This year, Tmall expects more than 20 million products to make their debut on China’s largest e-commerce platform, following a jaw-dropping enough 12 million last year. Alibaba estimates the number of new products launching on Tmall every day now averages about 3000.
But the e-commerce behemoth is working hard to be more than just a sales channel, turning its focus to working with brands to research and develop items tailored to specific demographic groups among the 600 million Chinese consumers who shop the platform.
Driving some of the new product funnel is the Tmall Innovation Center (TMIC), which has just joined forces with some of the world’s leading market research consultancies to help brands power up in-house innovation and product development.
TMIC has formed an alliance with 10 market research firms, including Nielsen, Ipsos, Kantar TNS, GFK, Euromonitor International and AdMaster. The companies will open up specialised analytics and research methodologies to one another to drive richer and more-precise consumer insights, shortening the time and costs required for brands to incubate new products, TMIC said in a statement.
TMIC’s 81-strong client list already includes FMCG and beauty companies, including Procter & Gamble, Unilever, Estee Lauder, Shiseido, Mars, Mattel, Johnson & Johnson, L’Oreal and electronics giant Samsung. Partnerships with these brands have already debuted about 300 incubated products to date, many of which took less than six months to bring from concept to market, significantly speeding up development cycles compared to the typical 18 to 24 months, according to Tmall. As an example, Mars worked with TMIC to develop a new chili-infused Snickers bar to appeal to China’s spice-craving consumers.
In another example, with TMIC’s discovery of younger women’s preference for mouthwash products with flower and fruit flavors, Listerine, Johnson & Johnson’s oral care brand, will launch two mouthwash products in China during this year’s 11.11 Global Shopping Festival targeting women. Using the insights from TMIC, Listerine have only needed around five months to complete the “idea-to-shelf” journey.
Hong Kai, VP of e-commerce research at Nielsen, said working with TMIC to better understand China’s retail market and consumers not only helps clients launch new products successfully, but also ensures sustainable sales growth.
“Alibaba owns the largest B2C and C2C platforms, with more than 600 million users shopping on its sites, as well as a dynamic pool of geographical, on-demand delivery and logistics analytics,” said Hong, adding that combined with Nielsen’s insights into China’s brick-and-mortar channels, thanks to an expansive partnership network that covers about 70 per cent of China’s retailers, the two can obtain “product innovation insights that span all channels, old and new.
“This is a huge breakthrough for us,” he added.
Admaster CEO Calvin Chan said the firm has leveraged TMIC to help its client Nike gauge how advertising on various platforms translates to revenue, such as how short video platforms connect to sales conversion, page views and add-to-cart rates. In the future, Chan hopes to collaborate further to improve ad performance, including through accessing insights into the competitive landscape and to determining the optimal number of times to expose consumers to ads.
“Frequency [or how many times consumer sees an ad] is important. A lot of clients look to us precisely to help them find the most effective frequency levels for their campaigns,” said Chan.
L’Oreal measures men
Leveraging insights from Alibaba’s users, L’Oreal and TMIC in September released a white paper on the male beauty sector in China. At the same time, the China division of the world’s largest cosmetics group launched an online-to-offline campaign, “Super U Carnival,” targeted towards five types of male consumers highlighted in the report, from early twenty-somethings who want only men’s-specific products to more professional thirty-somethings more focused on personal care than appearance.
During the week-long campaign, L’Oreal distributed nearly one million samples to potential customers online, as well as offline, as it rolled out Tmall’s scan-to-pay sample vending machines at university campuses and shopping centers nationwide.
“For brands, TMIC is not only an important, but also irreplaceable platform for us,” said Connie Tao, director of consumer and market intelligence at L’Oreal China. “We have a common goal: data enablement … to take analytics and consumer insights, and applying that commercially and maximising value.
“We hope our collaboration with TMIC goes beyond incubating new products together, but also to drive innovation for our brands in both product marketing and New Retail experiences. TMIC and Tmall can help us achieve that,” said Tao.
In other projects, TMIC might take a deeper involvement in the design process. In September, TMIC and Tmall’s watch division generated a detailed report on China’s fast-growing wristwatch market, and based on the report’s findings, invited 50 young designers within Alibaba’s ecosystem to create 600 designs, among which 50 were selected for concept-testing with a small group of shoppers.
The 17 designs selected in the end are being produced by 10 Chinese watch brands — including Wussa, Geya and Jonas & Verus — all slated to launch during the upcoming 11.11 Global Shopping Festival, said Tmall.
US jewellery house Tiffany & Co. and Moncler are among the brands that made product debuts on Tmall as of late, with Tiffany launching its ”Tiffany Paper Flowers“ collection in August and the Italian-based apparel label in September releasing its latest “Moncler Genius” line on the Tmall Luxury Pavilion, the site’s dedicated luxury shopping platform. Tmall president Jet Jing says the platform is inspiring millions of Chinese consumers to pursue better lives.
“Tmall aims to help every brand speed up its product R&D, innovation process and time-to-market, reducing the risks faced by introducing a new product. This also allows more new categories and products to feature in Chinese consumers’ lives at a much faster pace,” he said.
This story is based on content provided by Alizila, the news source on Alibaba Group businesses.