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  • EU Slaps AliExpress with Record $629 Million Fine Over Counterfeit Goods Crackdown Failure

    EU Slaps AliExpress with Record $629 Million Fine Over Counterfeit Goods Crackdown Failure

    On Monday, AliExpress, Alibaba’s subsidiary, was slapped with a record-breaking €550 million (US$629 million) fine by the European Union for its failure to address sales of illegal, dangerous and counterfeit items on its platform. This penalty is considered to be the largest to date, issued by the European Commission in line with the EU’s Digital Services Act, a prominent law that mandates online platforms of substantial size to augment their efforts in combating harmful and illicit content.

    This penalty is the third of its kind issued by the European Commission, following charges placed on AliExpress in June of the previous year for non-compliance with a Digital Services Act stipulation. This regulation requires platforms to evaluate and reduce the risk of distributing illegal products. AliExpress was given until October 20 to suggest corrective actions. Should the regulatory body determine in December that the company has failed to meet the requirements of the Digital Services Act, further sanctions may be levied.

    The EU’s tech chief, Henna Virkkunen, expressed concern over this issue, describing it as highly risky for consumers and unfair to companies that abide by the rules. She highlighted the vast user base of AliExpress in Europe, standing at 193 million last year, compared to Shein’s 156 million and Temu’s 130 million. Temu has also been subject to fines under the Digital Services Act, and Shein is currently under investigation.

    AliExpress has voiced its intention to contest the fine, deeming it as excessive. “Today’s decision and disproportionate fine disregards our robust risk management structure and the substantial, proactive improvements we’ve implemented,” AliExpress stated via email. The company also indicated its active collaboration with the Commission to satisfy its evolving expectations.

    Assessment and Criticism of AliExpress’s Risk Management Practices

    The Commission criticized AliExpress for not adequately assessing whether it had sufficient personnel to manage risks and for overestimating the efficacy of its system in identifying and removing illicit products. Furthermore, the Commission took issue with the company’s ineffective penalty policy, which allowed penalized businesses to continue selling illegal products on its platform.

    The regulator also noted that AliExpress’s “brand authorisation” system, designed to deter counterfeit sales, was insufficient and easily bypassed by traders selling fraudulent items. There was also criticism of the company’s advertising and recommender systems for contributing to the spread of illicit products and relying on one quantitative indicator to assess the moderation system’s effectiveness in preventing the appearance or re-emergence of illegal products in similar forms.

    However, the regulator did consider the novelty of the Digital Services Act as a mitigating factor when determining the fine, which could have been even larger. This penalty far surpasses the €120 million fine imposed on Elon Musk’s social media platform X and the €200 million fine on Temu, both for Digital Services Act violations.

    Questions & Answers

    What is the significance of the fine imposed on AliExpress by the European Union?

    This penalty, amounting to €550 million (US$629 million), is a record-breaking fine issued by the European Commission under the EU’s Digital Services Act. It highlights the EU’s stance on ensuring large online platforms take more responsibility in preventing the distribution of illegal and harmful content.

    How has AliExpress responded to the fine?

    AliExpress has expressed its intention to appeal the fine, deeming it as excessive. The company asserts that this penalty neglects the robust risk management framework they have established and the proactive enhancements they’ve implemented in their operations.

    What criticisms has the European Commission voiced regarding AliExpress’s operations?

    The Commission has criticized AliExpress for inadequately assessing risks and overestimating its system’s effectiveness in identifying and removing illicit products. Other criticisms include the company’s ineffective penalty policy, its “brand authorisation” system’s shortcomings, and its advertising and recommender systems’ role in spreading illegal products.

  • AliExpress Takes Steps to Align with EU Regulations amidst Scrutiny over Sale of Unsafe and Counterfeit Products

    AliExpress Takes Steps to Align with EU Regulations amidst Scrutiny over Sale of Unsafe and Counterfeit Products

    In response to heightened scrutiny by the European Union (EU), Chinese e-commerce platform AliExpress has announced enhanced measures to ensure compliance with the bloc’s regulations. This move comes as the EU intensifies its focus on rapidly expanding online platforms like AliExpress, Temu, and Shein, all of which offer inexpensive products manufactured in China to the EU market duty-free. This is due to a waiver on low-value e-commerce packages, a privilege now under review.

    Scrutiny and Investigations

    AliExpress, which operates under the umbrella of Alibaba and sells products in over 200 countries, has been under the EU Commission’s microscope since March 2024. The company acquiesced to legally binding commitments in June the same year, promising to strengthen its regulatory oversight.

