Taobao has also been involved in clothing going to sea, and clothing has become a new outlet for going to sea?

In the future, consumers will buy clothes overseas like Jiangsu, Zhejiang and Shanghai with free shipping?

Recently, the hotly discussed topic in the e-commerce circle is that Taobao has recently made efforts to go overseas, and this time it is a new move in the field of global clothing going overseas.

A few days ago, Taobao launched the "Global Free Shipping Plan for Large Clothing". It is understood that under this model, the platform will provide merchants with high overseas postage subsidies, directly to overseas consumers free shipping, and help merchants grow rapidly overseas. The first phase of the project covers Singapore, Malaysia, Korea, Hong Kong, Macao and Taiwan, and will expand from Asia to Australia by the end of the year, and then gradually realize global free shipping. At present, Taobao has launched investment promotion on the merchant side, and some high-quality stores on the platform have received invitations. Four months before this global layout free shipping plan, in March this year, Taobao just launched the Xinjiang free shipping plan.

In recent years, the penetration rate of e-commerce in the apparel category is increasing significantly. According to Statista, the global apparel market size has reached $673 billion in 2023. In fact, cross-border listed companies like SHEIN, Zibuyu, and Saiwei Times all started with clothing. Since the beginning of this year, many domestic sportswear brands have been accelerating their way to the sea. Cross-border e-commerce giants such as SHEIN and TEMU are also accelerating their expansion overseas.

"Just like new energy, clothing is also an advanced industry that represents made in China." Some cross-border industry insiders said that after the launch of Taobao's "Global Free Shipping Plan for Large Clothing", clothing is expected to become a new outlet for the next trillion-dollar industry to go to sea. This is also the action performance of Ali following Ali International, and focusing on the big cake of going to sea.

For Taobao, it is not surprising that the field of clothing is going overseas, after all, the clothing category is Taobao's traditional advantageous category, and it has its own advantages in terms of content and obtaining new traffic. But looking at it, the garment overseas track nuggets are in the golden dividend period, but there will only be a lot more competition in the future.

Taobao focuses on clothing

Titanium Media APP learned that in the "Global Free Shipping Plan for Large Apparel" launched by Taobao and Ali International, merchants do not need to set up separately based on the existing Taobao Tmall store, and merchants have independent pricing rights and goods rights, and do not need to consider cross-border logistics. The advantage is that the threshold and cost are relatively low: 0 returns, 0 refunds, 0 shipping insurance. According to internal sources, the registration of merchants in the program far exceeded expectations, and the investment promotion was launched only 3 days ago, and the contract conversion rate in Qianniu exceeded 70%.

Taobao is firm in its plan to go overseas for clothing, and some industry insiders close to Taobao said that this will be a long-term strategy that continues to advance.

It's not hard to see why. Taobao clothing has obvious advantages in going overseas. In the view of Titanium Media APP, first, the clothing category has mature industrial supply chain capabilities in Taobao.

After all, the apparel category on Taobao and Tmall has already experienced the stage of transformation from the earliest industry operation of men's clothing, women's clothing, and children's clothing to sinking into the industry, co-creating with the brand's R&D and supply chain, and constantly transforming from industry operation to industrial operation. It is understood that there are about 2 million new clothing stores on Taobao every year, and more than 400 million users come to Taobao to buy clothes every year. In the past, the apparel category was also Taobao's traditional advantageous category, whether it was in terms of apparel merchants' IP efficiency, clothing differences, content expression or obtaining new traffic, it had its own advantages.

The fast fashion industry requires merchants to have supply chain capabilities and original design capabilities. Previously, iFashion and other standards set by Taobao Apparel were fast-new, high-frequency, and diversified in style. In the past, most offline brands only launched new products on a quarterly basis, but in Taobao, relying on the flexible supply chain of Taobao, the frequency of new products by apparel merchants can also be shortened to weekly.

