Alibaba’s Tmall chases U.S. retailers and hopes to generate RMB 200 bln sales in 2012

22 July 2012 17 h 33 min Comments Off

Alibaba Group Holding Ltd.’s Tmall online shopping unit aims to attract more overseas retailers as demand for U.S.-branded goods from its users in China increases.

“The Chinese company met business owners at seminars in Chicago, Detroit, Atlanta and Seattle this month as part of the unit’s first U.S. tour to discuss opportunities to sell goods to consumers in China via the Internet, said Janet Wang, head of international business development at Tmall.

Tmall seeks to add more overseas retailers to its website after signing brands including Levi Strauss & Co., Gap Inc. (GPS), and Adidas AG to open online stores.

The Alibaba unit, fighting to gain users against rivals including 360buy Jingdong Mall, is widening the range of foreign goods on its site as economic growth in China enables more consumers to afford them.

“Demand for foreign brands remains on the up and up,” Wang said yesterday in an e-mail interview, without providing figures. “Our goal is to continue to fulfill these consumer demands and provide our users with the most comprehensive brand and product selection as possible.”

“As Chinese consumers become more sophisticated, they are becoming more open minded to foreign brands,” Wang said.

Tmall, which operates online storefronts for retailers and doesn’t sell its own goods, accounted for 37 percent of China’s business-to-consumer online commerce market in the first-quarter, according to research company Analysys International. It leads second-placed 360buy, which has a 17 percent market share, according to Analysys. Alibaba Group, part-owned by Yahoo! Inc. (YHOO), is China’s biggest e-commerce company, operating sites including Tmall, Taobao.com and Alibaba.com.

TMall’s 2012 Transaction Volume May Exceed RMB 200 Bln

On July, 18 Alibaba Group’s B2C e-commerce site TMall revealed its total transaction volume for 2012 may exceed RMB 200 bln. Consumer electronics are expected to account for RMB 50 bln, while apparel sales will generate an estimated RMB 60 bln. The platform’s transaction volume growth rate will exceed 100% this year, while gross profit margins will be up more than 50% YoY. TMall plans to invest RMB 1 bln in H2 2012 on promotional activities.

Sources: Sina Tech (18/07/2012), bloomberg.com (21/07/2012)

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