Claire Zhang

Easy Money or Thankless Toil? China’s Young E-commerce Entrepreneurs Weigh in on Taobao

(Via Cocokaka)
(Via Cocokaka)

Cocokaka, an online shop, boasts an eclectic collection of accessories that look like they belong on the shelves of an Urban Outfitters store. There is a headless cat backpack, an iPhone case with outstretched fingers, a teapot hat and – one of the most popular items – a giant tiger-head backpack, which has inspired many imitators in other stores on Taobao, the Chinese e-commerce site that is best described as an eBay on steroids.

The store is owned by Luojun Xu, a 19-year-old student at the Shanghai Academy for Visual Arts. She plans to study jewelry design at the Birmingham Institute of Art and Design in England next year, and is just one of many in a recent trend of young Chinese entrepreneurs who have opened their own Taobao stores.

While many young Taobao storeowners resell clothing and other products purchased wholesale near their homes, like Xu’s classmate Poppy, Xu decided last summer to use her artistic skills to craft quirky accessories to sell. She was inspired to do so after coming across a giant plush tiger hanging on a wall in a toy store.

This tiger-head backpack has become one of Cocokaka's most popular items (via Cocokaka)
This tiger-head backpack has become one of Cocokaka’s most popular items (via Cocokaka)

“The tiger happened to be hollow in the middle; the front was 3-D, made out of foam; and the back was a flat piece of cloth. I realized I could put things in the hollow middle and put a zipper in the cloth backing to make a backpack,” said Xu in an email interview.

Now Xu continues to use her skills to transform other cheap, plain, wholesale accessories into original products for her store. “At first, I wanted to use Taobao as a platform for my designs,” Xu said. She typically releases a newly designed product about once a month, depending on the amount of old design orders she must fill first and the materials on hand.

The design ideas come to her through many avenues. Sometimes she gets a burst of inspiration from something she sees randomly, such as the tiger backpack, and other times she’ll try to think up a design by looking at raw materials. Afterwards, she goes to purchase the materials needed and begins to craft. At times, she runs into a roadblock and must devise a new design and purchase new materials.

“You need to be observant, and you also need time to think and develop,” she said.

Xu has now made about RMB60,000 (approximately US$9,800) in a year, roughly equivalent to the salary of a decently-paid college graduate in Shanghai, and has attracted over 400,000 visitors to her store, turning a design showcasing opportunity into a lucrative one as well. The prospect of making money was indeed one of her biggest motivations for opening the store.

“If you want to use Taobao to make a couple thousand yuan each month, you can really do it. I feel that it’s especially suitable for university students, because university students have a lot of free time, and a lot of people waste time on trivial things every day, just letting every day pass by,” one Weibo user, @sam19870606, wrote on his blog.

Taobao’s low barriers to entry give many people an opportunity to open a store and generate income independently from the comfort of their homes, an appealing option given China’s terrible job market. “If today’s young people either want to earn extra money or don’t have jobs, their first thought is to open a Taobao store,” wrote @子轩19866, commenting on the retirement of Alibaba CEO Jack Ma in May. “Taobao’s success is in responding to this demand, keeping up with the people’s increasingly difficult lives.”

While it only takes minutes to sign up to open a Taobao store, competition is cut-throat – with 800 million product listings as of June 2012, according to the Alibaba Group. “Why do today’s young people like opening Taobao stores so much? In my opinion, opening a Taobao store is worthless. The competition is so great now. Let me ask, out of 10 store owners, how many become successful? The answer is none!” wrote @知道不HLGC.

“Almost all shoppers obsessed with Internet shopping have tried to open a Taobao store, but most of them simply dabble in it for a little while and then stop. There are idle office workers who casually open a Taobao store, play around with it while it’s new, and then cast it aside. Young people who want to make a little extra income outside of work will also open a store, but the majority also give up halfway,” wrote another user, @51paris名品专区. “Taobao’s soil gets richer and richer because of you, the soil soaked with your beautiful dreams and youthful sweat. With so many hot-blooded buyers and sellers, Taobao will last forever!”

Yet, Taobao has indeed been a good source of income for many who have succeeded, such as Xu, and other users who shared their experiences on Weibo, China’s Twitter. Weibo user @桃总芝麻 wrote that her sister’s Taobao clothing store earns over 10,000 RMB per month and commented that it would likely be more worth her time to help her sister manage customer service and product packaging than to write 1,000 reports for her job.

What makes a Taobao store successful?

“Good products, good packaging, a good storefront, good customer service, and timeliness. You also need a little bit of promotion and marketing,” said Xu. She also doesn’t pay much attention to the competition. “You just have to be continuously increasing your own competitiveness by developing more and better products.”

A popular answer to the question “What kind of skills do you need to open and run a Taobao store?” with 585 votes on Zhihu (a Chinese version of Quora) that was shared 565 times on Sina Weibo also outlined a number of factors necessary for Taobao success, the first being familiarity and acumen with the target market. A decent, high-quality camera (the respondent noted that a point-and-shoot approach would not cut it) was next, in addition to photography and picture-editing skill to increase visual appeal. Following that, copywriting skills for the product description. The most crucial part of running a Taobao store, and where most sellers failed, wrote the user, was marketing and promotion.

Packaging, shipping and after-sales service also matter for sellers who care deeply about building and protecting their Taobao reputation rating, which is critical for business. Xu said that one of her least favorite aspects of running a Taobao store is in fact having to deal with deliberately difficult customers. It is for this reason that psychological fortitude is also required.

With all the work involved, the enterprise can become exhausting – nights spent at home in front of the computer answering customers’ questions and concerns before and after sales, and days filled with purchasing materials, crafting, photographing, and packaging products.

“Since running a Taobao store takes up so much time, I’ve missed a lot of opportunities to go out and have fun,” said Xu.

Last year, a 24-year-old Taobao seller of clothing named Ai Jun died from cardiac arrest, attributed to fatigue and overwork. There have been a handful of other young Taobao seller deaths related to fatigue reported as well. On Weibo, many users post about Taobao labor and toil.

“Running a Taobao store is truly not easy nowadays. You work from dawn to the whispers of dusk; the buyers are becoming more and more picky; you face many risks just to sell some items for a couple of yuan. If a customer is unhappy, they have a lot of ways to make your life miserable. There have been so many disrespectful people lately, or maybe it’s my bad luck; every day I come across a demanding customer,” wrote Weibo @帽行天下.

“Photographing clothes is like going into battle. Have to worry about the photographer, the amateur model, the assistant, and the location… crazy! I’m exhausted! I really believe that every kid who opens a Taobao store is a fallen angel! How do you all face this intense work every day, and on top of that, 24-hour customer harassment? I salute you!” wrote Weibo user @杨梦涵_悶悶.

But of course, making a living is never easy – unless you are a fu’erdai [rich second-generation], perhaps –especially in a society as competitive as China’s. Taobao provides an accessible avenue for young people without many other options to support themselves. As @sam19870606 reminds them:

“Doing anything requires careful consideration. You will always have to invest your own hard work and sweat. There is nothing on Earth you can reap the benefits of without sowing.”

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Claire Zhang

Claire Zhang is a Chinese-American English major at Yale University, where she writes for a number of publications.