China: Amazon opens store on Alibaba's Tmall
Amazon widening its reach
The initiative by Amazon reinforces the huge dominance and influence of Tmall in China and its position as the first port of call for Chinese consumers. Sales on Tmall saw a 200% uplift last quarter and retailers including M&S and Costco have recently invested in stores on the site.
Cooperation on direct sourcing from overseas
Chinese shoppers have a big appetite for imported products, which are perceived as offering better quality and more fulsome food safety checks. Both Amazon and Alibaba have started sourcing directly from overseas markets and selling directly to shoppers. In August 2014 Amazon set up a shop and warehouse in China's Shanghai free trade zone, which enjoys more relaxed import and export regulations than the rest of China, to sell a wide range of imported products directly into the country.
Alibaba welcomes collaboration
For Alibaba, the presence of Amazon on its site will increase appeal to shoppers and widen its appeal as the ubiquitous online shopping destination.
“We welcome Amazon to the Alibaba ecosystem, and their presence will further broaden the selection of international products and elevate the shopping experience for Chinese consumers on Tmall,” said Candice Huang, a spokeswoman for Alibaba.
Source: retailanalysis.igd.com
