Guided by diversification theory, diversification degree,diversification type,diversification opportunity, and product decision-making of diversification are studied based on the 503 cosmetics stores Taobao.com. The study finds that more than 90% online shops with over 5 diamond credibility have implemented a diversification. The level of online retailer’s diversification strategy degree is low, and the diversification is mainly related-diversification. Unrelated diversified product selection is based on customer demands.