Amazon China will open up shop on its competitor’s website, Alibaba’s Tmall.
In April, Amazon will begin selling around 500 products on Tmall as a trial run before a full roll-out, reports Inside Retail Asia.
On the surface, the deal seems perplexing, as Amazon competes with Tmall, and Alibaba’s other platforms, in China’s e-commerce market.
Though Amazon has sold to the Chinese market since 2004, it has failed to gain any momentum in the country and holds only a 1.4 percent market share. Alibaba, on the other hand, owns more than a 70 percent market share through its sales on Tmall, Taobao, and other platforms.
Analyst Yang Xiao of e-commerce service provider HC International believes the move is an attempt to raise awareness for Amazon in China while drawing business away from JD.com, which holds a greater market share than Amazon in the Chinese market.
“China’s e-commerce industry is fast growing and nobody wants to miss it,” Yang Xiao said. “Amazon wants to add an additional distribution channel in China.”
“It’s simple game logic – an enemy’s enemy is a friend,” he continued. “Amazon is more likely targeting JD.com and it’s a win win situation for Tmall.”
image credit: nic taylor