Why does Tmall choose Lazada as its first stop when its brands expand into Southeast Asia?

The olive branch extended by Southeast Asian local platforms to Tmall brands.

Text by | Peng Qian

Edited by | Qiao Qian

Source | 36Kr Future Consumption (ID: lslb168)

Cover image source | Provided by the company

The Southeast Asian market is a fiercely competitive arena for e-commerce companies. With Shopee and Lazada engaged in a fierce battle earlier, and now TikTok making heavy investments and Temu testing the waters, how can one break through the competition?

Lazada's current answer is: Leveraging the organizational dividends brought about by Alibaba's e-commerce business group integrating domestic and international operations, it is investing unprecedented energy and resources, and making "brandization" its top strategy.

This 13-year-old Southeast Asian local e-commerce platform became one of the first initiators of "Harbolnas" (Indonesia's Global Online Shopping Day) in its first year of establishment, with local brand merchants' products accounting for more than half of those participating in the major sales event. After being officially acquired by Alibaba in 2018, Lazada started more brand-related layouts. It not only introduced the "Double 11 Carnival" invented by Tmall in quick succession but also launched LazMall, similar to Tmall Mall, in 2018.

Since then, LazMall has continuously introduced local brands and international big brands. Local brands include Wardah (an Indonesian beauty brand) under the Paragon Group, and international brands include L'Oréal, Swiss, Skechers, MamyPoko (Japanese diapers), König Pilsener (German beer), Daniel Wellington (Swiss watches), etc. The official claims that LazMall is the largest online brand mall in Southeast Asia.

Three years ago, Alibaba International established an organizational form that combines horizontal and vertical strategies (the horizontal global cross-border market is led by AliExpress, and the vertical local e-commerce is led by Lazada), and also clarified a new strategic direction - when it comes to the Lazada business, it is a firm commitment to "brandization".

This strategy not only plays to its own advantages but also is the result of observing market changes. Data from the "2025 Southeast Asian E-commerce Report" shows that Lazada has the highest proportion of middle-class users among Southeast Asian e-commerce platforms. However, based on the scale of 150 million middle-class users and the continuous expansion, there is still significant room for growth. Southeast Asian middle-class consumers who pursue quality and branded products are becoming the mainstream user group of Lazada. Lazada defines them as "quality users".

Based on these changes, Wei Meng (nickname: Qiancheng), the President of Lazada, regards the "system-level" connection with Tmall as an important current strategy. Qiancheng joined Alibaba in 2009. In the early stage, she focused on Taobao's user products and operations, and later her responsibilities expanded to the large FMCG and import industries. She has rich product experience and synergistic advantages within the large e-commerce sector and came to Lazada in 2022.

The "system-level" connection between Lazada and Tmall means that the inventory, marketing, and prices of a merchant's Tmall store can be "mirrored with one click" to the corresponding Lazada store, helping Tmall merchants achieve "lightweight" overseas expansion at low cost. While doing well in the domestic market, they can simultaneously conduct cross-border business in Southeast Asia. The first batch of Tmall brands to settle in Lazada under this project includes AfterShokz, Bananain, babycare, Philips, Lock&Lock, etc.

This is also the organizational integration dividend that the establishment of Alibaba's e-commerce business group brings to Lazada. Qiancheng told 36Kr, "Previously, there was no fundamental difference between what we did for brands and what other external platforms did. We needed to conduct business development (BD) with merchants on a one-to-one basis. Now, through the connection of system resources, we can communicate with Tmall's industry managers and become part of their merchant operation plans."

The great era of Chinese brands going global has arrived. From the perspective of an e-commerce platform, Lazada also believes that there is not only the path of low-price competition. "Brandization and quality improvement" are one of the major directions for going global today. The fact that consumer brands and hardware brands such as Pop Mart, Insta360, Anker, and Ugreen have flocked overseas and achieved success has proven this point.

