In the competition between adidas and Nike for dominance of China’s activewear market, Alibaba’s Tmall is a key battleground.
That may be one reason why adidas recently announced a new cooperation agreement with the e-commerce giant that kicked off with the February 21 launch of the brand’s new UltraBOOST sneaker. Tmall featured ads for the launch on its homepage as part of its Super Brand Day promotion, a marketing event in which Tmall heavily promotes a single brand on its site that often highlights an exclusive product launch. A Tmall/adidas Weibo livestream was also broadcast featuring actor Deng Lun and Olympics gold medalist swimmer Ning Zetao with links to purchase the new shoes on Tmall. In addition to product launches like this one, Tmall and adidas also agreed to work together on the areas of new retail, customer service, and development of new products using Tmall data.
This new strategic relationship could help to close an existing Tmall performance gap between adidas and Nike. According to Gartner L2’s Activewear: China Insight Report, adidas trails Nike in presence on both Tmall and JD.com first-page search results. Both adidas and Nike joined Tmall’s “one-billion RMB” club for making more than that amount in sales on the annual Singles Day online shopping festival, but Nike was the clear winner. It noted in a recent earnings call that it was the top activewear brand on Tmall for Singles Day with its overall business for the day up more than 40% from the year before.
As adidas remains nearly tied with Nike for market share in China, Tmall will be a crucial deciding factor in which brand takes the lead. According to Chinese media, adidas’ Tmall flagship is the brand’s number one store globally by sales volume. In addition to online promotions, adidas will also take its Alibaba partnership offline with Tmall-integrated smart stores in China that will include online-offline promotions, shopping guides, and synchronized inventory allowing in-store pickup of online orders.