It’s not easy, when you want to enter in the Chinese market, to find the right local partner to distribute your products. The possibilities are not lacking and the consequences of a bad choice can be dramatic for a company: poor sales and production relegated to the background by the distributor to the benefit of another brand, loss of its operating license, counterfeits, breach of contract thorny …
After branding, the choice of a good distributor is the key to a successful implementation in China. In this, Tmall brings excellent news to foreign entrepreneurs: thanks to its brand new concept, exchanges between brands and distributors will be much easier. Yes, Tmall now allows brands to select their partner from over 85,000 distributors across the country! We tell you everything about this new solution.
A reminder of a classic distribution scheme
In the case of a foreign entrepreneur exporting his products to China, the distribution scheme will necessarily be long. He must first find the Chinese distributor who will distribute its products throughout the country, distributor who will use a wholesaler who will market the products in supermarkets or small stores to reach the consumer.
The complexity of this chain explains the cost of goods imported on arrival.
The difficulties of dealing with a Chinese distributor
Above all, it must be understood that the sole task of the distributor is to distribute the goods: his role – and his investment in the brand – stops there. The distributor does not care about the branding of the brand; his vision of partnerships is short-term. He is wary of the fashionable setbacks and the sudden disinterest of the public for a product that sold well the week before. This is why he is mainly interested in the instantaneous profitability of sales and does not foresee long-term collaboration with brands.
Two facts accordingly:
1. The distributor will not put forward a brand that has not been proven: he will choose an already profitable brand, which will allow him to generate profit for himself.
-> The brand must be able to manage its e-reputation upstream, even before entering into the Chinese market, to be likely to interest a distributor AND to benefit in advance of its popularity once established in China.
2. The distributor will not help a brand to make itself known or boost sales. For a foreign entrepreneur new to the market, the competition is fierce with the international brands already known, which will be privileged because certainly profitable.
-> The brand must support its marketing from A to Z. The most effective at lower cost will be to undertake a digital campaign, what we call brand campaign or lead generation campaign. Being known on social networks makes it possible both to meet its customers, but also to attract the attention of distributors who also do the watch on the internet. Thanks to your actions, you will be able to convince them of the solidity of your business.
How does Tmall work?
Tmall (pronounced Tiānmāo in Chinese, “The Celestial Cat”) is a Chinese retail e-commerce platform launched by the giant group Alibaba, owned by the famous businessman Jack Ma. Tmall works in B2C, that is, it allows companies – local and international – to sell their products to consumers in mainland China, but also in Hong Kong, Taiwan and Macao.
In concrete terms, the platform is revolutionizing mass distribution because it allows – at least for local companies in China – to shorten their distribution chain. Only Tmall becomes their intermediary.
This is one of the largest e-commerce sites in China today, which does not mean anything if we know the propensity of Chinese consumers to use e-commerce for their purchases.
Do not confuse Tmall and Taobao
Do not confuse Tmall and Taobao: following an internal restructuring of the Alibaba group, three distinct companies emerged. Previously, Tmall depended on Taobao’s activities and then became an independent B2C focused company.
Taobao is an online sales site in C2C: this e-commerce platform facilitates retailing between consumers, or for small businesses and individual entrepreneurs who want to open online stores for lack of budget (online store = one store with a virtual facade on the internet but no physical store, in brick and mortar). By comparison, Tmall is better suited for international luxury brands or having big financial means to invest in their branding.
According to the Alexa analytics service platform, Tmall ranked 14th among the most visited websites in the world in June 2018, compared to 42nd for the mobile payment method Alipay, 20th for the Weibo social network, 9th for Taobao, which exists for longer and 4th for the search engine Baidu.
Why Tmall B2D breaks the shack
After this restructuring of the Alibaba Group, Tmall B2D is an incredibly innovative new concept that will revolutionize the e-commerce practiced until then.
This new system reverses the traditional distribution chain and allows brands to connect to distributors, choosing who they will entrust their products among the 85 000 Chinese distributors listed.
What reverse e-commerce entails for YOUR brand
From now on, it is the brands that choose who they entrust their products to!
Tmall B2D gives brands great visibility on the current market and brings them on a platter.
The entrepreneur can now choose his distributor on the Tmall app in the same way that a consumer would roll out a list of products on his Smartphone, before choosing the right product and place it in his basket.
Not so easy to choose, however, when one has no expertise of distributors in China and still put no foot in China. The application entirely in Chinese requires mastery of the language; it is better to be accompanied by professionals in this first step.
Marketing China becomes your B2D partner!
Finding the right distributor for the size of your company, your products and your target clientele is not an easy task: this crucial choice may call into question the success of your implantation in China.
Fortunately, our Marketing China agency has followed all the evolutions of e-commerce in China since its inception. We are very familiar with the Chinese e-commerce market and its players. Local distributors have no secrets for us. Our expertise allows us to support you in your search for the best distributor, we can take care of the entire process for your company.
Are you interested in Tmall’s new concept for choosing a distributor?
Do not hesitate to contact us via our contact form, our team of experts will answer you as soon as possible.
Learn more about our agency
Marketing China is an agency specialized in digital marketing and communication on Chinese social networks. We advise foreign entrepreneurs wishing to enter the Chinese market, work on their SEO and e-reputation. Finally, we accompany them in their search for the local distributor best suited to their brand.
Thanks to our services, your visibility on the Chinese market increases significantly and the launch of your brand in China is a success all along the line.