Amazon Opens Second Storefront On Rival Alibaba's Tmall.com

(RTTNews) - US Online retail giant Amazon.com, Inc. (AMZN) has Friday opened another storefront on Chinese rival Alibaba Group Holding Ltd's (BABA) online marketplace Tmall.com to boost its access to shoppers in China, the world's second largest economy. The move comes just three months after Amazon opened an official store on rival Tmall for its Kindle e-book reader.

Amazon's second digital storefront on Tmall will offer a limited number of product categories, such as women's footwear, toys, imported food and kitchen equipment.

Amazon has had a direct online presence in China for nearly four years after it brought Chinese books, music and video retailer Joyo.com in 2004 and then rebranded it as Amazon.cn in 2011. It has invested heavily in creating a Chinese online retail presence via Amazon.cn.

Amazon houses the imported goods at its warehouses in mainland China, and also handle's all logistics, including order processing as well as shipping and delivery. The same process will continue.

Tmall.com has a more than 50 percent market share of all Chinese business-to-consumer transactions. According to recent estimates by China's iResearch Consulting, Tmall.com had a 57.3% share of China's B2C, and JD.com had a 21.2 percent share, while Amazon.cn had a meager 1.5 percent share.

The Alibaba ecosystem provides digital storefronts to major retailers around the world, including Nike, Inc (NKE) and Apple, Inc. (AAPL) to sell products to a growing Chinese middle class. In return, Alibaba receives a commission on every sale made through its site.

Meanwhile, Amazon operates much like a retailer and makes money through buying and re-selling merchandise.

The current move is expected to boost the recent sag in Amazon's international sales, which made up 38 percent of the total revenue in 2014, compared with 48 percent in 2009. Amazon's international business primarily focuses on the U.K., Germany and Japan, while has had trouble to increase sales in China.

The current storefront creation and the introduction of Alibaba's new digital payment service, Alipay, is now expected to make it easier for US companies to sell directly to Chinese consumers.