Yesterday, 36Kr met Qiancheng in Area C of the Xixi Campus in Hangzhou. We talked with her about the history, current situation, and subsequent plans of Lazada's "brandization" strategy, as well as how to help merchants more accurately find business opportunities and do the right things in the new golden era of Chinese brands going global.

She also revealed to 36Kr that this year on Double 11, Lazada will conduct its first assessment of the initial results of the "brandization" strategy and evaluate its performance among merchants and users because "the prices are good during Double 11, and the scale of merchant recruitment has also increased."

The following is the dialogue between 36Kr and Qiancheng (edited and revised):

01 The 'brandization' strategy is clearer, and Tmall brands will bring the greatest incremental growth

36Kr: When did the 'brandization' strategy become clearer and more resolute?

Qiancheng: It's difficult to pinpoint a specific time. 'Brandization' is something that Lazada has been doing since its establishment. The current strategic choice has been gradually solidified through a series of trial and error and internal discussions. From the perspective of industry development, Chinese brands going global to Southeast Asia can see new market opportunities. It's indeed time to elevate this matter to a strategic level for discussion. Lazada is still in the process of doing this and is far from completion.

36Kr: What progress do you think has been made?

Qiancheng: Southeast Asia has a population of 700 million, and the middle-class population has increased sharply to 150 million. Their consumption power is comparable to that of the Chinese middle class. Currently, Lazada has the highest average order value, the highest brand user penetration rate, and the highest growth rate in brand transaction share among Southeast Asian e-commerce platforms.

36Kr: Lazada actually started brand layout a long time ago. What's the special significance of connecting with Tmall?

Qiancheng: Previously, Lazada did focus more on local operations, aiming to operate local and international brands well. At that time, the brand resources and team insights were all oriented in that direction, and it was reasonable to make it the main line. After the integration of the large e-commerce sector, the ability to connect with Tmall at the underlying system level is indeed one of the dividends brought about by the organization.

36Kr: What specific dividends are there?

Qiancheng: Through the system-level connection between Lazada and Tmall, Tmall stores can be directly mirrored to Lazada. One advantage is the integration of inventory. All product details are intelligently translated through AI, and other aspects such as pricing, customer service, and logistics will be resolved step by step. Another advantage is the synchronization of marketing prices, allowing overseas consumers to experience the price competitiveness of Tmall and recognize high-quality Tmall brands in batches.

36Kr: If there was no integration, how much more difficult would it be to do this?

Qiancheng: Previously, our main method of brand development was to conduct one-on-one BD with merchants. But now, we are operating on a large scale. When Tmall's industry managers operate Tmall merchants, they will communicate with Lazada together, and Lazada has become an important part of their plans.

36Kr: Do we have an expected proportion target for the contribution of Tmall brands to the platform's growth?

Qiancheng: I generally don't like to talk about proportions. Lazada regards Tmall brands as an incremental supply. We hope that in the future, they can provide the greatest incremental growth for the Lazada platform. We are doing both local and cross-border business, all centered around one main line - brands. In essence, we still need to return to consumer demands. We hope to help local brands continue to operate well on the Lazada platform and bring in more global brands with business opportunities to provide high-quality supply to local consumers.

36Kr: Alibaba's overseas e-commerce business is generally on the rise. Both Lazada and AliExpress are pursuing brandization. What are the differences between them?

Qiancheng: Brandization is definitely a global consumer trend, and there is such an understanding and awareness within Alibaba's international business segment. However, first of all, there are differences in market and regional positioning. Lazada is a local e-commerce platform deeply rooted in Southeast Asia, which is a clear incremental business position for Tmall merchants who want to expand their business in Southeast Asia. Secondly, there are also differences in the design of the business model. We call this model Lazada Brand Co-Pilot. The biggest feature of this model is that the brand merchants always have the main control over the operation of their overseas stores. Lazada's role is to provide support and escort for merchants to go global more stably, quickly, and intelligently, and is responsible for providing the necessary local insights and intelligent full-link empowerment to merchants.