    However, a high-profile incident in November, in which AliExpress was found to be selling inappropriate dolls, led to the platform banning the China-based seller responsible for the products.

    Eric Pelletier, Alibaba’s head of international government affairs, assured European lawmakers that AliExpress is taking significant steps to ensure compliance with the bloc’s regulations. He announced plans to decrease the visibility of adult products by default, and acknowledged that further work was needed in several areas. These include preventing the relisting of illegal products, strengthening penalties, and expediting the removal of non-compliant sellers.

    Responses and Future Plans

    Christel Schaldemose, an EU lawmaker and lead rapporteur on the Digital Services Act, expressed skepticism about the effectiveness of AliExpress’s systems. Schaldemose underscored safety as her main concern, but also highlighted the issue of unfair competition faced by companies adhering to EU regulations.

    The number of low-value e-commerce packages entering the EU saw a 26% increase last year, reaching 5.8 billion. In an attempt to level the playing field with domestic retailers, the bloc plans to introduce fees on these shipments.

    Questions & Answers

    What measures is AliExpress taking to strengthen its regulatory compliance in the EU?
    AliExpress has committed to enhancing its controls, including decreasing the visibility of adult products by default, preventing the relisting of illegal items, strengthening penalties, and expediting the removal of non-compliant sellers.

    Why is the EU increasing its scrutiny of online platforms like AliExpress?
    The EU is concerned about safety issues, the sale of counterfeit items, and unfair competition towards companies that comply with the bloc’s rules.

    What is the EU’s plan regarding low-value e-commerce packages?
    The EU plans to introduce fees on these shipments to promote fair competition with domestic retailers.

  • AliExpress and Specialized Score a Win: Uncover $1.1M Fake Bike Parts Operation in Major Anti-Counterfeit Sweep

    AliExpress and Specialized Score a Win: Uncover $1.1M Fake Bike Parts Operation in Major Anti-Counterfeit Sweep

    AliExpress, the popular Chinese online retail platform, recently played a pivotal role in a successful crackdown on counterfeit bike products. Collaborating with Chinese law enforcement officers, the joint operation resulted in the seizure of fraudulent bicycle products worth over $1.1 million.

    The Operation

    The campaign, which was conducted in March, led to the arrest and prosecution of seven individuals. Confiscated items included counterfeit Specialized Tarmac SL8 road-racing frames, Roval handlebars and wheels, and a variety of other bicycle parts such as seatposts, forks, and around 9500 sticker sets.

    In addition, the operation resulted in the seizure of fraudulent items from other well-known bicycle manufacturers including Pinarello, Cannondale, Cervelo, and Trek. According to AliExpress, the estimated black-market value of all seized counterfeit carbon-fibre bicycle goods surpasses $1.6 million.

    Protecting Consumers and Brands

    Matthew Bassiur, the head of Alibaba International’s global intellectual property (IP) enforcement team, underscored the importance of the operation. He stated, “Safeguarding consumers and upholding brand trust are core to our platform’s integrity.” He stressed that although they promptly remove any infringing listings from their marketplace, achieving lasting impact requires the dismantling of physical operations. This necessitates close collaboration with brands and law enforcement, an approach well demonstrated by this case.

    This operation represents the largest anti-counterfeiting action in the history of Specialized. Andrew Love, the global brand protection manager at Specialized, praised the initiative, noting that these illegal operations not only exploit consumers but also undermine trust in authentic products. He commended Alibaba and Chinese law enforcement for their crucial roles in this significant achievement.

    The Investigation

    The investigation was initiated when Specialized approached AliExpress with concerns about suspected counterfeiters using the e-commerce platform to trade illegal and unsafe bicycle products. Specialized conducted test purchases to verify that the goods in question were indeed counterfeit. Over the past year, AliExpress has cooperated with more than 20 global brands, resulting in the seizure of over $30 million worth of counterfeit goods.

    Questions & Answers

    What was the estimated value of the counterfeit goods seized in the operation?
    The estimated black-market value of the counterfeit bike products confiscated surpassed $1.6 million.

    Who were some of the manufacturers whose counterfeit goods were seized?
    Counterfeit goods from manufacturers including Specialized, Pinarello, Cannondale, Cervelo, and Trek were among those seized.

    What initiated the investigation?
    The investigation began when Specialized provided AliExpress with information on suspected counterfeiters using the e-commerce platform to sell fraudulent and unsafe bicycle products.

