April 2021 and accounted for 340 billion yuan during 2020.
Even though the Chinese market witnessed a significant decrease in revenue at the beginning of 2020 following the COVID-19 pandemic, which greatly affected beauty products sales, this industry is seeing a swift recovery as Chinese consumers are more than ever ready to go out again and take care of themselves.
China’s rapid digitalization has greatly contributed to the success of cosmetics brands
Following China’s rapid digitalization over the past decade, several e-commerce platforms were able to stand out in the Chinese market, such as Tmall, grabbing over 600 million users as of 2020, and enabling this enormous spurt of China’s e-commerce sector. This has greatly contributed to online sales in terms of cosmetics, and it has become essential for brands to maintain and increase their online reputation, through social media for example. With the popularity of social platforms such as WeChat, Weibo, Douyin, and Xiaohongshu, users are able to share their experiences with others, which also led to the KOL phenomenon. By partnering with KOLs (Key Opinion Leaders), high-end brands are able to increase their brand awareness as well as attract this tech-savvy population.
Therefore, it is important to underline the fact that online retail has been expanding significantly in recent years, especially after the lockdown. Being now predominant in China, online shopping is expected to reach 80% by 2024, which also means that traditional retail channels such as hypermarkets and department stores are going to lose ground. One of the most effective ways to reach online shoppers is to sell your products on the most popular e-commerce platform in China: Tmall.
Tmall: The Leading E-commerce Platform in China
What is Tmall?
Founded in 2008 under the famous Alibaba group, Tmall (天猫), is a subsidiary of the e-commerce website Taobao (淘宝网). Its target market is primarily B2C (Business-To-Consumer). Tmall’s concept is ambitious and wise as it allows both local Chinese and international companies to sell their products through the platform in Mainland China, Hong Kong, Macau, and Taiwan. Tmall stands out from its competitor’s thanks to its strict standards in terms of quality and renown.
If we look at the ranking of top Chinese websites based on traffic volume, it is clear that Tmall leads the way, even compared to the most popular search engine in China, Baidu. In terms of time, Chinese consumers are spending on average 7 minutes per day on the app, which is more than twice the time spent on JD.com.
However, for cosmetic brands that are looking to enter the Chinese market, it is important to understand the differences between Tmall and Tmall Global.
Tmall: The Platform for Companies Within Mainland China
So, as you probably understand, Tmall enables businesses to sell directly their products to millions of customers all across China. As an open platform marketplace, Tmall provides the infrastructure to host your storefront and unfiltered access to hundreds of millions of shoppers. However, unlike Tmall Global, you will have to have an entity in China in order to be able to sell on Tmall.com.
Tmall Global: The Platform for International Companies Outside of China
Launched in 2014 by the giant Alibaba Group, Tmall Global (天猫国际) is the international version of China’s leading online marketplace: Tmall. Known as the most famous and largest cross-border B2C platform, Tmall Global (aka Tmall.hk) offers both wholesale (B2B) and retail (B2C) models for international merchants and has evolved to be a trusted platform to purchase imported products. To understand Tmall’s popularity, we can see that there are more than 20,000 international brands that are registered on the platform, in more than 77 countries. The platform also has a large variety of products, with more than 4000 categories. Tmall Global has been the 6th moth used online store in China, and 65% of Chinese customers use its app on their smartphone. It is also important to know that 78% of Tmall Global customers also use Tmall.com.
Thus, Tmall global allows international businesses with no physical presence in mainland China – which means that you don’t need to have a physical store or a warehouse, you don’t need to be registered with the Chinese authorities, and you also don’t need to have a Chinese business license – to set up an online store on the platform. Tmall Global’s aim is to source the latest and most popular overseas products for Chinese consumers and on the other hand, help overseas retailers capture Chinese consumers’ booming appetite for imported products.
To put it in a nutshell, these are the main differences between Tmall.com and Tmall Global
Why should you sell your cosmetics on Tmall?
- The #1 E-Commerce Platform in China
Over the years, Tmall was able to grab the majority of china’s e-commerce market shares, establishing itself as the most popular Chinese e-commerce website and becoming the best online gateway for local and international retailers.
