Alibaba works with Douyin to attract new users ahead of midyear shopping festival

Alibaba Group Holding’s Taobao and Tmall Group is working with ByteDance-owned Douyin to attract users from the Chinese short video platform, as the e-commerce giant spends hundreds of billions of yuan for its promotions in the mainland’s annual midyear shopping festival.

The domestic e-commerce unit of Alibaba, which also owns the South China Morning Post, recently joined hands with Douyin, the Chinese version of TikTok, to help merchants on the Taobao and Tmall platforms acquire customers from the short video app’s users, according to information provided by the group on Monday.

The so-called “Star Cube Plan”, jointly launched by Alibaba-affiliated digital marketing platform Alimama and Douyin’s digital marketing tool Xingtu, aims to help the merchants achieve “marketing on Douyin, transaction on Taobao”, according to Taobao and Tmall Group.

The merchants will be able to post advertisements on Douyin, and monitor how users are directed to, browse and make purchases on their Taobao and Tmall stores after seeing the ads.

The move marks the latest in a series of efforts by the domestic e-commerce unit to seek new growth by attracting customers from other platforms through external cooperation, as the top player in China’s online shopping market is grappling with heightened competition with newer rivals including PDD Holdings and even Douyin itself.

The company has so far reached such deals with more than 200 online platforms including those of Shenzhen-based tech giant Tencent Holdings, it said.

Last September, Alibaba and Tencent announced a deal to place ads on WeChat’s short-video sharing platform Channels, which can be linked to shops and live-streaming rooms on Taobao and Tmall. That followed similar previous collaborations with blogging features and mini-programmes on the ubiquitous social media app.

Alibaba’s collaboration with Douyin, which comes ahead of China’s second-largest online sales event – the 618 shopping festival – is also among a slew of measures unveiled on Monday by the Taobao and Tmall Group to encourage consumers and merchants to participate in the midyear campaign.

The unit said it has allocated over 200 billion yuan (US$27.7 million) – the highest amount in its 618 festival history – for a rapid settlement programme for eligible merchants, to ease the cash flow pressure especially for small and medium enterprises.

It is also partnering with Alibaba’s logistics unit Cainiao and fintech spin-off Ant Group to provide logistics subsidies and shipping insurance deals, while currently offering free access to more than 10 artificial intelligence tools for all Taobao and Tmall merchants.

On the consumer side, the unit said it will give away over 10 billion yuan in coupons to more than 35 million 88VIP members and another 5 billion yuan for live-streaming rewards, specific categories, and virtual sales venues.

It also upgraded the price guarantee feature for this year’s event, allowing Tmall consumers to receive a refund on price differences until July 5, in case of any further discounts given after their purchases.

Rolling out in the weeks leading up to June 18, the shopping event will see major e-commerce players from Alibaba to JD.com competing for shoppers with steep discounts, cash subsidies and colourful marketing campaigns.

Alibaba is set to kick off the first sales window for the 618 event at 8pm Monday, followed by a second starting at 8pm on May 31, after announcing earlier that it would skip a presales stage this year, which used to allow consumers to make a deposit on goods they wanted to buy to guarantee a low price during the actual sales period.

JD.com, Alibaba’s long-time rival in e-commerce, has undertaken a similar move this year to start direct sales of its 618 event on May 31.