After "streamlining" during the 618 Shopping Festival, Tmall achieved high-quality growth.
More than a month ago, when Tmall announced its promotional strategy for this year's 618, many industry insiders were very surprised.
Tmall has opened up a new way of simplifying promotional activities. The "full - reduction" strategy that has been used for many years has been replaced by "instant reduction", and the large - value coupons that require customers to reach a certain amount of purchase have been replaced by new "10% off coupons without a minimum purchase".
The "math problems" that consumers had to solve every year are gone. Consumers are now facing a major promotion with direct discounts across the board, just like in the first Double 11 in 2009. Brand merchants can also benefit from this, as they no longer have to deal with the additional return rate caused by order - combining.
However, this also means that the GMV driven by order - combining is gone, and the platform and merchants have to face more challenging growth tasks.
Since the second half of last year, whether it's competing on price or traffic, the "involution - style competition" has reached its end. There is a consensus in the e - commerce and even the entire consumer industry that it's necessary to improve the quality of products and the efficiency of merchants' operations.
However, the challenges that led to the "involution" situation have not disappeared. The investment in the consumer market is recovering slowly, a large amount of production capacity for consumer demand needs to be upgraded, the buyer's market persists, and consumers remain rational and focus on the sense of gain and experience. The leading platforms in the industry must come up with new solutions to deal with these challenges and reshape the e - commerce consumer market as soon as possible.
The changes in the promotion mechanism often serve as a weathervane. The platform's attempt at such a significant adjustment means that a whole set of new business logic has emerged behind it.
At the beginning of this year, Tmall introduced a set of strategies with a sense of trade - offs to "support high - quality original brand merchants", including increasing incentives for brand merchants, investing more in new products, and providing greater support for the platform's 88VIP members and brand members.
Judging from the actual performance of this year's 618, Tmall has undoubtedly found a successful new path.
01. The 618 Event: Eliminating the False and Retaining the True
This year, Tmall's 618 has only one official promotion method - "Official instant reduction starting from 15% off". On top of the instant reduction, consumers can also stack other discounts, such as large - value consumption vouchers for 88VIP members, category - specific vouchers for beauty and fashion industries, and red envelopes from live - streaming rooms.
Starting from the second stage, the large - value consumption vouchers for 88VIP members, which used to follow the full - reduction logic, have also been updated in form and become "10% off vouchers without a minimum purchase".
That is to say, in previous years, a "150 - yuan off for every 1500 - yuan purchase" coupon could only be used when the purchase amount reached 1500 yuan. But this year, it doesn't matter if the amount is less than 1500 yuan. It can directly offer an additional 10% discount on top of the platform's 15% off.
The complicated promotion methods of Taobao Live in previous years have been simplified to mainly "deposit red envelopes". From the start of the sale to June 16th, the number of people who received deposit red envelopes exceeded 27 million.
As of 24:00 on June 18th, 453 brands achieved a transaction volume of over 100 million yuan on Tmall's 618, a year - on - year increase of 24%. 81 live - streaming rooms achieved a transaction volume of over 100 million yuan, and the transaction volume of state - subsidized categories increased by 116% compared to last year's Double 11.
What's more noteworthy is that, according to Tmall, the number of purchasing users increased by double - digits year - on - year during the entire 618 period this year.
Facts have proved that this promotion form is not only simpler for consumers, but also welcomed by merchants who are freed from repeated returns. With the monthly active users of the Taobao APP approaching 1 billion, which is close to the total number of Chinese netizens, simplifying the promotion rules can effectively lower the threshold for participating in the major promotion and attract many consumers who don't want to "do math problems".
According to the calculations of the data institution Analysys, the GMV growth rate of Taobao and Tmall reached 9.2% during the entire 618 period this year.
It's not easy for the platform that the GMV can still grow while the full - reduction promotion is cancelled and the promotion mechanism is simplified during the 618 event.
GMV (Gross Merchandise Volume), the "North Star indicator" used by e - commerce platforms to measure their performance, is calculated as long as an order is placed. All unpaid, cancelled, rejected, and returned orders contribute to the GMV. In the early days, these orders that were not actually sold only accounted for a small part of the GMV.
However, as e - commerce in China covers over 1 billion consumers and enters an "involution" era with a slowdown in growth, the e - commerce sales volume has become more and more "bloated" year by year. The industry generally found that during last year's 618, the return rate of some categories on some platforms could be as high as 70 - 80%.
