Amazon has opened a flagship store on Chinese competitor Alibaba Group Holding’s consumer-to-consumer site, Tmall.com.
Amazon’s store on the site launched this week and so far offers a limited range of products including imported food, women’s shoes, toys and kitchen equipment, the Wall Street Journal reported.
As a Tmall seller, Amazon becomes Alibaba’s customer as retailers and brands with flagship stores on Tmall pay Alibaba a commission for each transaction.
Amazon has been operating in China for eleven years and last year signed a deal to allow it to increase its presence in the country
Despite this, a Daiwa Capital Markets report on e-commerce in China based on data from iResearch found that Amazon had a 1.3% share of the total business-to-consumer market in China in the third quarter of last year, which was a 13.8% point loss of market share from the same quarter in 2008. The report said that in 2013, Amazon China recorded revenue of around 10 million yuan, which accounted for 3% of its global gross merchandise volume, and Daiwa expected Amazon’s China operation to have continued to make a net loss in 2014.
Candice Huang, a spokeswoman for Hangzhou, China-based Alibaba, told Bloomberg: “We welcome Amazon to the Alibaba ecosystem, and their presence will further broaden the selection of international products and elevate the shopping experience for Chinese consumers on Tmall.”
Earlier this year, Amazon said that it had seen growth in China and Hong Kong, with sellers based in the countries seeing their international sales grow 80% year-over-year.