A New Model for Chinese Ecommerce
- March 20th, 2015
- in Ecommerce
What does it mean when the mighty Amazon sets up a store on Tmall? When doughty rival and supposedly staunch JD ally Tencent does the same?
It means Alibaba is the emperor of China ecommerce, of course.
But keep in mind that the empire is growing at Yuan Dynasty rates (Kublai Khan and sons.) And China’s flourishing online population is evolving at an equal pace.
There’s more and more online market, too much for even Alibaba to monopolize.
Goodbye ‘Platform’, Hello Community
It also serves to keep in mind (at least for this extended metaphor) that rich cultural diversity developed under Yuan rule. Today, while there is no one to threaten Alibaba’s market share domination, a profusion of more focused ecommerce portals have been launching, many receiving major VC funding, jockeying for the growing market share that the all-purpose Tmall and Taobao can’t capture.
Ultimately, an empire depends on the will of the people. The Chinese people tire of all-inclusive online “platforms”, and a lot of smart money is going into ecommerce diversity.
Prediction: the focused ecommerce sites that build community and truly add-value content will secure their fiefs under the suzerainty of Alibaba. This is no crystal ball gazing, but rather a logical extension from the success of sites like Babytree, which quickly built a community of 12 million in three years by being a Facebook for Chinese moms. It evolved into the Q&A/KOL platform for Chinese childcare, and today has well over 40m registered users, as well as $25m in funding from NYSE-listed TAL Education Group.
Babytree isn’t an ecommerce site? Very well, we’ll stick to the prediction, gambling that sites with a “Why” will drive Chinese consumer loyalty much more effectively than sites based on “What”. And we’ll take a look at a bit of the ecommerce diversity that tells us, even if China’s not exactly trending to community-based ecommerce yet, we’re at the tipping point.
Sites With a ‘WHY’
YeTang – Remember when all we heard was that the Chinese only paid extra for labels that helped them conform to societal norms of success? “Wild Candy” features independent designer products to over a quarter million registered users, couched in rich media lifestyle branding content. Took on funding from IDG last year.
Yiyao – An online drugstore that just took in $72m of series C funding. At first glance, set up like Tmall, products by category, but the add value content is revealed after the jump (Google translated):
KnewOne – An ecommerce site that almost isn’t. This Shenzhen startup puts gadget lovers first, thus reviews and ratings are the first page to greet the eye, rather than sales and banners. A daring, Why-driven concept that is returning monthly revenue in the low six-figures from low five figure visitors per day. Low volume, perhaps, but high concept and rapid growth from a company barely two years old.
FaxianGo – Even Ministry of Ennui CCTV is getting on the focused ecommerce train, with a safe food site for fans of its program Outlook, and producer Shi Jian, who is the show’s food safety supervisor. A much-needed ecommerce vertical in response to China’s number 1B crisis (pollution = 1A). But will CCTV’s claims of government-supported guarantees of product quality drive wide-based, sustainable traction?
Jiemi – Not a site, but an app for connecting Chinese buyers and sellers all over the world. Already an established C2C cross-border model, connecting mainland Chinese to overseas daigous. What’s the difference? Intimate social media integration, turning that lady from Fujian who lives in Vegas from a smuggler to another online buddy. Bold, but sound enough a concept to have just raised several million USD in series A from the gunslingers at IDG.