The "water content" in GMV first comes from the traffic logic. In the highly entertaining live - streaming sales model, impulse consumption has brought inflated GMV to categories such as women's clothing and beauty products, and a large part of them are eventually returned.
The women's clothing live - streaming brand "Lola's Code", which closed its store during last year's 618, once said in an interview that its return rate was 30 - 40% in 2021 and soared to 70 - 80% in 2024, which directly dragged down the brand's operation.
Secondly, it comes from the flooding of the "lowest price in the whole network". In order to cope with the abnormal low prices, many merchants choose to reduce the quality of products and services, and there has even emerged a "no - inventory model" of copying and reselling. This has caused a large number of problems where the goods do not match the description. On the Black Cat Complaint APP, there are as many as 94,000 such complaints, which further increased the return rate.
Competing on traffic and price is an over - draft of long - term business health for short - term transaction volume expansion, and the classic "full - reduction" promotion method in major promotions has exacerbated this "bloated" situation. Years of order - combining for full - reduction have taught many netizens a set of extreme order - combining techniques, which helped the platform achieve higher GMV but also increased the return rate and the operating costs of merchants.
This logic can no longer be sustained. Both the platform and merchants urgently need to improve quality and efficiency, or at least make business growth more substantial.
The confidence for Tmall to simplify the promotion during this year's 618 comes from the improvement of the long - term operating efficiency of brands.
Canceling complex promotion mechanisms such as full - reduction is equivalent to squeezing out the "water" in the sales volume. Consumers' decision - making process is also shortened accordingly, and their focus can shift away from "order - combining for full - reduction" and return to judging products based on their own needs.
This means that consumption is returning to the essence of value competition. The attention brought to the major promotion by the "lowest price in the whole network" and content traffic in the past must now be carried by the products themselves this year. This poses higher requirements for the platform's mechanism design and the competitiveness of brands and products.
In this situation, the growth of GMV means that Tmall has successfully "reduced fat and increased muscle" during this year's 618. The growth rate of "actual sales by brand merchants" is likely to be higher than the 9.2% calculated by Analysys.
02. Leveraging Growth with the "Supporting the Best" Strategy
Recently, the consulting firm Accenture mentioned in a report titled "Winning Hearts, Winning Growth":
"In the structural changes of the consumer market, both brands and platforms are moving towards a leap of symbiotic quality and efficiency. Compared with the simple growth of sales volume, the quality of growth is becoming more and more crucial."
Judging from the various announcements made by Tmall before, "improving the quality of growth" has been the key word running through the platform's strategies throughout 2025.
In March this year, Tmall announced at its annual TopTalk Strategy Conference that in 2025, it will fully "support the best", that is, support high - quality original brand merchants and promote brand growth.
The "high - quality original brands" defined by Tmall do not necessarily mean large - scale and high - sales brands. In May this year, with the technical support of Taobao and Tmall, the National School of Development at Peking University released a brand list titled "The List of the Top 500 Global Brands in the Chinese Online Market". From Pop Mart, which was recently popularized by LABUBU, to Lao Pu Gold, which has almost become a luxury brand with its traditional gold products, all made it into the top 50 of the list.
They have in common a clear brand image and continuous product innovation.
The two dimensions of brand image and product innovation are the most important long - term values in brand operation, and are also closely related to the "improvement of growth quality" that Tmall encourages brands and merchants to achieve through various supporting strategies.
During the first stage of this year's Tmall 618, from May 13th to May 26th, the core brands in the alcohol category on the Taobao platform increased by 72% compared with the same period of last year's 618. Among them, domestic white wine, wine, and yellow rice wine all achieved double - digit growth. Luzhou Laojiao increased by 433%, Jiannanchun increased by 284% year - on - year, and Gujinggong increased by 153%.
Normally, the Chinese white wine market has been relatively stable, highly relying on offline multi - level distributors to control sales volume and secondary - market prices through "stockpiling". Without a new market segment, it's difficult for a single platform to achieve such growth.
However, subtle changes are taking place. Since last year, it has become more and more difficult to "stockpile" white wine. The post - 95s generation, who have grown up, are silently changing the drinking - forced social culture and prefer "self - pleasing consumption", having a small drink at home with a few friends.
