With the increasing purchasing power and digitalization of society, China’s eCommerce market has naturally been growing exponentially while embracing new technologies and innovations. On the other hand, the big giants like Amazon, Facebook, seem to be slowly evolving in marketing tools to sellers. Please don’t get me wrong. If the China market doesn’t matter to you, please check out this Amazon strategy article. However, if you are keen to expand your business in China, this piece would be right for you.
In this article, I would share with you the difference between Taobao China, Tmall China, and Tmall Global and Amazon from a seller perspective. By the end of this piece, you can understand what tools and marketing opportunities you can leverage. Also, you can compare this cost with Amazon pro sellers, and then find out the space to make profits.
- What is Taobao China, Tmall China, and Tmall Global
- Taobao and Tmall Marketing Opportunity
- Tmall Global Seller Cross-border Opportunities
- Taotao Marketing vs Tmall Marketing versus Amazon Marketing
- Wrap up
What Is Taobao China, Tmall China, and Tmall Global
Taobao China must be one of the biggest e-commerce platforms based in China. It is owned by Alibaba, and it was eBay China’s key competitor a long time ago if you still remember. The Taobao Marketplace is China’s largest C2C shopping channel. Merchants on Taobao are primarily individuals and small businesses. By 2021 Q1, it has more than 10 million sellers.
Tmall China is a marketplace for trusted brands and products in demand with Chinese consumers. Tmall China requires you to match some criteria to open a Tmall store as well as pay storage fees.
There must be a business entity located in Mainland China holding a Chinese retail business license.
You have to store the products in China and it’s possible to quickly fulfill and ship orders when placed.
Tmall Global is an international and cross-border shopping channel. To mainland Chinese in China, it’s a place to buy overseas brand products. On the other hand, regarding sellers in China, it’s a place to leverage and sell products except for only relying on Amazon. Tmall Global platform covers 68 countries, 3,700 categories of products, and 16,400 brands. Last but not least, if a foreign seller doesn’t have China business entity, Tmall global is a good chance for her or him to enter China
Take Taobao China and Tmall China for example. There are several sections within the ecosystem. It is mainly designed to help brands reach more consumers and assist in marketing efforts.
Weitao is a tool that is built into Taobao and Tmall which serves as a sort of social media within the service. Similar to Redbook or Xiaohongshu, the Brands, KOLs, and KOCs can use Weitao to post content and engage consumers. On the other end, consumers can use Weitao to learn about new products, do product research, and engage with brands and KOLs that resonate with them. The consumers can directly click through some links embedded in the content, and checkout in Tmall or Taobao.
Taobao Live is one of the most powerful and booming marketing tools. It allows businesses to share live content and answer questions from consumers in real-time. With the COVID-19 pandemic leaving many businesses unable to open their stores, the Livestream has seen a massive increase in popularity.
During the early onset of the pandemic, Taobao waived fees and requirements for brick-and-mortar stores to join Taobao Live which in turn resulted in an over 700% increase in new users from month to month. Taobao Live has been an excellent tool for traditional brick-and-mortar companies to adapt to an online presence. The use of Taobao Live is especially useful for businesses that sell large and relatively expensive products that consumers would traditionally rather see in person before purchasing such as cars and large appliances.
Taobao Deals is competing with Pinduoduo. Basically, it’s a group buy model for sellers to boost product sales volume. Meanwhile, consumers can enjoy a cheaper deal. Compared with Pinduoduo, it’s not that popular. But both apps are targeting second, third-tier cities.
Taobao and Tmall Marketing Opportunity
Alimama is the centralized marketing management platform for Taobao, Tmall China, Tmall Global, Youku, Tudou, etc channels under the Alibaba ecosystem. Basically, you can go to every single ad platform through Alimama. Here I would mainly share the core performance marketing ads if you are selling on Tmall and Taobao.
1. Taobao and Tmall China ZTC or Subway ads – 直通车关键字搜索广告 – Amazon Sponsored Product Ads
ZTC or subway ads are a sort of search keyword-driven ads. From my point of view, it must be one of the most cost-efficient keyword search marketing. It helps sellers to reach out to specific consumers and convert them into sales with sexy ACoS or ROI.
It’s charged by cost per click, and sellers can set and adjust the bidding price. Subway or ZTC ads display in the Taobao and Tmall search results. So it provides direct access to products for consumers through search. In terms of the options, basically, there are 3 types of ZTC ads.