  • AliExpress Joins Forces with Homart to Boost Wellness Category with Quality Australian Products

    AliExpress Joins Forces with Homart to Boost Wellness Category with Quality Australian Products

    AliExpress, a renowned e-commerce platform, recently announced a strategic alliance with Homart Group, a prominent Australian health and wellness manufacturer. This collaboration seeks to enhance AliExpress’s local product offerings through the inclusion of Homart Group’s products.

    Strengthening Local Product Offerings

    As part of the agreement, AliExpress will assist Homart in establishing and promoting its primary store on the platform. The store’s initial launch will feature approximately 40 products from four distinct brands, namely, Top Life, Spring Leaf, Grandpawpaw, and Cheri. The plan is to broaden this to encompass around 200 products over the course of the next three years.

    The product offering will span across different categories, including vitamins, skincare, and wellness products.

    Lynn Yeh, CEO of the Homart Group, expressed excitement about the partnership with AliExpress. She underscored the importance of showcasing the merits of Australian-made products, which are known for their quality, reliability, and innovation, to both local and international consumers.

    Health and Wellness Category

    AliExpress has a dedicated health and wellness category designed to provide Australian consumers with access to regulated supplements and lifestyle products. The collaboration with Homart is in alignment with AliExpress’s larger agenda of investing in Australian businesses.

    The partnership is projected to create numerous opportunities for local brands and distributors to gain international exposure and marketing support via AliExpress’s campaigns. These campaigns include initiatives like 6.18, Double 11, and Black Friday.

    Alfy Zhang, the country manager for AliExpress ANZ, stated that the partnership with Homart is a significant progression in AliExpress’s effort to bring more reliable, Australian-made health and lifestyle products to local consumers. He further added that the blend of AliExpress’s international reach and digital prowess with Homart’s solid product reputation would facilitate the growth of local brands. At the same time, it would provide Australians with access to credible, high-quality products that cater to their daily needs.

    The agreement was officially ratified last week at the China International Import Expo in Shanghai. This was followed by a ribbon-cutting ceremony at Homart’s booth.

    Questions & Answers

    What is the aim of the strategic collaboration between AliExpress and Homart Group?
    The primary goal of the partnership is to broaden AliExpress’s local product offerings by including Homart Group’s health and wellness products.

    What will the product range offered by Homart on AliExpress encompass?
    The product range will initially contain around 40 items from four brands, spanning categories such as vitamins, skincare, and wellness. The plan is to expand this selection to around 200 products within the next three years.

    What are the potential benefits of this agreement for local Australian brands and distributors?
    The partnership is anticipated to provide local brands and distributors with opportunities for global exposure and marketing support through campaigns by AliExpress.

  • AliExpress Shuts Down Controversial Doll Vendor Amid Legal Scrutiny: A Deep Dive into the Intricate Web of Online Marketplace Regulations

    AliExpress Shuts Down Controversial Doll Vendor Amid Legal Scrutiny: A Deep Dive into the Intricate Web of Online Marketplace Regulations

    AliExpress, the online marketplace under the Alibaba Group, has expelled a China-based merchant who was selling dolls with childlike features intended for sexual use. This move followed a Reuters inquiry into whether the sale of these products adhered to the laws of the United States and European Union.

    The Case at Hand

    AliExpress was first alerted to these controversial listings in mid-November. The company initially claimed that there was no violation of their policies, arguing that the dolls were rigid and lacked any sexual functionality. However, they later shifted their stance, banning the seller for dishonest conduct on this grave issue.

    The seller, Guava Dolls, was found to be marketing four dolls that bore a striking resemblance to minors. These dolls were available for purchase in the US and Europe. Lawyers examining the case pointed out that the images of the dolls on AliExpress bore hallmarks of child sexualization, such as infantile expressions and school uniforms.

    Despite several attempts to reach Guava Dolls through email and social media, the seller remained unresponsive. AliExpress stated that the seller repeatedly denied selling sex toys on any platform, but eventually admitted to accepting custom orders on different platforms. This admission led to their permanent ban from the marketplace.

    European Regulations and the DSA

    AliExpress, along with Shein and Temu, falls under the purview of Europe’s Digital Services Act (DSA) due to their classification as Very Large Online Platforms (VLOPs). The European Commission is closely supervising AliExpress’s compliance with the DSA.

