Ever waded through a sea of research papers, trying to wrap your head around the difference between Tmall and Taobao? Ever wished someone could just decode these Chinese retail giants for you? Trust me, I can relate! After diving deep into rainfall-worthy data and huddling with top-tier eCommerce gurus, I’ve untangled this complex web.
In this blog post, we’re going to draw back the curtain on these pivotal players in China’s online retail market. We’ll shine a light on their unique selling points, highlight what sets them apart, and lay out how savvy marketers like yourself can harness both platforms effectively.
Sound good? Great – let’s dive right in!
- Taobao is a consumer-driven marketplace with low prices and a wide range of products, while Tmall is a brand-driven platform that only sells authentic branded items.
- Taobao offers both C2C and B2C sales, while Tmall exclusively focuses on B2C transactions.
- Selling on Tmall can increase brand visibility among a target audience who value prestige and quality while selling on Taobao provides access to a diverse consumer base in China.
- Leveraging the unique features of Taobao and Tmall can help fashion brands reach their target audience effectively and maximize their potential in the Chinese retail market.
What are Taobao and Tmall?
Both platforms in question belong to Alibaba Group, the leader in the Chinese e-commerce market. In fact, Taobao marketplace is the ‘mother’ platform when it comes e-commerce landscape in the Chinese market, whereas Tmall was introduced, as an answer to problems with quality and counterfeit products on Taobao, which we will discuss after.
Let’s delve into those two platforms so that you understand their unique points better.
Taobao: Consumer-driven marketplace
Taobao is a consumer-driven marketplace launched in 2003 by Alibaba Group, where you can find almost anything. It’s the largest online shopping site in Mainland China, operating through a C2C (consumer-to-consumer) business model. Here, consumers rule. They choose from a wide range of products at low prices.
As an e-commerce giant, Alibaba owns Taobao and it acts as a go-between for sales between people. Shoppers love Taobao for its special deals and high competition among sellers which often leads to affordable prices.
At the end of June 2022, Taobao registered 875 million monthly active users. According to Statista, about 1.1 billion people in China were shopping online in 2022 and Taobao was their most popular choice, especially when it comes to young people under 30 years old, who are the main customer group (60%).
With Tmall under the same roof, Chinese shoppers have a smooth shopping journey with both platforms together.
Tmall: Brand-driven platform
Tmall is a part of the Alibaba Group. It’s like a luxury mall online. Only top brands sell on Tmall, as they need to be legal entities to apply for a Tmall store. It’s not for usual sellers or buyers. This platform is all about big business-to-consumer sales (B2C model).
Tmall was launched in 2008 as an answer to the growing market demand for a platform with high-quality branded goods. It registered almost 877 million monthly active users in 2023 and 380 million daily active users, with the majority of shoppers being women, looking for fashion and beauty products.
Selling on Tmall helps brands to shine. Buyers trust what they buy on Tmall because it guarantees real and official items. The shopping experience here is high-class, unlike any other site you know! This is why there are more than 70,000 sellers on the platform, all initially accepted as legal domestic and Chinese brands eligible to sell on this prestigious platform.
Main Differences Between Taobao and Tmall
Taobao targets consumers looking for the best deals and unique products, while Tmall focuses on branded items. Taobao offers both C2C and B2C sales, while Tmall exclusively focuses on B2C transactions.
Additionally, Tmall guarantees official and authentic products.
Target audience: Taobao for best deals and unique products, Tmall for branded items
You need to know your target audience when choosing between Tmall and Taobao. Shoppers who want the best deals flock to Taobao. It’s also a great place for buyers searching for one-of-a-kind items.
Taobao is a place where you can literally find anything, from cosmetic products to animals, flight tickets, and cosplay costumes. This is the main reason why it’s one of the biggest e-commerce platforms in China, not to mention the competitive prices offered there.
In contrast, fans of branded items prefer Tmall. All products on this site come straight from the brands themselves, making it easy to buy authentic items with no fuss! It offers only products of good quality, so it’s a more luxurious and trusted version of Taobao. This is also why the majority of foreign companies decide to sell on Tmall, not Taobao, being it a platform for small businesses and Chinese brands.
