Another 1 billion yuan! Taobao includes Hong Kong in the free shipping area

Investing 1 billion RMB (Renminbi) to cover 1 billion products, Taobao announced that starting from October 1st, Hong Kong will become a free shipping zone.

On September 26th, Alibaba announced this decision at a Taobao Hong Kong business conference. The specific project is managed by Taobao Tmall for merchant recruitment, while Alibaba International is responsible for user operations and logistics in Hong Kong.

Since August this year, Taobao has been piloting free shipping for clothing in Hong Kong. This time, the free shipping initiative has expanded from clothing to the entire industry. Starting from October 1st, Hong Kong consumers can enjoy free shipping on Taobao purchases over 99 RMB. The promotion covers various categories, including popular categories such as 3C electronics, home organization, sports and entertainment, cosmetics, and skincare.

Ye Jianqiu, General Manager of Taobao Tmall's Overseas Business Division, told Times Finance reporters, "Currently, e-commerce in Hong Kong is growing rapidly. In the future, Taobao will focus on local characteristics and will not adopt a one-size-fits-all approach. The main goal of initiatives such as free shipping and returns is to enhance the local user experience."

Previously, one of the pain points for Hong Kong users shopping online was logistics - expensive shipping fees and difficulties with returns, which to some extent affected consumers' choices for online shopping. One major benefit brought by Taobao this time is the reduction in shipping fees, with the "99 RMB free shipping" offer. Specifically, consumers only need to purchase items with the "HK¥99 free shipping" tag and spend over 99 RMB to enjoy free shipping to Hong Kong self-pickup points or lockers, without paying for cross-border shipping to Hong Kong.

Chen Zijian, Head of Taobao Tmall's Hong Kong and Macau Business Division, introduced that the promotion will last for three months, covering the major sales events of Double 11 and Double 12. Currently, 92% of the products on Taobao support official direct delivery to Hong Kong, with delivery times shortened to 3-4 days.

Times Finance reporters found that the Taobao APP has already launched the promotion content on related pages.

(Image Source: Taobao)

In addition to reducing shipping fees, Taobao has also introduced cross-border return services. Users can return items to mainland merchants at Hong Kong Cainiao self-pickup points if they purchase items with the "Support Hong Kong Returns" tag. However, this service incurs certain fees.

Returns have always been a pain point for cross-border e-commerce. According to information from Alibaba International, Alibaba has communicated with customs and streamlined the process. In the future, consumers can return items locally or directly to mainland merchants. Chen Zijian stated that as transaction volumes increase, Taobao will strive to reduce fees at the appropriate time.

Furthermore, Taobao's official self-pickup point layout in Hong Kong is gradually strengthening. Currently, the number of Cainiao self-pickup points and lockers in Hong Kong has increased to 800, with approximately 400 pickup points offering Sunday and extended evening hours (until 9 pm).

（Image Source: Taobao）

Zhao Yiliang, head of the Cainiao Cross-border Export Logistics Department in Hong Kong, revealed that by the end of the year, the number of Cainiao self-pickup cabinets will exceed 1,000.

In an interview with reporters from Time Finance and others, Zhao Yiliang stated that Cainiao has already established a comprehensive logistics network covering the entire Hong Kong and a well-developed self-pickup network. Recently, Cainiao also provided B2C logistics solutions for local e-commerce, offering services such as door-to-door collection and self-delivery to warehouses for local merchants.

According to Cainiao, currently, mainland delivery stations mainly handle parcel collection, while Hong Kong self-pickup points focus on cross-border parcel pickups, while also providing local delivery services in Hong Kong. In terms of individual parcels, the parcels from the mainland to Hong Kong are mainly shipped in batches, meaning that consumers will purchase several parcels to be combined together, resulting in larger volumes compared to parcels within the mainland.

Prior to this, Taobao has released several positive signals in Hong Kong this year.

In August of this year, Taobao piloted free shipping for clothing in Hong Kong. At the end of last year, Taobao Hong Kong launched the Taobao PLUS service, providing free shipping to Hong Kong for designated products.

Ye Jianqiu stated that based on the growth of orders with free shipping in the Hong Kong region, free shipping services are well-received by Hong Kong consumers. "In the future, free shipping will cover a wider range of categories, and Taobao will also introduce more localized initiatives."

Previously, logistics giant SF Express also identified business opportunities and made moves in Hong Kong.

Time Finance noted that at the end of last year, SF Express launched the "Shenzhen-Hong Kong Half-Day Delivery" service for Hong Kong customers purchasing in Shenzhen, providing home delivery services. Data released by SF Express Group shows that there are over 1,500 SF Express points, stations, smart lockers, and cooperative convenience stores in Hong Kong, and since October last year, they have been providing a "Hong Kong-wide door-to-door, same-day delivery" service.

In recent years, the expansion pace of e-commerce platforms and logistics giants has been relentless, expanding their businesses globally. According to customs statistics, in the first half of 2024, China's cross-border e-commerce import and export reached 12.2 trillion yuan, a year-on-year increase of 10.5%.

However, as platforms deepen their cross-border e-commerce business, higher demands are placed on localization and logistics.

Taking the Alibaba ecosystem as an example, in addition to the domestic market, Alibaba's Taobao is steadily expanding overseas, with Cainiao's logistics capabilities serving as the support point for Taobao's global expansion.

On September 10th, Joseph Tsai stated that Cainiao is aiming to open up to the market.

He believes that e-commerce is a track full of growth potential, and logistics, as a supportive service, should be customer-oriented. Only by facing an open market and diverse customer demands can more market-oriented service capabilities be honed.

The day before Joseph Tsai's statement, on September 9th, Cainiao announced the acquisition of a 5.95% stake in the cross-border e-commerce logistics service provider 4PX through capital increase, holding a 50.95% equity stake after the acquisition, achieving controlling interest.

And a month ago, Taobao launched the "Global Free Shipping Plan for Large Apparel," charging eligible merchants a corresponding supply chain management service fee to enable overseas buyers to enjoy cross-border free shipping The initial phase of the project covers Asian regions such as Singapore, Malaysia, South Korea, Hong Kong, Macau, and Taiwan, with specific free shipping thresholds ranging from 49 to 199.

In addition to expanding outward, Taobao is also actively focusing on internal operations.

Just a few days ago, Taobao Tmall announced that this year's Double 11 will heavily invest in two "billion-dollar red envelope" campaigns, aiming to stimulate growth and reduce costs.

According to Taobao Tmall, in terms of stimulating transactions, this year's Tmall Double 11 will not only have discounts and instant deduction activities but will also additionally invest 30 billion in consumer vouchers and red envelopes to facilitate transactions for all merchants. Furthermore, Tmall Double 11 will invest billions in purchasing traffic to help merchants expand their customer base.

In terms of cost reduction, there are four strategies: firstly, the introduction of the "Return Insurance" service, which can achieve up to a 30% direct cost reduction; secondly, providing merchants with a zero-fee rapid refund service; thirdly, for merchants participating in the "billion-dollar subsidy" program, the platform will fully refund the Tmall commission for products participating in the subsidy program; fourthly, Tmall Double 11 will completely waive commissions for major promotions, live broadcasts, and will unbind shipping insurance for Taobao merchants, comprehensively reducing operating costs.

(Image Source: Tmall Official)

As the e-commerce battle reaches halftime, for Taobao, maintaining market stability and expanding overseas are both crucial strategies