As of 2021 Q1, Tmall accounted for around 50.8% of all transactions on B2C platforms, far ahead of the 2nd e-commerce platform JD.com with 15.9% of the transaction share and Pinduoduo with about 13%.
To illustrate Tmall’s success, you can see that over the years, Tmall’s gross merchandise volume increased from 847 billion yuan to 3 202 billion yuan in 2020 (more than 3 times higher)!
Then if we look at the most popular categories of products on Tmall, we can see that imported clothes, household items, accessories and luxury products are highly appreciated by Chinese consumers. For example, luxury imported cars such as Lamborghini and Mercedes have seen a 400% growth over the years.
However, when looking at the most popular products on Tmall Global, we can see that Beauty & Personal Care represents more than a quarter of global sales. Luxury sales are also on the rise, + 159% as of 2021 Q1.
- The #1 E-commerce App for Cosmetic Brands in China
With China being the world’s most populous country, it is estimated that more than 780 million consumers in China have purchased at least once through Tmall, thus, explaining why a growing number of international brands are joining Tmall Global. Even if you are not quite familiar with Tmall, you have probably already heard of it these last few years, during big sales events. Tmall is indeed famous for its multiple sales record such as the 11.11, which can generate 74.10 billion dollars within 24 hours!
Moreover, as mentioned earlier, Chinese consumers, both women and men, are fond of cosmetics. Thus, being on the most used and popular platform will be a tremendous opportunity for you to sell your cosmetics in China.
On top of that, if you are selling luxury cosmetics, then you can also focus on Tmall’s Luxury Pavillion. This pavilion is an “app within an app” that enables top selected clients to get access to the most premium and luxury brands with dedicated flagship stores. They also benefit from a unique user experience such AI and AR, which can be a determining factor to attract consumers and make them spend more time on your web page.
- Satisfied Consumers Thanks to a Strict Selection Process of High-Quality Products
When entering the Chinese market, you’ll see a lot of counterfeit products online as well as in the streets. That’s why Chinese consumers are looking for high-quality products and from official brands. Because of all the past scandals, they are more than even cautious when buying cosmetics products. Unlike other e-commerce websites, Tmall is known for its commitment to quality, and that’s why Tmall choses the brands that will be able to sell on its platform. Thanks to this selective process, Chinese consumers are more satisfied from Tmall than other platforms.
How to Sell Cosmetics on Tmall and Tmall Global?
In China, the possibility to open a shop on e-commerce websites does not only depend on your motivation, but mostly on how your brand appears and the potential, it will have on the platform. If you want to get the opportunity of selling your products on Tmall, one of the most consulted e-commerce websites in the world, you will need to show what you have to offer, and convince Tmall you have the potential to attract Chinese consumers’ interest.
Requirements to Register as a Merchant on Tmall
To register your company on Tmall, you have to know that Tmall requires its merchants to have official Chinese documents as well as to have your products registered with the local authorities. This is the reason why most of the foreign brands you’ll see on Tmall tend to be international and F500 brands that already have an entity in China (We can help you register your company in China and get a license for your products).
List of main requirements common to both Tmall.com and Tmall Global
- Submit product information and wait for verification. This lasts up to 10 working days.
- Register an Alipay account abroad. To apply offline takes about seven to ten business days.
- Sign the agreement and pay the annual service fee and deposit. This lasts about seven to ten working days.
- Open the magazine. This includes registering an account in Tmall Global, performing a test, completing the necessary information, adding products, and finally launching the store.
Do I Need a Business License to register my beauty brand on Tmall?
A lot of our clients are wondering if they need a business license in order to sell on Tmall and Tmall Global. In fact, as mentioned earlier, Tmall is made for companies that are already established in China, so you will need to have a business license if you want to sell on Tmall, in order to prove that you are in China. On the other hand, if you want to sell on Tmall Global, which is made for foreign companies that are not in China, then it won’t be necessary to have a business license.