Most white wine brands have unclear brand images among young people, and their products have remained unchanged for years. As the financial attribute of white wine fades and the consumption value returns, brands have started to try to establish a real brand image.
During this year's 618, starting from May 20th, Gujinggong participated in Tmall's Super Member Day for 10 consecutive days. During this period, the store's sales volume increased by 51% compared with the same period last year.
Tmall's most important support for Gujinggong is to find young people across different categories. Luzhou - flavor white wine has its own audience. Tmall matched Gujinggong with potential interested people from the 18 - 29 - year - old young users, who account for 30% of new alcohol customers and maintain double - digit growth.
During the 10 - day event, Gujinggong's membership transaction volume increased by 18%, the number of new members increased by 15%, and the number of 18 - 24 - year - old young consumers increased by more than 20%.
A similar example is Yadea, an electric vehicle brand, whose official flagship store's live - streaming transaction volume increased by more than 80 times year - on - year on Taobao Live during this year's 618.
Traditionally, electric vehicles are not a category with a high online sales proportion. However, during this year's 618, the live - streaming sales of Tmall's automotive industry (including two - wheeled electric vehicles) achieved triple - digit growth year - on - year, and three two - wheeled electric vehicle brands, Niu, Yadea, and Ninebot, achieved a transaction volume of over 100 million yuan.
Why did electric vehicle brands flock to Taobao's live - streaming rooms?
According to the statistics of the China Bicycle Association, the proportion of mid - to high - end electric bicycles in China reached 19.1% in 2024. The standardization and productization process require major manufacturers to establish a penetrative brand image. However, the offline sales system of electric bicycles has always been in a chaotic state and is difficult to support this upgrade.
Taobao Live carried out detailed preparations with Yadea two months in advance, precisely matched with influencers, and guided the concept of limited - time platform subsidies such as "instant price drops" and "price drops plus subsidies" through the store - live - streaming channel during peak hours. As a result, the two new products, T35 and CL9S, launched by Yadea had a sales explosion on the live - streaming night.
A relevant person in charge of the Yadea brand mentioned: "We found that live - streaming is an excellent entry point for launching new products and the most direct way for young users to get to know our products."
03. Tmall Is Not Just Reshaping the 618 Event
The purpose of "supporting high - quality original brand merchants" is to help these merchants improve their operating efficiency, optimize their operating environment, and bring them certain business growth.
Behind the simplification and efficiency improvement of the major promotion is the resurgence of the emphasis on brand value in online consumption. It can be said that the changes that occurred during this year's Tmall 618 are the inevitable result of the grand strategy of "supporting high - quality original brand merchants".
To support these changes, Taobao and Tmall are constantly reshaping themselves.
According to the information previously announced by Taobao and Tmall, there are two main investment directions for the platform this year.
One is to encourage brands to launch their product innovation results on Tmall. Tmall has doubled its resource investment in helping brands make new products popular and tested a new product incentive mechanism for some industry brands from February to March.
According to Tmall, during the 618 period, the overall transaction volume of new products increased by 153%, and a large number of popular products that attracted consumers' attention were born. From the start of the 618 sale to June 12th, the single - product transaction volume of 12 new products exceeded 100 million yuan, 504 new products exceeded 10 million yuan, and 6970 new products exceeded 1 million yuan. The number of new products with transaction volumes exceeding 10 million yuan and 1 million yuan increased by 110% and 192% year - on - year respectively.
The outdoor brand MAMMUT started promoting new products on Tmall in March to warm up for the 618 promotion in the middle of the year.
When the 618 event officially started, MAMMUT's transaction volume in the first few days had already exceeded that of the entire period last year.
Many consumers got to know this well - known professional brand through the "Little Ice Elephant" sun - protection clothing. The starting point for MAMMUT to launch this sun - protection clothing came from a Tmall industry insight report a year ago. At that time, the trend data of the sun - protection category in the Chinese market caught the attention of Rick, the person in charge of the brand's online business in China.
Most Westerners don't like sun - protection when doing outdoor activities and even deliberately expose themselves to the sun. International brands often find it difficult to notice this unique and rigid demand of Chinese consumers. Therefore, MAMMUT has taken the lead in this market segment.
The continuous emergence of new market segments has become a "Tmall phenomenon". In previous major promotions, new brands that can seize a niche market segment on Tmall can find a way out.
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