Jenny Chan 陳詠欣
Mar 7, 2014

Mobile-only Taobao sale highlights fight for future mobile supremacy in China

MAINLAND CHINA - Taobao Marketplace's 24-hour sale, set for tomorrow, is riding on the scorching m-commerce wave as Chinese shoppers increasingly use mobile devices instead of PCs to shop—and as rivals Alibaba and Tencent vie to capture as much of that activity as possible.

Mobile-only Taobao sale highlights fight for future mobile supremacy in China

Chinese consumers can snag discounts at the 'Mobile Taobao 3.8 Life Festival' (“3·8”手机淘宝生活节) when they pre-order merchandise, meals, movies and other products using Alibaba's mobile shopping app.

The company recently upgraded the app, which claims a user base of more than 400 million, to improve online-to-offline (O2O) functionality, allowing mobile phones to be used to purchase products in traditional retail settings. For example, Taodiandian (淘点点), a food catering and delivery service, was launched in December.

Participating in the sale will be 800 restaurants, 37 department stores, 1,500 in-store brand outlets, 230 karaoke parlors and 288 movie theatres all across China, according to (Alibaba Group’s corporate news site). Limited karaoke sessions and movie tickets sell for just RMB 3.80, for example.

The company is promoting the sale as a mobile version of’s '11.11 Shopping Festival', an annual 24-hour online event that last year generated US$5.7 billion (RMB 35 billion) in transactions. About 21 per cent of transactions were completed through mobile devices, up from five per cent during the 2012 festival.

To speed up the adoption of m-commerce, last November Alibaba even gave away free smartphones running Alibaba’s mobile operating systems to willing merchants through a US$82 million (RMB 500 million) investment program. That certainly made it easier for Taobao sellers to make the switch to mobile, but consumers at large still form the major m-commerce battleground.

To get consumers habituated to using mobile phones to pay for goods and services on a daily basis, both Alibaba Group and rival Tencent Holdings have been spending millions to subsidise taxi fares via rebates from using taxi-hailing mobile apps financially backed by them—Kuaidi Dache (快的打车) and Didi Dache (嘀嘀打车), respectively.

The battle further intensifies: Didi Dache is linked to Tencent’s popular instant messaging app WeChat, while Kuaidi Dache is built into Alibaba’s payment app, Alipay.

What's really at stake is future dominance of the country’s increasingly mobile-focused population. Several reports on the growth of m-commerce in China reflect this, though estimates of the pace of growth vary. Statistics recently released by People's Bank of China showed mobile transactions climbed 317 per cent in 2013 to US$1.58 trillion (RMB 9.64 trillion), but this accounted for only three per cent of the country's overall non-cash transactions.

According to Analysys, China's mobile-payments market grew 800 per cent in Q4 2013, with total transactions hitting US$212.2 billion (RMB 1.30 trillion). Alibaba’s Alipay led the market with a 69.6 per cent share, while Tencent’s Tenpay had 3.3 per cent.

What is not subject to debate is how pervasive smartphones have become in China, in striking comparison with other markets. For example, KPMG noted that 55 per cent of 10,000 internet users surveyed have made a mobile payment, versus only 19 per cent of US users.

Chinese consumers have "truly entered the era of mobile shopping”, said Bill Ying, marketing head for Mobile Taobao, quoted on “Mobile take-up is strong in China because the country has skipped out the adoption of the landline and migrated straight to mobile platforms,” added Egidio Zarrella, clients & innovation partner at KPMG China, in the company's report.



Related Articles

Just Published

4 hours ago

Mid-level female creatives don't feel 'heard'

This International Women's Day, we ask mid-level female creatives in the region what their biggest pain points are working in a male-dominated field.

4 hours ago

It's past time to eliminate gender biases in design

From surgical instruments to crash test dummies and virtual assistants, gender biases and stereotypes have been built-into products causing real harm, says the co-founder of Elephant Design.

4 hours ago

IWD campaigns: Angry, funny, clever and inspirationa...

See how organisations and agencies from around APAC have chosen to mark International Womens Day 2021.