Alibaba’s Price-for-Quality Brand Taobao Xinxuan to Recede
Taobao Xinxuan, an affiliate shopping channel and product line of Alibaba’s Taobao, will change from an independent brand to providing products for Tmall Supermarket, focusing on young families, LatePost reported on Wednesday.
Under this arrangement, Taobao Xinxuan will be upgraded to a new brand called “Miaomanfen,” which will provide a variety of items for Tmall Supermarket. The first batch of products under the new brand will be sold in mid-April.
Taobao Xinxuan was launched in May 2017. Its predecessor was Taobao’s “Made in China” channel for the manufacturing industry, then it was upgraded to an original design manufacturer (OBM), focusing on high-quality daily necessities.
Alibaba launched Taobao Xinxuan to compete with the rapid development of Yanxuan, a self-operated e-commerce platform operated by NetEase. The price-for-quality platform was launched in April 2016. By cooperating with a number of ODMs, Yanxuan forced down the price of products to only half or even lower. In the second year of its launch, Yanxuan’s sales exceeded 7 billion yuan, an increase of nearly eight times year-on-year.
As Alibaba‘s self-owned brand, Taobao Xinxuan enjoys great support from the e-commerce giant. In 2017, Taobao Xinxuan began to cooperate with leading livestreamers. However, its development was limited by Alibaba.
A prominent advantage of NetEase‘s Yanxuan is the products produced by foundries of well-known brands. However, Taobao Xinxuan can’t even sell clothing and food, because the brand concentration of these categories is high, which will directly affect Alibaba‘s major customers. It is also difficult for Taobao Xinxuan to make independent decisions on its own development.