Mars partners with Alibaba to promote e-commerce, safety efforts
- Mars announced a comprehensive partnership with Alibaba Group on Wednesday, the third major food and beverage manufacturer to partner with the world’s largest online and mobile retailer.
- Mars will sell its brands available in China through all Alibaba platforms, including Tmall.com and Rural Taobao. Using Alibaba’s "integrated online and offline business model" will expand Mars' reach to more consumers throughout China, according to a news release.
- Mars, through its Global Food Safety Center in China, and Alibaba will also devise an e-commerce food safety program that aims to enhance safety standards, quality control, and consumer awareness in China.
A difference for Mars' partnership is the food safety component, which could ultimately have a much wider impact on food and beverage e-commerce beyond Mars, Alibaba, and their own customers in China. China has struggled with food safety issues and a handful of recent high-profile scandals. In response, Chinese regulators have said they would campaign to clean up e-commerce and ads in the country after multiple allegations of mislabeling, faux transactions, and poor product quality.
For Mars evolvement on the ground level of improving food safety for e-commerce in China is key to establishing trust and transparency among Chinese consumers. And, Mars could apply any lessons learned in China to e-commerce to other markets, with Mars setting the example for safe food and beverage e-commerce practices.
E-commerce is becoming increasingly important for manufacturers to add to their growth strategies as more consumers embrace the convenience of online shopping. In some countries, this is happening more quickly than in others. In China, 40% of consumers already purchase their groceries online compared to 10% in the U.S.
Food has been slower on the uptake than other categories, such as consumer tech, to adapt to e-commerce. But that also means that manufacturers that enter e-commerce channels sooner than later could have the upper hand.
With chocolate confections three of the company's billion-dollar brands in China, Mars may also work with Alibaba to determine how best to preserve products like chocolate in transport. Chocolate can melt during transportation in the warmer months without specialty packaging or refrigerated truck delivery, which can be particularly costly for smaller e-commerce orders compared to bulk orders for retailers.