Steps to Register on Tmall
Tmall Entry prep
- · Determine compatibility and resource requirements
- · Assess prerequisites
- · Determine needs from third-party service providers (TPs) more
- · Create logistics plan
- · Prepare necessary documents
- · Reserve technical resources
- · Begin API integration more
- · Complete negotiations and sign contracts with TPs
Tmall Registration and running fees:
If you want to sell your goods on Tmall, be aware that the fees are quite high (although, in most case and with the right strategy it is totally worth it)
• A Tmall Flagship store cost between 50,000 RMB and 100,000 RMB
• Marketplace: between 100,000 RMB and 150,000 RMB
• In terms of technical services, you will have to pay between 30,000 RMB and 60,000 RMB per year
• Sales commission for Tmall can represent 0.5% to 10% of sales (although most of the time it will be around 2% and 5%).
• Finally, as a subsidiary of Alibaba, Chinese consumers are purchasing with Alipay, so it will represent 1% of your sales.
NB: Don’t forget that in order to apply for Tmall, you will need to have native Chinese people to do it, as everything is written in Chinese. You can also contact us, and our native experts will take care of it.
If you want more information on how to register on Tmall.com, you can go on this website
Foreign merchants who want to sell on Tmall Global’s platform must meet at least the following requirements:
1. Owning an overseas company entity
2. Be the brand owner / have brand authorization, and provide a complete product purchase certificates from the brand side.
There are four types of stores available for foreign companies on Tmall Global:
- Flagship store
- Flagship store (marketplace type for services)
- Authorized stores
- Specialty store
Moreover, it is important to know that you’ll have to prove that you have enough money to cover all the expenses and that your company have been running for at least 2 years. Your annuel sales must reach over $10 million in order to be accepted.
How much does it cost to be on Tmall Global?
Tmall requires a deposit between US$8,000 to US$25,000 depending on the store format. The e-commerce platform also charges an annual service fee, which varies according to the product category which can be between US$5,000 or US$10,000.
However, marketers can be exempted of these charges, or pay only half or the full-service fee if they reach Tmall’s predefined sales target. In addition, Tmall keeps 5% of the sales value as a commission.
Tmall Global Products and services requirements
- Commodities: The Tmall Global Guarantee Program claims authentic products that are produced or sold overseas to enter the market formally through Chinese customs and international logistics. It means that foreign brands are not able to store their products on their own in Mainland China.
- Brand store page: Commodity information should be translated into Chinese. Using the international metric system as measurement units, and equipped with Chinese customer services.
- Logistic services: Products should be delivered from bonded warehouses in the Chinese Free Trade Zone or directly from overseas to mainland consumers.
- After-sale services: A return point must be set up in Mainland China.
How our agency help you register on Tmall Global?
Applying for Tmall requires time and money. It is a long process that is entirely in Chinese, which can be difficult for you if you don’t speack Chinese. By working with a profesionnal agency, you won’t have to do all of that.
As a digital marketing agency, we an easily open an official account for you on Tmall global.
Here are some our tmall services
NB: We now take care of business license and logistics
Steps for beauty Brand to Create a Flagship Store on Tmall
Companies that intend to set up on Tmall Global must have a corporate entity outside Mainland China. The trademark must be registered abroad and have qualifications for retail sales abroad. They must also have good credit as well as recognized and operational results abroad.
Beauty brands Requirements to open a Flagship store on Tmall :
- A legal person outside Mainland China (for Tmall Global)
- Qualifications for foreign retail sales
- Ownership of the authorized brand / agency / vouchers
- But you will also have to respect these conditions:
Flagship Stores may open under the following circumstances:
- The store sells and acts on the behalf of a single brand that is owned by the merchant opening the store
- The store sells and acts on the behalf of multiple brands that are all owned by the merchant opening the store
- The store sells and acts on the behalf of a multi-brand marketplace (service class trademark) owned by the merchant opening the store
Criteria that you have to take into account:
- The company must have more than 2 years of experience, with annual sales exceeding $10 million.
- B2C Brands must be aimed to international consumers
Ownership or Authorized Agencies
- Most popular sectors: Cosmetics, Mother and baby clothing, care products, clothing, footwear and accessories.
