In a bid to expand its product range and appeal, online fast-fashion retailer Shein is actively courting brands like toothpaste conglomerate Colgate-Palmolive and toymaker Hasbro, aiming to sell more household names on its platform.
Renowned for its affordable in-house clothing and accessories, Shein is diversifying into additional categories, extending access to its platform to brands and retailers across nine European countries. This expansion follows its successful ventures into the United States, Brazil, and Mexico last year.
As part of Shein’s overarching strategy to enhance credibility and bolster competition against Amazon, this initiative facilitates the business’s expansion and innovation in sales methods, laying the groundwork for its anticipated stock market listing later this year.
Last month in Madrid, Shein showcased its marketplace services in conjunction with prominent brands such as Colgate-Palmolive, Hasbro, Suntory Beverage & Food (the maker of Orangina), and Spanish cosmetics brand Bella Aurora.
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At a conference in Paris on April 17th, Christina Fontana, Senior Director of Brand Operations for Europe, Middle East, and Africa at Shein, emphasized, “While Shein is widely recognized for fashion, we’re actively involved in all verticals.”
Fontana stated that witnessing shoppers opening Shein and exploring other brands served as the driving force behind this initiative.
“Our consumers desire brands, if that’s what they are searching for, that’s what we are going to give them.”
Fontana, formerly with Alibaba, is among a group of marketplace specialists that Shein has recruited from prominent companies, including the Chinese e-commerce giant and others.
This recruitment drive has contributed significantly to rapid expansion. Shein garnered an average of 108 million monthly active users across European Union member states in the six months leading up to January 31st.
However, the company’s expansion has introduced new challenges, such as adhering to new EU regulations mandating the monitoring of its platform for illegal or harmful products.
In Europe, Shein’s marketplace is currently accessible in the following countries: Britain, France, Germany, Italy, the Netherlands, Poland, Portugal, Spain, and Sweden.
According to experts, the success of Shein’s new marketplaces and its ability to rival Amazon and AliExpress will hinge on the brands it manages to attract.
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Xiaofeng Wang, an e-commerce analyst at Forrester in Singapore, emphasized, “For Shein to establish itself as a reliable and respected marketplace platform, securing endorsements from prominent Western brands is crucial.”
During a Zoom webinar tailored for potential sellers in the United States, Claire Lin, Shein’s Head of Seller Marketing, presented an enticing opportunity for brands to tap into millions of shoppers and “supercharge” their sales.
“Our shopping experience is highly engaging; it’s like playing some sort of game,” she explained. “Browsing our site is enjoyable, which is reflected in our minimum shopping time of around eight minutes, surpassing the industry average.”
According to Lin, Shein’s shoppers primarily consist of Gen Z and millennials, with a notable majority being female, accounting for approximately an 80-20 split between women and men.
She mentioned that home, electronics, beauty, and health are currently the top-performing categories. Interestingly, the only category Shein doesn’t offer is food and beverages.
As per a slide displayed during the webinar, the gross merchandise value (total value of products sold) in the home category saw a threefold increase in 2023. Likewise, electronics experienced a 2.5-fold growth, and beauty & health products surged by 2.1 times.
Before opting to sell directly through a marketplace, brands often seek assurances that the platform aligns with their target audience and that they’ll maintain control over pricing and promotions. This ensures they can maximize their sales potential through the platform.
Many third-party retailers have been drawn to Shein’s platforms.
Currently, third-party shops in the United States, Britain, Brazil, and Mexico are selling products on Shein’s platform; these merchants include Caudalie, CeraVe, Shiseido, The Ordinary, and Weleda.
Jayn Sterland, the UK & Ireland country manager at Weleda, stated that the Swiss cosmetics brand had no plans to sell directly on Shein.
Sterland added that when evaluating a marketplace, factors such as reputation, perception, and environmental impact are crucial considerations for the brand. She pointed out sustainability initiatives that Weleda collaborates on with Amazon, where it directly sells its products.
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There was no response from Colgate-Palmolive to a request for comment. A spokesperson from Hasbro mentioned that the company took part in the Madrid event to discuss the advantages and disadvantages of marketplaces in general.
According to a spokesperson from Suntory, the company does not currently sell any of its beverages on Shein’s marketplace, nor do they have any plans to do so. Their participation in the event was solely an opportunity to exchange best practices.