That growth has been close to nearly 60% in the first six months of 2020, growing to 25% of its retail market, Alibaba’s New Zealand country manager Pier Smulders said in a speech at Spring Sheep Milking Company’s open day.
“When you consider that’s a US$5 trillion market, that’s a big number,” he said.
“It was sitting around 18-19% last year, so that’s a big shift in such a big market.”
Product categories such as alternative dairy are competitive in China, meaning companies had to be operationally capable of marketing the product to consumers.
Spring Sheep were doing that, he says.
At the open day, there were two staff members from the sheep milking company livestreaming the event back to consumers in China.
“It’s about knowing how to connect to the Chinese consumer,” he said.
“They have a really good end-to-end insight into how it all works, there’s great stories with some of the families who are farming for them, they have obviously got the environmental story and the animal welfare story with the less intensive nature of sheep dairy. I think they have got a very good story.”
In July, Spring Sheep started selling its products through Alibaba’s Tmall channel. From August to September, sales through its Tmall Global Flagship store more than doubled.
“It is the place in China where premium overseas brands get introduced to Chinese consumers,” he said.
“It’s a perfect entry point for brands like Spring Sheep to target those Chinese consumers looking for those imported brands.”
It was the largest cross-border platform in China, meaning the products being sold on Tmall did not have to be formally China registered.
Dairy company A2 built its Chinese business on this platform.
He says it’s the place to launch brands and attract young affluent Chinese consumers.
China’s Single’s Day – the largest shopping event in the world – takes place on November 11, and Spring Sheep is the top category for sheep’s milk powder during that event.
“It reinforces what you see here today, that these guys know what they are doing,” he said.
Last year, US$38 billion was transacted on Single’s Day, he says.
“It’s not a clearance sale, it’s a way to recruit new consumers to your brand. It’s a way for Spring Sheep to find new consumers who become loyal followers of the brand in the future,” he said.
Smulders worked with 700 New Zealand brands that include Spring Sheep to help their products reach Chinese consumers.
He says the value of the goods and services sold via Alibaba was about five times NZ’s GDP.
Since 2016, the sales revenue of NZ dairy products on this platform has increased by 250%.
“This is a big market and a big opportunity growing very fast and (it) will continue to grow fast, especially in the post-covid world where you have the shift to online,” he said.
He says Chinese consumer demand was very resilient and this was good news for NZ, given the amount of premium products are sold to Chinese consumers.
