Difference between Chinese marketplaces Taobao, 1688 and Alibaba

• Taobao open platform
• Tmall commerce platform
• 1688.com marketplace for dropshipping and wholesale   
• Business with Alibaba

OT Commerce connects various popular marketplaces to create an online reselling business: famous Chinese marketplaces Taobao/Tmall, 1688, Alibaba, AliExpress, JD and American Ebay and Amazon. Let’s compare Taobao/Tmall, 1688 and Alibaba in this article.

These marketplaces are all owned by Chinese giant of business and e-commerce — Alibaba. At the same time, there are significant differences in their work. Let’s figure out which ones and also try to determine how to use these marketplaces for organizing your own online business.

Taobao open platform

Taobao is the leading online shopping marketplace in China. It was founded in 2003. Taobao is a retail marketplace where a large number of Chinese sellers offer their goods at retail prices to end customers.

You can find almost anything on this marketplace because goods number exceeds seven hundred million. Products range is simply amazing in its diversity. At the same time, goods prices are very low and affordable to a large number of consumers even for resale.

Taobao website is very convenient, there is a seller rating and numerous customers’ reviews for choosing a product which significantly reduces the risk of buying low-quality goods.

There is one significant disadvantage — the marketplace is focused only on the Chinese domestic market. This means that all information is available only in Chinese, delivery is carried out only within China, prices are presented in yuan, and you can pay for goods only by national payment methods such as AliPay (this is the largest Chinese payment system). You also need a Chinese phone number to register on the website. Thus, this marketplace is closed to foreign buyers.

Despite this, Taobao is popular among Chinese buyers as well as customers around the world. Customers from different countries want to buy goods on Taobao. After all, here you can find those goods you can’t find anywhere else. This is where Taobao’s intermediaries are required. They help to buy on Taobao and resell Chinese goods in different countries.

Tmall commerce platform

Taobao Mall (Tmall) is a marketplace based on Taobao. Currently, Tmall offers a large number of branded goods which are significantly cheaper here than in regular stores. 

Please note that Taobao includes a large number of fake products, so it’s better to buy brands on Tmall.

Tmall and Taobao are not competitors, Tmall is part of Taobao. Therefore, we consider them as one commodity provider in our system.

So, Taobao is one of the largest marketplaces, known worldwide. It occupies a significant share in the global Internet market and is among ten the most popular e-commerce services. Its annual turnover is more than 15 billion dollars.

Taobao/Tmall reselling business is perfect for e-commerce beginners. The scheme of work is simple and easy to understand. You can open an online store with a resale shop OT Box and any logistics company will help to organize goods delivery. You can find and choose it on the Internet based on the most suitable working conditions.

1688.com marketplace for dropshipping and wholesale 

1688 is another Chinese largest domestic-only marketplace. It was founded in 1999. This is a marketplace for goods manufacturers focused more on wholesale buyers who buy a large number of goods at once.

Therefore, batches of goods are sold on 1688. Many sellers initially set a minimum price cap for the order value or goods quantity for one deal. Therefore, goods prices become more attractive, since the more you buy, the lower is the unit price. However, in recent years, some sellers have added the opportunity to order goods piece by piece, so the marketplace is wholesale and retail now.

Website interface, as well as Taobao, is presented only in Chinese, delivery is carried out only within China, prices are in yuan and only national payment systems operate. Besides, goods manufacturers are presented here and it is often necessary to communicate with sellers to clarify order details. This must be done in Chinese, as there is no support in English.

All goods produced in China are available on 1688. Merchants who sell their goods on Taobao can also buy them at 1688 and sell with their own markup. Alibaba and AliExpress sellers also follow this scheme. They often don’t even buy goods to their warehouse but simply post them on the website and purchase the necessary amount of these goods on 1688 when they receive an order.

1688 is ideal for an online resale business but there are difficulties when ordering batches of goods. Therefore, it will be suitable for experienced entrepreneurs in Chinese business.

Business with Alibaba

Alibaba is an international analogue of 1688, also aimed at wholesale buyers, but outside of China.

The Marketplace website is translated into various languages and delivery is carried out to different countries of the world. Nevertheless, when buying privately, you need to contact the sellers and clarify order details. This is much easier to do here than on 1688, as there is support in English. Another significant difference from the previous two trading platforms is that you can pay for goods using international payment methods, such as Visa or MasterCard.

Prices are significantly higher here than on1688. You can get a discount only when buying in bulk. This is not very beneficial for small and medium-sized entrepreneurs, as well as online stores operating on the dropshipping system, when you do not need to purchase goods at all.

Another big disadvantage of Alibaba is that it has a bad reputation for protecting consumer rights. For example, there are various transaction protection systems on 1688, so you shouldn’t worry about your funds security. Such protection exists only formally on Alibaba. It’s almost impossible to get a refund. This is explained by the fact that intermediaries act as goods sellers and there are practically no manufacturers on Alibaba. As a rule, such intermediaries receive orders first, and then look for goods for it. And the markup they set on their services: customer support in English, assistance in finding goods and invoicing in an international format.

In addition, the Alibaba assortment, compared to Taobao and 1688, is not so rich in unique goods, but on the contrary, there are a large number of fakes. Be careful when ordering goods there. Therefore, the marketplace is suitable only for those entrepreneurs who know exactly which Alibaba sellers they can deal with.

Comparison table between Taobao, 1688 and Alibaba

	Тaobao/Tmall	1688	Alibaba
Business type	retail	retail and wholesale	wholesale
Price level	low retail prices	the lowest prices among Chinese marketplaces, as sellers are goods manufacturers	high prices, as the marketplace is aimed at foreigners
Individual order	no	yes	yes
Goods assortment	wide	wide	narrow
Delivery geography	only within China	only within China	worldwide
Language barrier	communication with sellers is only in Chinese	communication with sellers is only in Chinese	there is customer support in English
Payment for goods	Chinese payment systems	Chinese payment systems	international payment systems
Trade protection	real, goods sellers care about their rating and reputation	real, goods sellers care about their rating and reputation	formal, since intermediaries act as goods sellers
Fraud probability	low, goods sellers care about their rating and reputation	low, goods sellers care about their rating and reputation	high, as foreigners are easily deceived

Thus, Taobao is suitable for beginners who want to become intermediaries and open their own online store. 1688 will be convenient for those who already have experience in business with China, but Alibaba should only be chosen if there is accurate information about reliable sellers on it.