The way Jon Azrielant tells it, the China market came looking for Jewelry.com, not the other way round.
But, two-and-a-half years later, he’s darned glad it did, with the jewelry company’s sales through Alibaba’s Tmall.com shopping site booming and prospects for growth and expansion looking even better. Tmall is the largest business-to-consumer (B2C) retail platform in Asia, enabling businesses to sell directly to millions of consumers throughout China.
“We didn’t pick China. China picked us,” said Azrielant, Jewelry.com’s director of marketing. “We didn’t decide to go after a market. We decided to get out of our customers’ way and make it easier.”
Back in 2014, China was but a blip on the horizon for Jewelry.com, which was wrapping up a highly successful strategy to vertically integrate itself. The company, founded in the 1980’s as a jewelry-sales company, was acquired by Warren Buffett’s Berkshire Hathaway Inc. in 2007 and is now an anchor of its newly founded parent, Richline Group.
From its humble origins, Richline has become — among other things — the largest gold manufacturer in the United States and the largest jewelry company in the world by multiple measures. The group owns everything from mines, to designers, to stone-polishers and jewelry smelters, global merchandising, brands, marketing and distribution operations.
More on Tmall
Tmall Reinvents the Marketplace so Brands can Stand Out (Alizila.com, May 3, 2016)
About Tmall.com (Tmall.com)
What is the Difference Between Taobao and Tmall? (TaobaoFocus.com)
As Cross-Border Buying Surges, So Does Tmall Global (Alizila.com, Jan. 13, 2017)
Cross-Border Shopping Surged on Alibaba’s Tmall Global in 2016 (Alizila.com, Dec. 22, 2016)
International Fresh Foods on Tap for 11.11 (Alizila.com video, Oct. 29, 2015)
Azrielant said a deep dive into Jewelry.com’s site visitors nearly three years ago offered some eye-opening data and served as a beacon to turn attention to the China consumer market.
“We discovered 15% of our traffic and 20% of our revenue was coming from China already,” said Azrielant. “What made this such a startling discovery was we didn’t ship to China. We didn’t accept China bank cards or Alipay.”
It was at that point that Jewelry.com set out to capture Chinese consumers, who were already “overcoming impossible hurdles to get our products,” he said. “They were working with their own freight-forwarding services or having products shipped to family members.”
So, Jewelry.com decided to start selling to Chinese consumers directly through Tmall.
Initially, the onboarding process was a bit fraught and confusing, he said. But, as they struggled to understand contracts and the certification process, there was never any thought of turning back. They had a lot of help from their Tmall Partner, Shanghai-based VoyageOne, which smoothed the process of getting the storefront up.
“For us, the Chinese market has been the highest-hanging fruit we’ve gone after. It’s just so sweet, we had to go after it,” Azrielant.
In the two-and-half-years since Jewelry.com became a Tmall vendor, Alibaba has streamlined the onboarding process, making it quicker and easier. Paperwork for certification can now be submitted electronically, and an online checklist tells you what your status is, if there are any missing documents or what you need to do to resolve any outstanding issues.
“Now…we have the rules and fee structures publicized online,” said Yin Dongping, Tmall Global business development manager. “There have been improvements on process, in terms of speed and clarity and also transparency.”
Nonetheless, both Yin and Azrielant advise U.S. brands that want to sell on Tmall to work with experienced third-party companies recommended by Tmall to make the onboarding and selling process pain-free. All along, Jewelry.com has worked with third-party service provider, VoyageOne, to help it build and scale up its presence on Tmall. Figure out how and where you want to position yourself, decide whether you want to open your own storefront, or if you’re a smaller company, choose wisely which Tmall storefront you want to join, Azrielant said.
“Join a Tmall storefront that you trust,” Azrielant said. “There are even a couple folks out there opening up Tmall stores that aggregate together multiple merchants.”
Since Jewelry.com began selling on Tmall, the company’s share of revenue from China has climbed to about one-third from 20%. Demand is so strong that it has led to job-creation, both in China and in the U.S., where its operations are based. Azrielant says Jewelry.com has added five heads in the U.S., alone, to establish 24/7 chat-based customer service just for China customers.
“Customers reach out to have conversations with us,” he said. “That growth just supports more heads, period.”
Azrielant describes himself as a “student” of the Chinese consumer, rather than an expert.
“I think we’re trying to approach this market with the utmost humility. I won’t pretend to say I understand the Chinese consumers,” said Azrielant.
One thing he has learned is that China’s “emerging middle class is keenly interested in shopping American.”
“There’s a widespread perception that the overseas version is superior to the Chinese version. I think that helps explain the strength of baby products and consumables. But there’s also a great deal of brand affinity,” Azrielant said.
That has worked to the advantage of Jewelry.com, which own over 250 jewelry brands. Two of them — the Crystaluxe brand in exclusive partnership with Swarovski, and the XPY brand — have done exceptionally well in China, including during Alibaba’s 11.11 shopping extravaganza in November 2016.
The success of XPY, short for “express yourself,” was a pleasant surprise for Jewelry.com.
“It’s a collection of various designs, each kind of different or unique. There are animals or symbols that allow people to express their individuality. We weren’t expecting it to be such a hit,” Azrielant said.
Overall, Chinese online consumers have standards that “completely dwarf the expectations from U.S. customers,” Azrielant said, and that has made Jewelry.com up its game in everything from packaging to fulfillment.
“We’ve had to vastly improve the quantity and quality of photographs, we’ve improved our packaging and customer service in China,” Azrielant said. “It’s like nothing we’ve ever seen.”
Azrielant said he finds intellectual property rights protection on Tmall solid. Between his company’s independent efforts to protect its brands and Alibaba’s online reporting system for removing counterfeit-product listings, “you get fast, thorough results. Issues are very rare,” Azrielant said.
Jewelry.com recognized early on that discerning Chinese shoppers want reassurance that what they’re buying is authentic, so Jewelry.com has obliged, to set their minds at ease.
“We’ve added certificates of authenticity and layers and seals on our packaging,” he said.
What comes next for a company that has tasted success in China?
“More products, more brands and product designs,” said Azrielant. “Most important is that we continue to improve the experience for customers, to add value. We need to be making our customers even happier.”