Partnerships with third-party platforms in China are having a positive impact on business, international brands have been saying as they reported financial results in the recent quarters.
The latest to show confidence in such partnerships was Starbucks, which continued to highlight the rapid expansion of its China business through digital partnerships with Alibaba in its latest earnings call in January. During the company’s Investor Day earlier last month, it announced a new virtual store that lets customers order their favorite Starbucks coffee and pastries across multiple Alibaba Group mobile apps. The move was one way to position the global coffee chain to take advantage of what’s expected to be a 45% increase in China’s total coffee market by 2022, Starbucks said.
The China market as a whole continues to entice brands looking for growth, especially given that China is already the biggest retail market in the world and will soon be the biggest market for a number of key sectors, such as beauty and fashion. Still, the most notable long-term opportunity for many international brands is the growth of e-commerce in the country, as China’s online retail market will be more than double the size of the U.S. market in just another three years.
Perhaps it’s no surprise, then, that many companies have singled out Tmall during their latest earnings reports, saying their partnerships with the country’s largest B2C marketplace were helping them not only sell products, but build their brands as well.
Here are a few of those brands and the comments they made during their calls with investors:
|Company||Comments on Alibaba Partnership|
|Abercrombie & Fitch||“We saw a solid start to the holiday season in November, with strong double-digit growth on Singles Day on Tmall.” (Nov. 29, 2018)|
|Adidas||“We’re very clear what we are driving through our own platform…, the only exception is Tmall in China…because we’re controlling what we’re doing there…[in] full.” (Aug. 6, 2017)|
|Coty||“…the quality of the work that I’m seeing with digital innovation, with the partnership with Alibaba, with the work that we’re doing with Tmall…We already have six brand stores on Tmall and we plan to have more in the next 12 months…” (May 10, 2018)|
|Canada Goose||“As we expected Tmall has proven to be the right way to serve our fans online in Mainland China. On Single’s Day, we are one of the top 10 brands in our space, despite offering no promotions and having only been on the platform for just over a month.”
“All of our new stores put in a great performance relative to previous openings and Tmall also had a strong start.”
|Estée Lauder||“In China, single-day activations boosted many of our brands on Tmall. Sales on our brand stores on Tmall on that day in November rose nearly 80%.”
“We had superb results on Tmall. And with the growing interest in makeup, M·A·C was the #1 prestige makeup brand on Tmall during the entire calendar 2018 and has become #2 in prestige makeup in the total market.”
|Guess||“Our marketplace partnership with Tmall is growing at a rapid pace.” (Nov. 21, 2017)|
|H&M||“Sales of H&M on Tmall have got off to a very good start, with tens of millions of visitors in the first couple of months contributing to increasing sales in China.” (Jun. 28, 2018)
“…we always do what’s best for the company in the long term. So we have certain criteria that we look at for the different brands if we are to go on a marketplace. And right now, for the H&M brand, the only one that we are on is Tmall because it fits those criteria.” (Feb. 11, 2019)
|L’Oréal||“E-commerce has reached 16% of L’Oréal Luxe global sales growing at plus 42% including stunning results on Tmall where Lancôme was the number one beauty brand at 11.11 Singles’ Day.”
“For luxury, clearly, one of the growth drivers of our business in China by the way has been e-commerce and our success on Tmall. And by definition Tmall is a fantastic way to reach consumers beyond the cities where we have counters which are mainly for brand like Lancôme…to Tier 3 and some Tier 4 cities.”
|Lululemon||“You look at our performance on Tmall being 175% up year-over-year. That’s an incredible avenue for us to put eyeballs on the brand.” (Sept. 1, 2017)|
|Marriott||“We are impressed by the power of the Alibaba platform. Through a targeted marketing program late last year with Alibaba, we signed up 600,000 new Marriott loyalty members in just eight weeks.” (Aug. 7, 2017)|
|Nike||“In China, Singles Day once again broke records. Nike earned the #1 Sport Brand on Tmall, with our overall business for the day, up over 40% from last year’s Singles Day. ” (Dec. 20, 2018)|
|P&G||“We performed very well in the two major online events in the quarter, which were our 11/11 and 12/12, becoming the number one diaper brand…on Alibaba.” (Jan. 23, 2019)|
|Ralph Lauren||“[In China] we continue to see strong momentum in our distribution with pure play partners including Tmall … during the quarter with very positive brand exposure.” (Feb. 5, 2019)
“This growth [in China, via Tmall] was supported by targeted marketing through social media and influencer engagements.” (July 29, 2018)
|Starbucks||The Alibaba partnership “would be rocket fuel for our holistic digital flywheel strategy in China.” (Nov. 1, 2018)|
|Tiffany & Co.||“To expand with Tiffany’s digital presence in China, I’m pleased to say that we will partner with [Tmall’s] Luxury Pavilion.” (Aug. 28, 2018)|
|Urban Outfitters||“One recent example of this success is the brand’s results from Singles Day on Tmall Global. Singles Day is the biggest one-day sales event in the world, and this year, the Urban brand achieved the #1 apparel brand on Tmall Global.” (Nov. 19, 2018)|
Source: Company Reports