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AliExpress introduces tools for sellers outside China

2019-07-09 10:06 Tuesday


China's Alibaba, the leading gatekeeper of B2C sales in China, is now allowing businesses from a select few other countries to sell goods on its AliExpress e-commerce platform for the first time.

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The move is being viewed as a test ground for worldwide expansion, which could see the e-commerce behemoth competing with the likes of Amazon and eBay in many regions across the globe.

For now, AliExpress has opened up its platform to businesses in Italy, Russia, Spain and Turkey.

AliExpress, which solely consists of third-party retailers, is notable for selling items at "bargain basement" prices, such as 99-cent mobile phone cases or counterfeit branded t-shirts for a few US dollars.

Last year, AliExpress registered a 94 percent spike in sales. The English-language platform was originally set up to help Chinese businesses sell their products to international buyers abroad.

"This year is the first year for our 'local to global' strategy," said Trudy Dai, president of AliExpress. "This strategy is intimately connected to Alibaba's broader globalization strategy."

Alibaba's global expansion is a direct aim at Amazon, which is currently the world's biggest online retailer.

But Alibaba's presence in China is practically without challenge, and the country is expected to surpass the US this year as the biggest retail market in the world. Meanwhile, Amazon has struggled to make much of an impact in the Middle Kingdom, where shoppers prefer Alibaba's Taobao and JD.com.

Trudy Dai, president of Alibaba's wholesale marketplaces division, explained: “From the very first day that Alibaba was founded we had a ‘global dream'.” Dai, alongside Jack Ma, Alibaba's founder, was part of the company's first executive team in 1999.

AliExpress plans to roll out the new service in more countries after building up experience in the initial four. Businesses in the four test countries can now register and sell their products to other nations in the AliExpress network.

Although the strategy started only recently, a “good foundation” of small and medium-sized businesses in the four countries have already signed up to sell.

AliExpress is the spearhead for a globalisation strategy supported by Alibaba's subsidiary Lazada, south-east Asia's largest ecommerce platform, and other affiliated companies around the world. Alibaba has also taken equity stakes in Indonesia's Tokopedia and India's Snapdeal.

Some are not seeing the move as quite so positive. The urge to expand overseas, said Billy Leung, a director at brokerage Haitong, is being driven by slowing growth at home.

“We are seeing Alibaba trying to expand globally because they are trying to offset declining growth in China itself,” said Leung. “They are at the point when they need a lot of growth to come from AliExpress and Lazada and other international businesses.”

The local downturn was emphasized last month when Amazon announced it was shuttering its Chinese domestic e-commerce business.

Although Amazon is shutting its store there, Chinese online shoppers will still be able to order goods from Amazon's global store. In fact, this month Amazon added a vast inventory of traditional Chinese language books on its popular reading device, Kindle.

For the first time, this adds thousands of titles which will be available to readers including Chinese expats looking to read classic novels and literature in their original script. Previously, Kindle readers could only read books in simplified Chinese, or had to tackle a tricky conversion process using add-on software.

The expanded book offering will likely attract more users to the platform. Consequently, this will boost Kindle devices' sales as well as download of Kindle app, driving revenues, say analysts.

Adding to the diversification of its strategies, Amazon has also just opened new data centres and infrastructure in Hong Kong to support its expansion of Amazon Web Services (AWS), the largest cloud platform in the world.

Amazon spokesman Jeff Barr, Chief Evangelist for AWS, wrote in an online blog post announcing the plan: "The AWS Asia Pacific (Hong Kong) Region is the eighth active AWS Region in Asia Pacific and mainland China along with Beijing, Mumbai, Ningxia, Seoul, Singapore, Sydney, and Tokyo.

With this launch, AWS now spans sixty-four zones within 21 geographic regions around the world. They also announced plans for 12 more Availability Zones and four more AWS Regions in Bahrain, Cape Town, Jakarta and Milan."

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