Alibaba Group’s Tmall Global marketplace is banking on Italian beauty brands to satisfy the Chinese customer’s growing interest in cosmetics from abroad.
As a part of Tmall Discovery, the company’s consumer trends division, Tmall Global held its first European conference, called “The Colors of Italian Beauty,” which took place on July 20. Held in Milan, the conference was part of an opportunity for European cosmetic executives to learn about Alibaba’s brand marketing offering and celebrate Italian brands like Deborah Milano, Diego dalla Palma Milano, RVB LAB, and Kiko joining the marketplace throughout June and July.
For the recent July promotion, each of the four brands had the chance to select two products they wanted to showcase. Kiko sold 30,000 lipsticks in two hours, according to Rodrigo Cipriani Foresio, Alibaba Group managing director for Italy, Spain, Portugal and Greece. Meanwhile, Deborah Milano launched its signature Milano Red lipstick and Secrets of Camouflage concealer palette on the marketplace — while they wouldn’t disclose exact sales thus far, Deborah Group business development manager Mariana Migues said the brand sold through four weeks of planned merchandise in eight days.
The brands, and the conference, are part of a larger Tmall Global strategy to support European cosmetics companies looking to access the Chinese market. For the four brands that recently launched on the marketplace, they will be working with Tmall Global to test new technologies and products in order to offer an exciting shopping proposition to the Chinese customer.
“There is a huge potential for European cosmetics brands entering the Chinese market, which is expanding rapidly,” said Cipriani Foresio. He added that cosmetics revenues in China reached $3.6 billion in March 2018, making it one of Tmall Global’s most promising business categories. Cipriani Foresio credited the millennial and Gen-Z customer’s interest in trying new products for the impetus to launch Italian beauty.
There’s money on the table: Italy produces 60 percent of the world’s beauty products but only accounted for $1.7 billion in sales for cosmetics last year, according to Euromonitor International. China, meanwhile, was three times that size, at $5.1 billion.
The typical beauty consumer in China is younger than ever: In 2017, customers born after 1990 made up over 40 percent of shoppers on Tmall Global, beating out older millennials born in the 1980s, explained Cipriani Foresio. “Consumers born after 1990 like to try new products from new brands and less familiar origin countries, which are often associated with better quality and performance,” he added. Currently, 50 percent of Tmall’s reported 552 million active consumers are under 30 years old.
The recent Italian brand launches follow a similar playbook as Spanish skin-care brand Martiderm, which launched on Tmall Global in 2016. At last year’s annual 11.11 Global Shopping Festival, Martiderm sold over 10 million containers of an ampoule, or concentrated serum. Since its debut on the marketplace, sales for Martiderm’s ampoules have reached one unit per 2.49 seconds, according to Cipriani Foresio.
Based on the success of the initial launch, Martiderm added two new production lines at its Barcelona facility exclusively for the production of ampoules sold on Tmall Global. What Tmall is doing for Italian brands in China also follows what is happening globally for Italian cosmetics exports: The Beauty Made in Italy program, founded by the Italian Trade Commission and Cosmetica Italia, incubates and accelerates Italian beauty brands in the U.S.
China, particularly, is an opportunity for growth. Sixty percent of Deborah Milano’s existing business is done in Italy and 40 percent abroad, but the goal is to grow that Chinese market share, according to Migues. To do this, Migues said Deborah Milano will create additional color cosmetics products, like lipsticks and palettes, exclusively for the Chinese customer that will be available in the second quarter of next year. This ties into what Cipriani Foresio sees is the future for these international partnerships: “Exclusive products for our platforms can better meet the needs of our vast consumer base.”
“We are just at the beginning, but the expectation we have for China is to have the Chinese market represent 10 percent of total business in the next three years,” Migues said.
