Behemoth Chinese e-tailers Tmall and JD.com may control 84% of China’s B2C e-commerce market, but there’s one area where they’re not at the head of the pack: cross-border.
Thanks to high demand for imported foreign brands among Chinese consumers, the country’s cross-border e-commerce market grew by an estimated 27.6% in 2017, surpassing $100 billion. But unlike the overall B2C market, cross-border sales aren’t dominated by Alibaba’s Tmall. Instead, the leader is NetEase-owned Kaola, which holds 24.2% market share for cross-border online sales. Cross-border platform Tmall Global is in second with 20.3% and competitor JD Worldwide lags behind in fourth place.
Yet despite this market dominance, brands remain more likely to open official stores on Tmall Global or JD Worldwide than Kaola. While 22% of personal care brands have a JD Worldwide store and 38% have one on Tmall Global, only 19% have opened one on Kaola, according to L2’s China E-Tailers: Beyond the Big Two report. Companies with official Kaola storefronts include Unilever, Coty, and Procter & Gamble, which each sell a range of brands.
In addition to official brand stores, Kaola also sells products through a first-party model, meaning that 73% of personal care brands tracked by L2 can be found on the platform. The e-tailer is moving quickly to expand its brand roster and international logistics network by building warehouses in both Europe and the US, and plans to spend $3.18 billion on European brands and $3 billion on American brands over the next three years.