C2C vs B2C: Taobao offers both C2C and B2C sales, Tmall exclusively focuses on B2C
Taobao and Tmall have different approaches when it comes to selling goods. Taobao allows both consumer-to-consumer (C2C) and business-to-consumer (B2C) sales, while Tmall only focuses on B2C sales.
This means that anyone can sell and buy products on Taobao, making it a diverse online marketplace. On the other hand, Tmall serves as a retail platform exclusively for brands and businesses, providing an opportunity for them to reach a wider audience of consumers looking for official and authentic products.
Prices: Taobao has the most competitive prices on the market
While Taobao largely centers its appeal on affordability, drawing consumers keen on getting the best deals, it primarily targets a price-sensitive audience. For newcomers, especially foreign brands, contending with deeply entrenched local small businesses offering rock-bottom prices can be daunting. The arena is saturated with smaller local enterprises, making it a challenge for international names to carve out a distinct space based solely on competitive pricing.
Conversely, Tmall presents a contrasting marketplace. Here, consumers come with an appetite for quality, often willing to allocate a premium for products that exude excellence. The emphasis is on brand value and trustworthiness.
A notable advantage for international brands is the prevalent perception among Chinese consumers: there’s a strong association of foreign brands with high quality. Many Chinese shoppers are inclined to believe that overseas brands maintain stringent quality controls, making them a more desirable choice when prioritizing product excellence.
Entry fees and account set-up ease
Taobao provides an accessible entry point for businesses already stationed in China looking to dip their toes into e-commerce without breaking the bank. Its affordability, both in terms of platform usage and associated fees with opening a Taobao store, makes it appealing.
However, a significant caveat exists: without a legal Chinese entity, selling on Taobao remains out of reach. For those considering this platform, establishing a business within China is a must.
In contrast, Tmall throws open its digital doors to international sellers, albeit with more stringent prerequisites and a higher cost structure. Regarded as one of China’s premium e-commerce platforms, Tmall exudes an air of luxury and refinement, reflected in its steeper costs.
Apart from the listing and recurring membership fees, newcomers must also factor in an initial deposit upon store setup. While this deposit is reclaimable, it’s an added financial consideration prospective merchants must account for.
Logistics: Alibaba will take care of it!
With a majority of its merchants based locally, Taobao boasts incredibly swift shipping times, often delivering products within a day or just a few days at most. However, if merchants are shipping internationally, patience among consumers exists, albeit within limits. Swift deliveries have become the norm on Taobao, so international sellers might find it challenging to gain traction if their shipping times stretch considerably.
On the Tmall front, there’s an inherent expectation: sellers need to maintain local inventory, ensuring prompt deliveries. While this policy promotes quick shipping, it poses logistical challenges for international brands unfamiliar with storing stock within China.
Recognizing this barrier, Alibaba introduced Tmall Global. This platform caters to overseas deliveries, setting a clear expectation among customers that they might have to wait a tad longer than usual for their packages.
Benefits of Selling on Both Tmall and Taobao
Selling on both Tmall and Taobao offers the benefits of increased brand visibility on Tmall and access to a diverse consumer base on Taobao, combining the advantages of consumer-driven and brand-driven platforms.
Increased visibility for brands on Tmall
Tmall is a platform known for its association with luxury and high-quality brands. This means that if your brand sells on Tmall, you have the opportunity to increase your visibility among a specific target audience who value prestige and recognize quality products.
Participating in events like Tmall Super Brand Day or Singles Day can also help boost sales and further enhance your brand’s visibility. By leveraging the reputation of Tmall as a prestigious platform, you can gain increased recognition and visibility for your brand.
Access to a diverse consumer base on Taobao
Taobao provides sellers with access to a diverse consumer base in China. With millions of Chinese consumers using the online marketplace, there is great potential for reaching a wide range of customers.
Taobao attracts different types of sellers and offers a diverse product selection, making it an attractive platform for businesses looking to expand their customer reach. This presents opportunities in various industries, including the fashion industry, to connect with targeted consumers and increase sales.