At this point in time, Taobao clothing focuses on going to sea, and compared with the traditional cross-border clothing base, what is more important is that "Chinese aesthetics" go to sea. Titanium Media APP learned that Taobao once again made efforts to go overseas this time, and compared with the previous going to sea, it no longer relied on the "brick moving mode". From the perspective of categories, Taobao does not want to be an OEM anymore, but wants to emphasize the design aesthetics of Chinese fashion clothing to go overseas.

Secondly, in 2016, Taobao made great efforts to go overseas, at that time, "Tmall going overseas" began to incubate within Tmall, providing a package of solutions such as trading, logistics, payment, and translation for domestic high-quality merchants and commodities, helping them seamlessly expand from the domestic market to the global market at low cost and low threshold.

In addition to selling goods to overseas Taobao users through Taobao overseas version, they are also sold to multiple markets around the world through AliExpress and Lazada.

At the same time, some senior practitioners in the apparel industry believe that since the beginning of this year, apparel merchants have become more and more trapped in high returns, high inventory and high costs, and Taobao has 0 returns, 0 refunds and 0 freight insurance to solve the pain points of merchants. The Taobao platform has returned and refunded overseas, which means that the arrival at the warehouse is equivalent to a confirmed receipt.

The start-up cost is very low for merchants. Taobao merchants do not need to join a new platform, and there is no cost to open a store; There is no need to transform the production line, it is a stock at home and abroad; There is no need to worry about cross-border logistics, and it is sent directly to the designated warehouse; There is no need to worry about overseas returns and refunds, the platform will bear this part of the cost, and the merchant does not need to pay shipping insurance.

The person concluded that Taobao's efforts to allow merchants to try to go overseas in the simplest way, while ensuring that merchants enjoy the right to goods, pricing rights, and operation rights, which is very important for merchants who want to build their own brands. From the role of supplying the platform to being a long-term brand, for merchants, operating a store abroad also requires long-term brand building and fan accumulation.

It is worth noting that Taobao's "Global Free Shipping Plan for Big Clothing" was once considered to be a head-on attack on SHEIN and Temu in overseas markets.

Cross-border e-commerce platforms are facing the problem of "small exemption" this year, involving a series of issues such as cost increase, business compliance, brand building, and overseas layout. In the face of this problem, SHEIN, Temu, AliExpress, etc. are all making efforts in semi-custody business and adjusting investment policies.

It is understood that the full custody model means that the merchant is only responsible for receiving orders and delivering goods to the platform's domestic warehouse, and the platform is responsible for subsequent delivery, operation, sales and even after-sales. 2023 is considered to be the first year of the cross-border e-commerce full custody model. In 2024, cross-border e-commerce will transform to a semi-managed model that gives merchants a higher degree of freedom, and a full-custody model that has stronger control than the platform.

In this way, Taobao merchants "have the right to set prices and goods independently", and the online clothing full custody process will indeed be simpler.

There is only a lot more competition for clothing to go overseas

Although, Taobao said that the next stage of Taobao clothing will increase investment overseas, if the future of buying clothes overseas is really like Jiangsu, Zhejiang and Shanghai, free shipping, is expected to usher in a large wave of traffic, for clothing merchants, this will be an unprecedented dividend.

But for Taobao, the competition faced by the clothing track to go overseas is not small.

On the one hand, SHEIN, a cross-border e-commerce platform that started from fast fashion clothing, is an example, and it has already occupied enough market advantages by virtue of its first-mover advantage. According to Statista data, from January 1 to October 10, 2023, SHEIN's app has been downloaded 208 million times worldwide.

In fact, in addition to expanding the category and allowing cross-border and overseas local third-party merchants to settle in, SHEIN has also consolidated its position in the fashion field through continuous equity and acquisition of internationally renowned brands such as SPARC Group and Missguided, the parent company of Forever 21.

