Alibaba hosted its first-ever 8.8 Members Festival on August 8, 2017. The event featured exclusive discounts on products, entertainment and VIP shopping sessions for its members. The previous month, Alibaba announced that it had completed the integration of the membership programs of Tmall and Taobao to create a single comprehensive membership program across its e-commerce platforms. On August 2, Tmall unveiled a new Luxury Pavilion for Chinese consumers that provides a level of exclusivity and a similar tailored experience to shopping in a physical store (see Five Reasons Tmall’s Luxury Pavilion Is Well Positioned to Ride China’s Consumption Wave). We believe Alibaba’s focus on an integrated membership program highlights the transition of its strategy from acquiring new traffic and users, to further deepening its relationships with its loyal and high-spending members. We expect Alibaba to continue to roll out more New Retail-related initiatives to cater to this group of consumers.
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Alibaba hosted its 8.8 Members Festival on August 8, 2017 to reward its most loyal shoppers on its e-commerce platforms. When pronounced in Chinese, “88” is a homonym of “BABA,” which is also Alibaba’s ticker on the New York Stock Exchange.
The 8.8 Members Festival encompassed:
For our reports on Intime and Alibaba’s New Retail initiative, please see:
Alibaba’s 88 Membership program is part of its effort to appeal to mid- to high-end consumers by offering a range of exclusive upscale products and services on its various e-commerce platforms. Top-tier members of the program are entitled to faster access to various participating brands’ offerings, limited editions and personalized products and services.
In June 2017, Alibaba announced that it had completed the integration of the membership programs of Tmall and Taobao. Under the integrated program, members are categorized into three membership tiers based on their spending history on Alibaba’s platforms (including Taobao, Tmall, Taopiaopiao, etc.) in the past 12 months. The reward points will capture each member’s average ticket size, purchase frequency, interaction and credibility. The three membership tiers are:
Members are entitled to various discounts throughout the year. During the 8.8 Members Festival, a Super Member can receive discount cards, including a Tmall Supermarket discount card, which entitles them to a 12% discount on purchases all year round, and membership cards for brands such as Godiva and Levi’s, which entitles them to a 12% discount on all
According to data from Alibaba, only about 3% of its platforms’ active users qualify to be Super Members.
The 88 membership program was backed by 50 top global brands, offering exclusive deals and promotions to members. One of the first was the partnership with Marriott International that was announced on August 7. The brands that Alibaba is partnering with span the food and beverage, healthcare, sportswear and cosmetics verticals and include L’Oréal, Rimowa, Godiva and New Balance.
Data can help retailers “better meet demand” and “create new demand,” according to Alibaba CEO Daniel Zhang. We highlight the following use cases and future commercial opportunities that Alibaba’s membership program can provide.
On August 7, 2017, Alibaba and Marriott International announced a strategic cooperation agreement that aims to deliver more personalized online travel services for Chinese tourists. Marriott International is headquartered in the US and has a portfolio of 30 hotel brands, including JW Marriott, Ritz-Carlton, St Regis and W Hotels, in about 125 countries. The joint venture will operate the Marriott’s Chinese-language digital channels, including the Marriott and Starwood Hotels websites, the Marriott mobile app and the Marriott storefront on Fliggy, Alibaba’s online travel booking platform. Certain Marriott hotels in select markets will also accept Alipay, China’s leading mobile payments platform affiliated with Alibaba.
Privileges available to Alibaba’s members include:
For our annual report on Chinese outbound tourism, see Deep Dive: Chinese Outbound Tourists—More Diverse, More Sophisticated
We look forward to reporting more updates on further developments of Alibaba’s initiatives.