Launched in 2015 by NetEase, a chinese leading online gaming and internet service provider, Kaola is the second largest cross-border retail e-commerce platform selling Western brands in China, the first one is Tmall Global .
Kaola name, which means koala, was chosen as NetEase wants its users to remain "lazy and comfortable" just like the marsupial. Kaola offers a wide range of products for baby and mother care, health care, beauty and cosmetics, with a fast delivery service.
In September 2019, Alibaba Group, which also owns Tmall, announced the acquisition of the $ 2 billion Kaola. This explains why Tmall and Kaola are closely linked during large commercial events.
Even though Kaola is still considered a young player in the e-commerce sector compared to Tmall or JD, it has been able to become China's leading cross-border e-commerce platform with a market share of over 27.1%. in 2019, until it was overtaken by Tmall Global in early 2020.
Kaola's turnover is lower than JD.com, in fact at the moment we are at 69.979 million dollars against 3.131 million dollars (2019 data). It should be considered that following the Covid-19 pandemic, its revenues have significantly increased.
Like any other cross-border e-commerce platform, Kaola allows sellers to showcase their products on numerous forums, portals, and online marketing channels.
Kaola provides a platform from which international brands can safely sell their items to Chinese consumers, who in turn purchase high-quality products at affordable prices. Its main model of cooperation is the direct purchase of products which are then resold by them, or through authorized resellers.
The koala marketplace offers 3 solutions to sell products. The first involves the opening of an online shop, the second the integration of the website (if e-commerce) within its platform and the third the wholesale in the Alibaba style.
The self-management mode chosen by Netease allows sellers to set their own prices. You can then adjust your strategy based on the type of market and on the basis of competitors, coordinating the entire supply chain and all aspects of storage, logistics and operations, just like on JD.com.
Kaola's strategy is to open branches in nearly several countries and regions such as San Francisco, Tokyo, Seoul, Sydney and Hong Kong to select high quality products and avoid multilevel connections as agents and distributors, thus reducing costs and reducing prices.
In addition, it has more than 150,000 square meters of bonded warehouses in Hangzhou, Zhengzhou, Ningbo and Chongqing, making it the largest bonded warehouse enterprise in cross-border e-commerce.
In addition to having the traditional tab for the purchase with the categories products, best-sellers and internal search engine, Kaola also has a section called "wish list", similar to a forum from which you can get advice and feedback on all types of products.
Even though Tmall and JD.com are the leading e-commerce platforms in China, Kaola also generates a lot of traffic, with 7.6 million monthly active users, right after Xiaohongshu (12.3 million users).
With the growing use of online platforms, it is not surprising that e-commerce platforms are now being used by almost the entire Chinese population. However, it is important to point out that the so-called generation Z represents the majority of users in the online commerce sector.
If we take the example of Kaola, 39.1% of its users are under the age of 24, 35.73% are between the ages of 25 and 30 and only 6.14% are over 41 years old . The data of the gender of users is important, in fact in 2020 80% of users were women and only 20% of users were men (source Statista analysis).
In terms of income it is considered an e-commerce platform used mainly by the Chinese middle class. In fact, 28.41% of users earn between 10,000 and 20,000 yuan, 25.86% below 3,000 yuan and only 7.64% more than 20,000 yuan (source Statista analysis).
The main products demanded by buyers are infant formula and baby products, packaged food and nutritional products, cosmetics, home and personal care products, clothing and accessories, and small electronic products.
Kaola has set its standards for online shopping through its commitment to the quality, authenticity and variety of products it offers, covering more and more product categories, from food, beverages, clothing, electronics and cosmetics.
According to Statista, it is the most trusted platform among Chinese consumers. In fact, 38.8% of the interviewees are sure of the authenticity of the product purchased, a better result than that obtained by competitors Tmall and JD.
On the other hand, Kaola provides a complete solution for foreign manufacturers to enter the complex Chinese market. By managing cross-border logistics, warehouse, online operations and after-sales services, it enables Western manufacturers to reach consumers on a larger and faster scale.
Finally, it is extremely customer oriented, giving its users the chance to win prizes such as coupons or products and developing interactive games during special events. It has also developed a QR code-based product traceability system with Chinese customs. This helps ensure the authenticity and quality of the goods sold.
Chinese consumers are very cautious when it comes to buying products online, they prefer to shop on popular e-commerce platforms. However, selling products on Tmall and JD.com requires a number of documentation and you will need to meet certain prerequisites.
In fact, given all the stringent conditions to be met, it can be difficult for small brands to access these platforms. Before starting, it is suggested to do a market alalysis, to understand the potential of the products to be sold in China, by defining a pricing and marketing strategy.
If you have a small budget and a brand not yet known in China, Kaola is certainly one of the best solutions to start.
Tools like Noziroh Hub are essential for successfully selling products in China and managing export processes. The risks of failure are around the corner and only through in-depth market research is it possible to verify the feasibility of a project and avoid unexpected events.
With Noziroh Hub it is possible to manage all stages of marketing relying on a single reference: market research, opening / management of stores in the main Chinese e-commerce platforms, storage of goods, order fulfillment, opening / management of Chinese social profiles, packaging and private label.
Author: Alessandro Ave
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