Marks & Spencer's online sales in China surge after deal to sell clothes through internet giant Alibaba
Markss & Spencer’s online sales in China have surged after it penned a deal to sell its clothes through internet giant Alibaba.
Shares in the Chinese internet business were on course to become the biggest ever initial public offering in history on Thursday, when $21.8 billion (£13.4 billion) worth were sold in New York. They then soared on their debut on Friday.
Marks & Spencer sells its clothes through Alibaba’s subsidiary, Tmall, and this weekend it said almost half its dress sales in China are online, adding that it was the fastest growing womenswear brand on Tmall.
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Ricky Wilson, the head of Marks & Spencer’s overseas internet business, said: ‘Tmall accounts for 50 per cent of all clothing and footwear purchases made in China, providing international brands with a huge opportunity to reach China’s growing middle classes.’
He said a quarter of its sales on Tmall are from customers in the Greater Shanghai area, which ‘compliments our store presence’.
‘We have adopted a tailored market-by-market approach to international e-commerce and, in a complex market like China, forming a partnership with Tmall has enabled us to benefit from its scale, infrastructure and local insight,’ said Wilson.
The New York stock market launch initially raised $21.8 billion for the company, which was founded by entrepreneur Jack Ma, a former English teacher.
Underwriters for Alibaba are also expected to exercise an option to take an additional 48 million shares, to bring the total value of shares sold to about $25 billion – making it the largest IPO in history.
The shares rose 38 per cent on Friday, valuing the whole company at more than $230 billion (£140 billion).
The listing instantly knocked Amazon, worth $150 billion, off the top spot as the most valuable internet firm in the world.
M&S has 15 shops in China and signed up to Tmall in December 2012. The partnership is an apparent vindication of Marks & Spencer chief executive Marc Bolland’s international strategy, despite struggling to increase sales at home.
Last week Marks & Spencer announced a plan to open in Scandinavia with its first shops in Finland and Norway.
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