36Kr: What is Lazada's overall goal at this stage?

Qiancheng: Currently, all the series of operational improvements made by Lazada have met expectations. Next, the main task is to implement the brandization upgrade strategy well and enter a stage where the platform achieves targeted growth around the new upgrade strategy.

02 There are greater opportunities for short-tail categories to go global in the short term, and in the long term, heavy investment in localization is a must

36Kr: From the platform's perspective, which categories have great opportunities in this wave of going global?

Qiancheng: There are some even very minor pain points in the consumption trend where the local supply is actually insufficient, and there is a high degree of product shortage. This is the clear business opportunity we have discovered. For example, there is a strong demand for consumer electronics brands in Southeast Asia. Local consumers like sports and outdoor activities. We have introduced the cost-effective Insta360 waterproof panoramic camera and the portable and cost-effective Jisu handheld fan, which are very popular.

Another example is that in the Chinese beauty market, consumers pay more attention to color numbers, with the demand for "brightening and reducing yellowness". In Southeast Asia, the core demand for beauty products is "long-lasting makeup" because of the hot and humid weather. Caror Natural has a powder foundation called "Black Magnet" that focuses on long-lasting makeup and has a good reputation in China. It is also selling well in the Southeast Asian market at present.

36Kr: Which categories will be prioritized in the early stage?

Qiancheng: In the early stage of the project, we are still streamlining the process. There will be more short-tail industries because they are more standardized, and the process can be quickly established. The sales of single products can be easily scaled up, such as consumer electronics and beauty products. For long-tail products like clothing, there is a high demand for returns and exchanges, and accurate product selection is required. The entire operation process is more difficult, and the process will be longer. In the early stage, we have introduced some corresponding domestic and international categories. Later, we will provide more personalized services based on the wishes and needs of merchants.

36Kr: Brands like Pop Mart that focus on "emotional value" have been very prominent in this wave of going global. Can we observe a similar trend on Lazada? Do you have targeted operations for such brands?

Qiancheng: Lazada focuses on serving "quality users" well. They are also willing to pay for products with emotional consumption value like Pop Mart. We have a brand IP called "LazRun" - every year, we organize consumers to participate in a 5-kilometer fun run. This year, we cooperated with Pop Mart. Participants in the event wore Pop Mart products, and we also distributed Pop Mart prizes after the event. There were also interactive links with the brand during the process, and the effect was very good. Lazada's local resources help us better meet the brand's marketing, promotion, and other comprehensive requirements in the local area and help the brand better establish an emotional connection with consumers.

36Kr: Chinese brands going global face difficulties in the supply chain, warehousing, and distribution online. Which parts can Lazada help them solve?

Qiancheng: We have different models for different brands. For example, Tmall merchants participating in the "One-click Lightweight Going Global" program can directly mirror a Lazada store identical to their Tmall store. Merchants only need to ship their goods to the domestic central warehouse, and Lazada will help the merchants consolidate the orders to the local central warehouse and deliver the products to consumers through official logistics partners. Some merchants also choose the local inventory model. For some brand manufacturers with overseas logistics capabilities, we can also help diagnose their needs and help them participate in local operations more efficiently.

36Kr: What are the generational differences between this wave of brand going global and previous ones?

Qiancheng: The brand power and product power of Chinese brands are reflected in different industries and tracks and have gone through several eras. In the past, it was mainly high-cost-performance light industrial products. With the changes in the times, there have been some high-tech electronic devices, beauty and skincare products, and trendy toy IPs that provide emotional value. For Lazada, introducing these good Chinese brands is just the first step. If a brand wants to go global in the long run, it must develop specific products for the local market, customize products, and combine in-depth supply chain development with local operations. It will become a more resource-intensive and customized model. Many brands are not unwilling to take this step but think that the cost of taking the first step is too high.

This article is from the WeChat official account "36Kr", author: Peng Qian.