(This story was originally published by Internet Retailer)
Alibaba Group’s online marketplace Tmall Global offers U.S. merchants a place to reach Chinese shoppers, but getting Chinese shoppers to click and buy requires work, Power Li, senior business development and operations manager at Tmall Global, said last week at a Tmall Global workshop in Santa Monica, Calif. Tmall Global is a marketplace Alibaba launched in January 2014 that allows non-Chinese retailers a way to sell to Chinese consumers without requiring a Chinese business license and minimal infrastructure investment.
“Some merchants believe they can make a quick success after beginning to sell on Tmall Global because their stores will have access to a high amount of free traffic from Alibaba,” Li said.
But retailers entering the market via Tmall Global need to identify their market opportunities and create a strategy to target potential customers. One way to do so is by marketing so-called hot products, bestsellers that can create buzz. For instance, one unnamed U.S. e-retailer that opened a store on Tmall Global last year found that highlighting five snack products as its hot products helped it attract hordes of new customers, Li said. “Although the profit margin on those five products was thin, the store made huge success because consumers come back and spend more after they bought hot products.” Since that first promotion, half of the retailer’s customers are repeat buyers.
Retailers also have to pay heed to pricing, Li said. Before a retailer starts selling on the marketplace it should research the prices that others are selling its products for, he said.
Alibaba has more than 30 employees who consult with Tmall Global sellers. They provide services, including data support, product selection and marketing suggestions.
More than 5,400 overseas retailers have opened stores on the shopping portal, Alibaba says.
Frank Tong is Internet Retailer's senior editor for China.