- Internationally renowned brands’ products as well as luxury goods
Tmall’s requirements also include:
- Products from a foreign country and sold internationally must be inspected by Tmall Global Security and will obviously pass through the Chinese Customs’ Stage
- The presentation page of the product must be written in Mandarin Chinese, using international measures and size, and offering customer services in Chinese
- In terms of logistics, Tmall requires that products must be shipped within 72 hours after the order. It is often preferable to choose direct delivery or delivery through certified warehouses in China that will then dispatch it and send it to consumers. Don’t forget that order tracking for all products is mandatory
- After-sales services must be handled in China for consumers to return products
How to Increase my Conversion Rate and Brand Awareness on Tmall?
Tmall Paid Ads
Advertising in China requires a different approach from what we are accustomed to, especially on Chinese e-commerce platforms such as Tmall. However, some tools of advertising are quite similar to ours.
Depending on your budget and reputation, you will be able to display your products on Tmall’s homepage, and even advertise your brand on a banner ad, as you can see on this ad for the French company Sisley. If you want to have more pieces of information about advertising on Tmall.
Read the case study of Florasis, local cosmetics brand that became an instant hit on Tmall
Developing your Cosmetics Brand E-Reputation in China with omnichannel strategies
Driving traffic to your store won’t be an issue, but getting those first sales can be tricky. In order to do so, you’ll have to work on your online presence and reputation. Indeed, Chinese consumers are extremely suspicious of cosmetic brands that they have never heard of before. They will most of the time rely on other user’s experiences, recommendations, looking at reviews. Word-of-mouth is actually one of the best ways to attracts new customers, and this why your brand e-reputation is essential when it comes to entering the Chinese market. You will also have to be careful when it comes to consumers’ feedback on your products, as it will influence potential consumers and even e-commerce platforms such as Tmall. Get a few hundred sales, encourage your customers to give reviews and you’ll be ready to sell your cosmetics in China.
Develop a Chinese Website & Work on your Baidu SEO
Having a Chinese website is mandatory if you want to enter the Chinese market. Of course, you will be able to attract much more Chinese consumers than having a website in English. Having a Chinese website is also necessary if you want to appear on search engines like Baidu.
Ranking on Baidu is as important as ranking on Google
As the most popular search engine in China by far, Baidu simply is a step you can’t skip in China. However, increasing your website’s ranking on Baidu requires a slightly different way of thinking about Search Engine Optimization (SEO) compared to what you might be used to with Google. Considered as the “Chinese Google”, Baidu is the most popular Chinese Search Engine and stands as the 5th most consulted website in the world. As of 2021, it represents 71.9% of the Chinese market share. You can also advertise on Baidu with pay-per-click ads for example.
Baidu is an opening window to enter the Chinese market as consumers will do their research on it in order to discover your brand. If you are not visible through the first pages, you won’t probably get much traffic. That’s why working on Baidu’s SEO is as important as setting up your e-commerce online shop. In order to do it successfully without wasting too much time, you can contact specialized experts such as GMA. We have helped many companies increase successfully their rank on Baidu, gaining much traffic, and thus, much more clients.
Chineses social media for brand awareness & engagement
As you probably already know, social media are omnipresent in Chinese people’s daily live. Thus, having an official account on social networks is mandatory when implementing your brand in China! Be careful, foreign app such as Facebook, Twitter, Instagram, Pinterest, etc are not available in China. You will have to use Chinese social media to promote your products and your company.
- WeChat: The Best Social Media to Retain Chinese Consumers and Promote your Online Store
Introduced in 2011 by Tencent, WeChat is one of China’s top tech companies. With one billion monthly active users, it is the most popular messaging app in China but it also has a large ecosystem of services. Thanks to WeChat, you will be able to create H5 Brochures, promote your products through Wechat moments, and on top of that, you will also be able to encourage users to purchase products directly on you Tmall store.
Worldwide, WeChat is one of the leading social networks, ranking sixth in terms of active user number, becoming a lucrative marketing platform with its plethora of different functionalities. Its success relies on the fact that Wechat was able to integrate almost all the features that made the success of the world’s most popular networks.