Standard Keyword Ads
One is the standard keyword ads. Sellers can add max.200 target keywords for each SKU in this model. And you can adjust the bidding for each keyword manually or by setting some automatic rules. Its setting and targeting mechanism is similar to Amazon sponsored product ads’ keyword target ads. However, Taobao and Tmall have more comprehensive features.
For the keyword variations, it allows sellers to set two match types. Broad match and exact match. Broad match means the product ads display when consumer´s queries contain the predefined keywords or keywords related to them. Exact match means product ads display when it is exactly the same as the predefined keywords.
Store and Product-driven Ads
The other type of subway ad is smart product-driven ads. Basically, you can’t manually select keywords for this ad campaign. Taobao or Tmall AI robots learn your store or product information. Then it would represent you to show your products or store information in front of the right audiences. Meanwhile, it would optimize the performance of the ads based on your original select objective. In fact, it’s similar to Amazon product-driven ads.
Regarding the campaign objective, basically, there are 5 options. They are the new SKU promotion, the flagship store promotion, seasonal festival promotion, Tmall and Taobao Theme activity promotion, and the business as a usual campaign.
The key difference among these is if you can add the products, select the theme or not. For example, if your objective is to drive traffic to the flagship store, it doesn’t allow you to add keywords. On the other hand, if you aim to promote new SKUs, you can add those to the campaign.
Livestream is booming in China and it’s one of the critical formats to drive sales. If you are running a Brand Livestream new product launch, hero product seasonal promotion, or influencer marketing, this type matters. Basically, it correlates to the consumer search query to display ads. Then it aims to generate an audience to your Livestream room.
There are two main intelligent tools when you are planning Tmall and Taobao ads. One must be the keyword planner – 流量解析. Basically, the keyword planner tells you the trend of search volume, the benchmark of CTR, conversion rate. Also, it can help you understand where the traffic comes from and what’s the audience analysis.
The other tool is a Business advisor. Basically, this is a flagship store performance analytic tool. It works as well as Google analytics. You can monitor the traffic, transaction, user in the real-time and historical date range. Furthermore, you can subscribe to their paid plan if you like to monitor competitors and get more insight from the target market. They are things such as search momentum, transaction prediction, etc.
2. Star Flagship Store and Brand Zone – 明星店舖和品牌專區 – Amazon Sponsored Brand
Star Shop or Brand Zone is a sort of brand keyword-based ad. Either of the ads displays in Taobao or Tmall’s search results when prospects search your brand name. It’s only available for brand flagship stores from Tmall. It is the best advertising type to make flagship stores stand out in your business category. Also, it protects your brand from unauthorized sellers and distributors, who are using your brand name.
As you know, brand keyword ACoS is further better than generic product keywords. If your brand has built up in the market, Star Shop or Brand Zone ROI should be the highest in the Alimama ads ecosystem.
Star Shop vs Brand Zone
First thing first, the media buy is different. Alimama charges Star Shop by CPM model. It means it charges you per 1000 impressions in a real-time bidding model. On the other hand, you need to contact the Alimama key account manager to create and activate Brand Zone ads placement. It’s because it is a quarterly, half-year or full-year basis deal. So It’s a reserved buy model.
Secondly, the keyword strategy is different. Star Shop allows you to add on brand variation keywords. They are keywords such as brand name, brand plus product, brand plus category.
On the other hand, Brand Zone has more space on top of Star Shop. They are things such as brand nicknames, product nicknames, or registered core functions legally.
Last but not least, Brand Zone is an upgraded version of Star Shop with more creative templates and more functions. For example, Brand Zone provides the feature of interactive shopping mechanisms. They are functions such as live streaming, entertaining shopping
3. Diamond Booth Display Ads – 超级钻展
Diamond Booth is the display ad. It displays in the core placements of Taobao and Tmall environments, such as the home page. And it also has both a PC and mobile end. The ads format is diverse and integrates with precise targeting as the core approach, same real-time bidding cost model.
Being different from Subway & Star Shop and Brand Zone ads, it can display on both inside and outside the Taobao and Tmall environment through a mobile app or PC.
Diamond Booth display ads charge sellers by CPM. Diamond Booth supports a single product page or store’s home page as the ad link destination. Thanks to the home page placement opportunity, it can generate a huge amount of traffic to your store with a normal set of creative. If the creative and ad format can be more engaging, the Diamond booth ads can drive comparable high ROI. There are 3 major targeting scenarios from the Diamond Booth ads. They are non-convert retargeting, in-market targeting, interest targeting.
