Alibaba Opens Gate For More Non-Chinese Sellers On Its Platform

Chinese e-commerce group Alibaba is starting campaigns to realize their “Global Dream”, a wish from the very first founding days. They might want to defeat the biggest rival Amazon, to take the “leader” position in the global e-commerce market.

“Local to Global” Campaign

Since its foundation, AliExpress has been opened for overseas sellers, allowing small and medium-sized businesses to list on the platform. Now, vendors from Russia, Turkey, Italy, and Spain can use the service, which includes registering and selling products to other countries’ purchasers.

The expectation is to make AliExpress present in more countries. According to Alibaba group representative, this year marks the starting of 'local to global' campaign, and AliExpress is considered spearhead for a globalization strategy. Lazada, another Alibaba subsidiary in South-east Asia, will then join the game, together with some affiliated companies.

Why Global When “China is enough”?

Market Share Competition

Alibaba’s biggest rival, Amazon is encountering a tough time in China. Industry competitiveness increases, with the pressure from Alibaba and JD.com, pushing US company to close China store after 15 years. It is considered a step back of Amazon. Nevertheless, the penetration rate is still very low in the developing world, and the global market is promising. The chances are equal.

Starting globalization campaign, Alibaba wants to lay the foundations for growth in expanding markets, building a strong customer base for later competition.

Declining Growth at Home

Not only Amazon, but Alibaba has also experienced a declining growth rate at home. Expanding global businesses can help them to offset the downturn. Mr. Billy Leung, director of brokerage Haitong said that Alibaba was at the point when they needed exponentially higher profit share coming from international subsidiaries. In 2018, AliExpress contributed 94 percent to Alibaba’s revenue of international e-commerce retail business.

Localization Strategies

The company is employing various localization strategies to expand its international footprint. Setting well-connected partnerships with administrators is one of them.

In Russia, the Chinese platform associated with Alisher Usmanov, a Kremlin-friendly oligarch and Moscow’s sovereign wealth fund to build out its business. Mr. Usmanov is widely known to be the investor of Mail.ru, a local internet company with 97 million users in 2018. Also in Turkey, Alibaba invested in clothing company Trendyol, which then opened its online store on AliExpress earlier this year.