Alibaba will not give up its market share to Pinduoduo
Alibaba is China’s biggest e-commerce enterprise. It includes e-commerce platforms and mobile payment apps like Taobao, T-mall, Fliggy, and Alipay, etc. Not only do Alibaba’s apps play a role in people daily’s life but the action of the group greatly impact the way of do things for merchants.
For the past two years, Alibaba has been reviving its almost forgotten market place Juhuasuan. Why? In order to compete with growing competitor Pinduoduo, which just surpassed JD, and became the second-largest e-commerce platform in China. For those who don’t know, Juhuasan is one of the eCommerce platforms owned by Alibaba. It focuses on selling the unsold inventory of Tmall and Taobao’s Merchants at a discounted price. However, the platform was “left for dead” until Pinduoduo came forward and started to walk on Alibaba’s territory.
We just mentioned it, with the rise of Pinduoduo (Market place focused on social eCommerce and low price group purchase) Alibaba decided to revisit Juhuasuan. It did so with new sellers tools available on Tmall, such as Tmall Luxury Channel, Brands sales, or even Brand Activity. This all happens, in an effort to gain more market share and be more attractive for foreign and local merchants, the group is investing heavily in Juhuasuan.
3 ways Alibaba Promotes Juahuasuan with Tmall Tools for Merchants
If you scroll on Tmall, you’ll 3 news categories: “Brand sale”, “Luxury Channel”, and “Brand activity”. The purpose of these new features is to drive traffic to Juhuasan, however, they are great tools for brands to get visibility on Tmall. Let’s see what these features are about!
In the brand sale section, you’ll find all kinds of products: clothing, bags, skincare products, snacks, etc. Clicking on the link will send you to Juhuasuan. It is a great way for a brand to get rid of unwanted stock and users are happy about getting great deals on the middle to high-end products.
The fact that its link to Tmall is beneficial. Tmall is highly trusted by its users, a lot more than Pinduoduo. Pinduoduo gained a lot of popularity but still can’t compete with Tmall in terms of customers’ trust. The fact that Alibaba offers super deals to buyers from selected sellers is a definite plus.
If you already have a store on Tmall, we strongly suggest you look into Juhuasuan.
Tmall Luxury Channnel: Luxury Pavilion
The Luxury Channel in the same way Pinduoduo does offers buyers the possibility to group purchase. The difference is that you are not getting cheap items but luxury ones.
Alibaba using this popular method of buying found a smart way to grow its market share in the Chinese luxury market. This channel comes as a good complement to the Tmall Luxury Pavilion.
Just like the brand sales, it is a great tool for luxury brands to sell old stock but also to access a new audience and get more exposure.
Brand activity is a paid advertising section provided by Tmall. When the user clicks on the image or the button of Brand activity, it will take the user to the home page of the brand’s T-mall store. It offers great convenience for merchants/brands which want to increase store traffic rapidly, build brand awareness and boost conversion rate.
Who can get on Juhuasuan?
Obviously, not every merchant can open a store on Juhuasan. The reason is in concordance with Alibaba’s politique on offering great services to its users.
If you are a Taobao merchant: Your store‘s rating should be higher than 98% and have at least a 5 diamond rating. (The cosmetic store should pay three for the fake one)
If you are a Tmall merchant: Your comprehensive score should be above 4.6 points.
In both cases, your store has to be more than 90 days old and shall not be in the penalty period, and/or suspected of credit or trading infraction.
Selling Condition on Juhuasan:
- The merchant should complete the delivery within 7 days.
- If the buyer returns the goods, the freight costs have to be taken care of by the merchant.
- A store can register three items at a time, Inventory needs to be over 1000.
- Products must be guaranteed to be brand new.
Juhuasuan launched the “10 Billion subsidies” campaign in 2019 and will continue to bring more benefits both for merchants and customers. The huge profits to be made and the pressure from competitors will prompt Alibaba to offer more discounts to consumers and more support to merchants while ensuring product quality.
The unfortunate Covid-19 outbreak is significantly leading to the rapid growth of China’s already popular e-commerce industry. Consumers of different backgrounds, incomes, spending habits, and ages are more positive about e-commerce. Online education, instant food, and some other industries are reaping huge profits this spring. With both platforms support and government support under this special moment, this may be the best opportunity for merchants to join China’s e-commerce.