SHEIN's overall volume and plates continue to grow. In June this year, market news showed that SHEIN's sales in 2023 will reach $32.2 billion, an increase of 40% from the previous year, and net profit will double to $1.6 billion. Up to now, SHEIN has covered more than 300 industrial belts across the country, and in 2023, it will launch a plan to go overseas in 500 industrial belts across the country.

In June this year, SHEIN carried out nearly 20 investment promotion and cooperation activities in 13 cities and more than 20 key industrial belts in Guangdong, Fujian, Jiangsu, Zhejiang, Shandong and other strong manufacturing provinces, covering home appliances, home decoration, clothing, department stores, toys, babies and many other categories, and it is expected that in 2024, more than 150 investment promotion and empowerment activities will be held in industrial belts across the country to further accelerate the internationalization process of enterprises in industrial belts.

Looking at the history of China's garment industry going overseas, for a long time in the past, most of the apparel companies going overseas were mainly processing or OEM, with low profits and added value, and it was difficult for independent clothing brands to gain a firm foothold overseas. But now, more Chinese apparel brands are actively going overseas.

In particular, after this time node in 2018, many sportswear brands will go overseas as an important direction to seek new growth points in performance.

In 2015, Anta signed NBA star Thompson to test the United States market, but the official start of the globalization strategy was in 2018, this year, Anta issued a preliminary acquisition intention to Amalfen Sports, so "borrowed a boat to go to sea". Overall, on the one hand, Anta has intensively cultivated the European and American markets through the Owen series to boost brand awareness, and after the group determined its globalization goals in 2023, Anta also began to recruit in the United States.

On the other hand, ANTA is further exploring the Southeast Asian market and continuing to expand its direct retail business in core business districts in the Philippines and Malaysia. Last year, ANTA also established its Southeast Asia International Business Division.

In 2018, Li Ning appeared at New York Fashion Week, and then successively acquired casual wear Bossini, Italy luxury brand Amedeo Testoni and United Kingdom century-old shoe brand Clarks, but so far, Li Ning has not announced a major move to open stores overseas. In 2023, an important step for Li Ning to go global is to buy a "house" in Hong Kong, and it was also publicly stated at that time that it would start the expansion of Li Ning's overseas business in 2024.

Compared with Anta and Xtep, Li Ning's road to sea will be more cautious. In 2024, 361 degrees, a domestic apparel brand, will also open an independent station overseas to accelerate penetration and expand new markets.

Especially in 2024, the "big year of sports", with the holding of international events such as the Paris Olympics, the Asian Cup, and the European Cup, overseas has become a major opportunity for the development of clothing. In the eyes of many industry insiders, the overseas performance of many sportswear brands is expected to grow more significantly.

At the same time, the current domestic e-commerce competition is becoming increasingly fierce, and the growth rate of emerging platforms such as interest e-commerce is slowing down, especially in the clothing category, 618 This year, it was reported that the return rate of women's clothing on short video live broadcast platforms remains high, and high returns, high inventory, and high costs have become the consensus of merchants. In this case, many fashion apparel businesses are also setting their sights on going to sea.

In 2016, the domestic fast fashion brand UR set up its first overseas store in Singapore, and has now achieved market expansion in Southeast Asia. Since then, UR has successively opened stores in core cities and prosperous commercial areas in Thailand, the Philippines and other countries. And last month, according to media reports, UR was considering listing in Hong Kong.

Recently, Li Mingguang, the founder of UR, also publicly stated that single-brand globalization is one of the ways for UR to grow in scale in the future in addition to multi-brand, and in his opinion, Southeast Asia is not the real main battlefield, and the real overseas is to break through the European and American markets. The development of overseas markets is also the second entrepreneurship in his life.

At present, Taobao, as an e-commerce platform, is making efforts to promote the overseas of clothing brands, which boosts more possibilities for Chinese clothing brands to go overseas. This is not only a huge opportunity for the apparel industry, but also a new round of reshuffle challenge.

(This article was first published on Titanium Media APP, author | Liu Dafang, editor - Fang Yu)