4. Taobao and Tmall Product Recommendation Ads – 超级推荐 – Amazon Sponsored Product Ads Plus Display Ads
Product Recommendation Ads is an AI-driven advertising system to push personalized recommendations to consumers based on their in-app activities. It helps brands promote their products, content, short videos, or live-streaming programs under a bidding model.
These ads charge sellers by CPC model, and the average CPC is reasonably cheap. Since the consumers might not have a clear purchase intention. Therefore, the strategy quite fits driving new customers’ attention and visiting the store by interesting contents or live-streaming programs of hero products.
Product Recommendation ads can display on Taobao App Homepage, Shopping Cart, Payment Page, Weitao, Live-streaming Homepage, and Youhaohuo. Basically, it is one of the most visible ad placements on the Taobao and Tmall homepage, appearing after the first scroll.
Product Recommendation ads also can display on the Taobao or Tmall Payment Page. The selling strategy of accessory recommendation or bundle deals can have a higher conversion rate. For example, you can sell the iPhone case after she or he checks out an iPhone 11. It’s similar to displaying car rental ads after she or he reserves a hotel room or flight ticket overseas.
There are two types of product recommendation ads objective. One is to promote new SKUs, and the other is to promote heroes or winning SKUs. 新品推廣 – Promote new SKU and 爆款拉新 – Winning Product Acquire more new customers. The difference mainly is from the targeting segmentation. It’s because it can tell the AI what customers you like to reach out to and convert.
5. Taobaoke CPS – 淘宝客 – Amazon Associate
Basically, each marketplace has an affiliate marketing option. Taobao and Tmall are not exceptional. Similar to Amazon Associate, TaobaoKe is the Affiliate Marketing tool that allows merchants to set up commissions and rewards for individuals or platforms that could help promote the brand and drive sales. It is often used for attracting earned traffic from outside of the Taobao ecosystem. For instance, influencers tell the story of the products. Consumers place orders via affiliate hyperlinks through Weibo, Wechat, publishers, or other alternative channels.
It’s a good strategy for SMEs or new sellers to generate traffic and sales. The motivation and incentive scheme power usually depends on the commission to the partners. Being said that, the cost per sale means the order has already existed. But you are just earning less profit.
Tmall Global Seller Cross-Border Opportunities
Tmall Global is suitable for a company if the business entity is registered outside of mainland China. So Tmall Global presents a growing opportunity for new foreign retailers looking to enter the Chinese e-commerce market. Particularly in the Asia Pacific, RCEP would activate by the end of 2021. We can predict a skyrocketing boost after the import taxation tax is waived in certain product categories.
It’s because Tmall Global is one of the largest cross-border eCommerce platforms. Also, buying cross-border is not new to the Chinese shopper. A Global eCommerce report found that 74% of Chinese online shoppers have purchased cross-border in 2020. Chinese buyers have found plenty of reasons to buy cross-border in the past. The quality of domestic products has evolved and many Chinese brands are popular domestically. Chinese shoppers are still keen to seek global brands’ products through cross-border purchases. It’s for meeting their demands. Below are 2 types of product categories particularly being popular in Tmall Global.
Big-name international fashion brands from North America and Europe, Japan.
Tmall Global shoppers especially like to buy handbags, luggage, and women’s apparel and shoes on this site. And during a covid-19 pandemic, more male buyers purchase lifestyle clothing from Japan, USA.
Chinese shoppers are flocking to cross-border marketplaces to buy beauty products, cosmetics, non-perishable nutritional supplements, and baby food.
If you are interested in the south sea Asia market opportunities, you can look through the other article about Lazada marketing 101. Lazada is owned by Alibaba group.
Taobao Marketing vs Tmall Marketing vs Amazon Marketing
Below is a comparison table between Taobao China, Tmall China, Tmall Global, and Amazon. If you are a pro seller on Amazon, you would find out they are quite similar. The difference is more on the fee structure, customer demand & behavior, admin business entity work, taxation.
Taobao China, Tmall China, and Tmall Global are mainly serving different business clients. If you have a mainland China domestic business entity, it’s no double Tmall China is your first option. On the other hand, if you like to test the waters of your product outside of China, Tmall Global must be your starting point. Please keep in mind that your product category and branding awareness are two key elements to succeed. Regarding marketing, again it’s all about P&L and customer engagement. You can refer to the fee structure, and plug it into your table. It’s to see how much space you can create an adventure strategy to acquire new customers, retain buyers in China.
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