By leveraging the popularity and extensive user base of Taobao, brands can tap into new markets and grow their business in China’s booming e-commerce market.
Combination of consumer-driven and brand-driven platforms
Selling on both Tmall and Taobao provides a unique opportunity to tap into different consumer preferences. Tmall, as a brand-driven platform, focuses on official and authentic products and luxury brands, making it attractive for businesses aiming to establish their brand reputation.
On the other hand, Taobao offers a more consumer-driven approach, allowing individuals to directly sell their products. By leveraging both platforms, businesses can cater to the diverse needs of consumers – those who are looking for branded items or seeking the best deals and unique products.
Considerations for Cosmetic Brands Selling on Taobao and Tmall
When it comes to selling cosmetic and beauty brands, there are several factors that should be taken into consideration.
Platform selection based on target audience and brand goals
Choosing the right platform for selling your beauty brand is crucial. You need to consider your target audience and brand goals when deciding between Taobao and Tmall. Taobao is great if you want to reach more consumers looking for good deals and unique products.
On the other hand, Tmall is perfect if you’re targeting buyers who are interested in branded items like clothes, cosmetics, and F&B purchases. Remember that Tmall has a reputation for offering authentic products and reliable shipping, making it popular among international shoppers.
So think about who you want to reach and what image you want to portray before making your decision.
Strategies for success on each platform
To be successful on both Taobao and Tmall, it’s important to have different strategies for each platform. On Taobao, as a small beauty brand, you can focus on driving website traffic by using keywords and optimizing your product listings.
You can also consider partnering with popular influencers or running festive promotional strategies to attract more customers. It’s essential to understand that Taobao is a consumer-driven marketplace, so engaging with your potential customers and providing excellent customer service is crucial.
On the other hand, Tmall is more suitable for larger brands. To succeed on Tmall, you should prioritize establishing partnerships with official distributors or sellers to ensure the authenticity of your products.
Driving website traffic through targeted marketing campaigns and boosting conversion rates by offering exclusive deals or limited editions can help increase brand visibility on this brand-driven platform.
We are Experts on China’s eCommerce Market!
In conclusion, Tmall and Taobao are both popular e-commerce platforms in China, but they cater to different shopping needs. Tmall is a brand-driven platform that offers authentic branded products, while Taobao is a consumer-driven marketplace with unique deals and a wider range of products.
Navigating the vibrant e-commerce landscape of China, especially when weighing the pros and cons of platforms like Tmall and Taobao, can be daunting. But with Gentlemen Marketing Agency at your side, you’re equipped with not just expertise, but also an edge – we’re proud to be a Tmall certified partner.
Why Choose Gentlemen Marketing Agency?
- Certified Tmall Partner: Our status as a Tmall certified partner ensures that we have direct access to insights, best practices, and tools that others might not. We understand the nuances of the platform inside out.
- Experience with Both Platforms: Whether it’s the grassroots appeal of Taobao or the upscale allure of Tmall, we’ve assisted brands in making their mark on both. We can guide you to choose the one best aligned with your brand’s vision and audience.
- Local Expertise with a Global Perspective: While we are deeply entrenched in China’s unique digital ecosystem, we bring a global perspective to strategize and ensure your brand resonates universally while catering to local tastes.
- Cost-effective Solutions: Navigating the fee structures and initial costs of platforms, especially Tmall, can be tricky. We offer transparent and cost-effective solutions tailored to maximize your ROI.
- Full-service Offering: From setting up your store, managing inventory requirements, to crafting tailored marketing campaigns and beyond, our suite of services ensures a seamless entry and sustained growth in China’s e-commerce market.
Tmall (+ Tmall Global) and Taobao, with their distinct offerings and platform strategies, cater to diverse audiences and brand aspirations. Understanding where your brand fits and how to leverage the best of both worlds can set you apart in this competitive arena. Let Gentlemen Marketing Agency be your compass in this journey.
Reach out to us today, and let’s script your e-commerce success story in China together!