Chinese Short Video and Livestreaming Platform Douyin Looks to Challenge Alibaba

Starting on September 4, the Chinese division of Japanese fast fashion brand Uniqlo commenced e-commerce livestreaming sessions on Douyin, TikTok’s counterpart for mainland China owned by parent company ByteDance. Analysts believe that shoes and clothing are the most important category for Taobao, the traditional leader of Chinese e-commerce livestreaming, owned by domestic tech giant Alibaba. They also contend that Douyin’s continuous introduction of leading fashion brands to its platform means that Taobao and Douyin are entering into more direct competition.

Uniqlo presently has three official accounts certified on Douyin. Apart from the account mainly responsible for livestreaming, the other two are “UNIQLO” and “Uniqlo’s Top-Selling Items Fitting Room” that publish fashion recommendation posts, basically forming a matrix that integrates outfit recommendations and live commerce.

In fact, Uniqlo opened an official account on Douyin as early as 2018, but it has just recently started livestreaming, after it opened an official online flagship store a few days ago. The market considers that it may have been affected by the decline in performance. In the first quarter of this year, Uniqlo China experienced a decline in both revenue and profit for the first time, and in the second quarter, the firm set a record by closing 169 physical stores in the Chinese market.

However, for Douyin, cooperation with Uniqlo is a key step in enriching its clothing category, which can attract other leading fashion brands. In the clothing and shoes category, Douyin introduced Adidas, which has also encountered a declining performance in China. In the first half of this year, it conducted its first exclusive livestream on Douyin, during which Adidas’s sales exceeded 170 million yuan ($24.2 million).

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On the other hand, Uniqlo serves as a weather vane for the competitiveness and strength of China’s e-commerce platforms. Previously, in order to expand the category image of JD.com for users, the e-commerce platform cooperated with Uniqlo and provided it with a series of exclusive preferential agreements. Although Uniqlo finally closed its flagship store on JD.com, it was enough to show the attraction of this brand to Chinese e-commerce platforms.

According to LatePost Finance, as of 2021, Douyin E-Commerce’s paid gross merchandise value (GMV) had exceeded 700 billion yuan. According to official data, as of the end of April this year, its GMV in the past year was 3.2 times that of the same period. Douyin is now the fastest growing e-commerce platform in China.

On the other hand, Taobao, which has lost leading streamers such as Austin (Jiaqi) Li and Viya in the past year, has faced the attack of competitors such as Douyin and Kuaishou. It seems to have fallen into the biggest crisis since its establishment. This year, it became the only e-commerce livestreaming platform that did not publish a 618 Shopping Festival Performance Report.