Tmall is changing the way in which new stores can enter onto their market, and it is a change which could limit just how many products the consumer market has available to them. Before, any store that wanted to enter onto Tmall could do this, but now, stores are only allowed onto Tmall if they have an invite.
Tmall is often seen as a great way to tap into the consumer market throughout China. This is enforced by the newest entry of Burberry, Estee Lauder and L’Occitane.
With this new rule in place, it brings to question, who wants to enter Tmall now?
Why did Tmall enforce such a rule? It seems Tmall is trying to put to rest those claims of sales being faked on the site. In addition, this is meant as effort to cut down the number of counterfeit items being sold on Tmall. However, this new rule brings another issue to the table: It is harder for Western companies to enter into this market.
Though stores and brands from the West are not super popularly with the Chinese consumer, interest is gaining. For these Western brands, entering into the Chinese consumer market was possible through Tmall, and it helped these businesses to decide whether to increase their dominance in the Chinese market. However, this is now harder than ever.
There is a method to overcome this new rule that Tmall has put into place, but it is something that has many brands being overly cautious. The Tmall Partners program is meant to help brands establish themselves on the Tmall market, with the help of an already established business.
It can cost a business anywhere from $10,000 to $15,000 just to partner with the established business
As well as, cutting this business in on profits earned from Tmall. For many companies, this is too big of a financial risk for the company to take.
The only other option that new businesses have to get into the market is through a referral or reference from an existing company. This brings to light the issue of established businesses deciding to increase competition on the market, or leaving it as is.
With the new Tmall rule, some brands are going to be left out, while others are going to continue to dominate the market. However, new businesses looking to use this platform are going to find a long waiting period and should be prepared for a resounding “no” from Tmall.