- Weibo: The Best Social Media to Increase your Visibility and Brand-Awareness
Launched in 2009 by the Chinese technology company Sina Corporation (新浪), Weibo (微博) is one of the biggest social media platforms in China. As its name indicates (“micro-blog”), Weibo provides micro-blogging services and is often compared to Twitter. However, it has evolved into a microblogging hybrid with Instagram, Pinterest, Reddit, and YouTube over the years.
As of 2021, Weibo has 56.8% of the Chinese microblogging market in terms of active users, and 86.6% in terms of browsing time over Chinese competitors such as Tencent and Baidu. It has more than 511 monthly active users and millions of posts per day, making it the largest Chinese-language mobile portal. Almost all Chinese millennials are using this social app in order to follow celebrities, KOLs, brands, read news, etc.
With the majority of foreign brands having an official account on Weibo, you will probably have to consider creating an official account on Weibo. To do so, you can contact us and our team will take care of it.
- Xiaohongshu: The Ideal App for Cosmetic Brands
Founded in 2013, Xiaohongshu (小红书) also known as ‘The Little Red Book’ and ‘RED’, is a social media and one of the world’s largest community e-commerce platforms. Over the years, it has grown to become China’s foremost shopping platform in terms of cosmetics & beauty, fashion and luxury products. As of 2021, Xiaohongshu is boasting over 300 million registered users and 85 million monthly active users. It was also valued at more than USD 3 billion in 2018 and has the support of giants like Alibaba, Tencent, Zhenfund, Genesis Capital, etc.
Xiaohongshu (aka RED) is not just a social media app, users can also purchase on it. As a specialized app for cosmetics and having 80% of its users being young Chinese women, Xiaohongshu benefits from powerful word-of-mouth. With users mostly relying on KOLs recommendations instead of just buying products from famous international brands, high-end brands have to conquer KOLs first if they want to attract quickly Chinese consumers. Therefore, using Xiaohongshu to promote your cosmetics will also contribute to increase your brand awareness, and then increase as well your sales on Tmall.
Read our Marketing Guide to RED (Xiaohonshu)
Live Streaming is the New Trend for Cosmetic Brands in China
In the past few years, e-commerce live streaming, a combination of streaming video and e-commerce, has become increasingly popular in China, especially during the Covid-19 pandemic. It has quickly become a valuable tool for cosmetic brands and retailers, thanks to which they can engage consumers and showcase their products.
Why is live streaming one of the most effective marketing and advertising tool for cosmetic brands in China?
- Live streaming allows you to show the products in a realistic and detailed way, increasing the reliability of your brand and product among consumers. You should know that Chinese people tend not to trust brands and products they don’t know. They seek information and advice online or from people who have already purchased the product. It also allows you to improve your relationship with users, increase loyalty as well as attract new consumers.
- Through Tmall’s live streaming functionality, you have the possibility to sell your products directly on the app. Customers have the opportunity to buy your products on the app by clicking on the icon displayed during the live stream, which will direct them to your brand’s Tmall store.
According to Morning post, the live streaming’s growth rate in China was about 119%. The market size has increased from 19.64 billion yuan in 2017 to 456.12 billion yuan only in the first half of 2020.
Discovers more online market place to sell your cosmetics & beauty in China
Contact us to export and sell your cosmetics on Tmall
With China being the world’s biggest market in terms of cosmetics, many brands are trying to enter the Chinese market in order to conquer a wide audience. However, as demonstrated in this article, you will have to understand all of its subtleties in order to sell your cosmetics on the most popular e-commerce platform in China. You’ll need to be prepared beforehand, and prepare the bunch of documents required to register on the platform. Collaborating with an agency specialized in the Chinese market is the best way to achieve your goal and increase your Return On Investment. As all companies are different, the marketing and advertising strategy must be tailored according to their needs and within their financial means.
As a Digital Marketing Agency established in China for almost 10 years, we were able to break through the Chinese market, helping hundreds of foreign brands entering the Chinese market through e-commerce platforms (Tmall, Taobao, JD.com, Kaola, etc). Proud of the success of our collaboration over the years, we are constantly trying to help brands expand their activities in China. So, if you are interested or if you have questions about selling your cosmetics in China through Tmall, do not hesitate to contact us and we will reply within 24 hours.