Zara to open store on Tmall to boost growth in China
Spanish brand ceding web control and share of profits to Alibaba in targeting the wider audience of China's biggest online retail operator
Since opening its first website four years ago, Inditex has maintained full control of online sales for its flagship brand Zara. To gain a stronger foothold on the mainland, the Spanish retailer plans to partially cede both oversight of the chain's web sales and a share of its profit.
This month, Zara will open an online store on Tmall, a website owned by Alibaba Group Holding, where firms such as Nike and Burberry Group sell their wares.
"Retailers, to launch e-commerce in China, are deciding to launch through Tmall because of the breadth of its audience," said Jamie Merriman, an analyst at Sanford C. Bernstein.
Tmall has sought to allay concern about counterfeiting by requiring retailers to put down cash deposits as a guarantee that their products are legitimate. That anti-knock-off stance has increased the site's appeal to companies such as Inditex, according to Christodoulos Chaviaras, an analyst at Barclays in London.