Compare the different E-commerce channels in China

Introduction

Tmall: the NO1 E-commerce platform in China. It covers most of the Chinese online shoppers.

• NOTE: When I say Tmall that means Tmall China, not Tmall international. You need a Chinese company to have a Tmall store. Otherwise, you can only join Tmall international. more about Tmall China, Tmall international and Taobao.com

JD: the NO2 E-commerce platform in China. It covers most of the Chinese middle-level online shoppers.

• NOTE: Same as Tmall, when I talk about JD, it means JD.com in China mainland, not JD international.

Pinduoduo: recently launched, they’ve been an IPO company for only 3 years. They announced that their sales have surpassed those of JD.

WeChat: WeChat is not an E-commerce platform but WeChat mini-programs have become extremely popular in China. Since everyone in China uses WeChat, it is a great place to market and sell your products.

There are many other platforms & channels, I will not talk about them right here.

 

Here is an overview of the different channels:  (graded from 0 to 10)

Score/Channel	Tmall.com	JD.com	Pinduoduo	WeChat	Self-own web/APPs
Free traffic	6.5	7	8	0	1
User numbers	7	5	5	10	10
Reputation	8	8.5	3	–	–
Easy to promote	5	4	6	7	8.5
Profit rate	7	7	6	9	9
Customer quality	7	8	3	–	–
Cost	5	5	6	8	8

Conclusions

1. Tmall & Taobao

There is nothing wrong in joining Tmall, but don’t expect too much. It is a channel that will get you a lot of traffic if your product does well. Otherwise, there will be no free traffic. Tmall’s traffic went down a little bit those years, it has been taken over by Pinduoduo and the WeChat Ecosystem. But you still need a Tmall store.

2. JD

JD positions itself as a high-quality goods marketspace, just like Amazon. They sell their own hosted goods and allow other brands to join as well. JD has a pretty good reputation in China. That makes it a fine channel to join. But JD doesn’t have so many methods to promote your store. You need to wait for JD to send you traffic. But who says this is not an advantage for a foreign brand? Anyway as a foreign brand, you are good at general marketing, not at on-platform marketing.

3. Pinduoduo

Pinduoduo is the dark horse of the recent years, Pinduoduo vendors sell products for a very cheap price, but in huge quantities. They target the Chinese who live in small cities and the countryside. They don’t have so much income and are new to online shopping.

If we put Taobao, Tmall, and JD users together, we reach a staggering 0.5 billion users. But the Chinese population is 1.4 billion. So there are still a lot of people (probably more than 0.5 billion) who are not shopping online yet. They are the next source of increase as China’s economy is still growing over 6%. Another big chance may be in front of you!

If your company has a great supply chain that can bring your cost down, and you don’t mind positioning your brand as an affordable brand, Pinduoduo is definitely worth considering.

4. WeChat Ecosystem.

WeChat is a real-time chatting software. But for Chinese consumers, it’s way more than that. With WeChat, you can reach all the Chinese internet users. That is the biggest advantage of WeChat.

WeChat has official public Accounts, you can use this tool as your brand’s official channel where people can subscribe to your brand’s feed.

WeChat also supports Mini APPs, where you can build your own store. Mini APPs just like Moblie APPs, but they run inside WeChat. Users can share Mini APPs easily and do not need to create an account, or input an address to start shopping from it. Additionally, because users can use their WeChat Account information and address, the payment can be made immediately without adding any extra information.

So with WeChat Mini Apps, users can very easily get started. That is a great method to engage users or sell products.

By the way, Pinduoduo has become very successful. Wechat Mini APPs help a lot. People just share Pinduoduo’s Mini APP with each other. This is because Pinduoduo’s business model is “if you share my product with your friend, both of you have a discount”.

5. Self-owned website/APP

Self-owned websites are always necessary, even though not so many people use it in China. But you still need it. And don’t forget to protect your domain name in China.  “.CN”

If your main goal is the pure B2C, you still need it. If your customer wants to know more about your brand, they will still search your name on Baidu.com.

But at this time in China, you don’t have to make it an E-commerce store. Just making it a normal promotion website is enough. Then link it to your other stores. But make sure the design is great.

Later if your business is stable in China and has quite a lot of customers, then go back to upgrade your own store, even launch an APP.

If your goal is to find distributors in China, or your E-commerce is more like a B2B model, you will need to pay more attention to it. Our Magento plan will be your favorite one. Magento has lots of powerful SEO features that can ensure that your web ranking is high on baidu.com (the Google of China).

Summary

Make the right decision, do what you should do and trust your judgment. Get ahead of other brands. China is a fast moving market and nobody is always right. You may be the next dark horse.