    The DSA mandates that online consumer marketplaces carry out due diligence on the products being sold on their platforms. They must also block or remove any illegal content once they become aware of its presence. These platforms now face stiffer regulatory obligations.

    AliExpress has indicated that it plans to employ third parties to aid in monitoring its platform in the future.

    Response to the Investigation

    The investigation was instigated by a consumer watchdog that spotted the childlike sex dolls on Shein’s marketplace. The European Commission has since asked Shein to provide information on their protective measures against age-inappropriate content and illegal products.

    AliExpress announced after the investigation that it had removed similar listings. It further stated that sellers who violated its policies would face penalties.

    According to the rules of AliExpress, content must neither be sexually explicit nor harmful to minors. Listings that insinuate or depict sex involving minors are prohibited. The company had originally claimed that the dolls in question were anime dolls created for fans of Japanese animation.

    Legal Implications

    In certain European countries, including France, Germany, and the UK, selling or facilitating access to dolls suggestive of children is illegal, regardless of their function. Consumer protection bodies in these nations often categorize such items as analogous to images of sexual abuse under child protection laws. Lawyers consulted by Reuters argued that the listings on AliExpress violated both national and EU guidelines.

    European Union lawmakers voted in favor of a resolution to protect EU consumers from non-compliant e-commerce platforms. This resolution underscores the issue of childlike sex dolls, among others. It is anticipated that the resolution will implore the Commission and EU member states to intensify checks on products entering the bloc.

    In the US, the regulation of childlike sex dolls is determined by state laws. Several states, including Arizona, Utah, Kentucky, Florida, Tennessee, Texas, Hawaii, Louisiana, and Wisconsin have enacted legislation targeting the sale, import, or possession of such dolls.

    Questions & Answers

    What triggered the investigation into AliExpress and Shein?
    The investigation was triggered by a consumer watchdog that discovered childlike sex dolls on Shein’s marketplace.

    What are the obligations of online marketplaces under Europe’s Digital Services Act (DSA)?
    The DSA mandates that online consumer marketplaces carry out due diligence on the products being sold on their platforms. They must also block or remove any illegal content once they become aware of its presence.

    What actions have been taken by AliExpress in response to the investigation?
    AliExpress has removed similar listings from its platform and announced that sellers who violated its policies would face penalties.

  • AliExpress Unveils New Winter Sports Gear Trends

    AliExpress Unveils New Winter Sports Gear Trends

    The global winter sports gear market continues to boom in 2022 thanks to the thrilling Beijing 2022 Winter Olympics and the rising popularity of winter sports around the world. Sales data from AliExpress, a global retail online marketplace under the Alibaba Group, shows a growing demand for winter sports products particularly for the winter sports equipment and gear categories.

    Strong Demand for Fashionable and Tech Infused Winter Sports Products

    According to sales data, 2022 is set to be a milestone for the winter sports gear market. AliExpress recorded a 60% increase in sales of winter sports gear in Q4 2021 year-over-year, with a growing number of customers looking for trendier and more fashionable ski outfits, goggles and helmets.

    Ski products with tech features such as heated ski gloves have been catching AliExpress customer interest since they create a more enjoyable experience for winter sports lovers. The sales of heated ski gloves on AliExpress in Q4 2021 increased by 780 times year-over-year.

    Best-selling winter sports gear on AliExpress include ski helmets, snowboard sets, ski pants, ski gloves and ski goggles. In particular, the sales of ski helmets on AliExpress in Q4 2021 saw a 1500% increase year-over-year.

    Russia, US, South Korea, France, and Spain Markets Lead Winter Sports Gear Sales 

    The top five markets purchasing winter sports gear on AliExpress include Russia, US, South Korea, France and Spain. In addition, with AliExpress operating in over 200 countries and regions around the globe, customers in Iceland, Chile and other remote areas are able to get their winter sports gear on AliExpress thanks to its well-established logistics ecosystem.

    Cost-performance of ski equipment has particularly been advantageous for French and Spanish customers. In particular, the sales volume of ski goggles and ski gloves in Spain increased 100% and 53% year-over-year respectively. In France, customers are opting for a two-layer ski jacket, resulting in a 72% growth year-over-year for this item.

    In Asia, an increasing number of South Korea customers are purchasing ski gloves and two-layer ski jackets on AliExpress for their ski adventures.

    Elevated E-commerce Experience with Upgraded Logistics Infrastructure

    AliExpress is committed to providing a faster and more efficient cross-border delivery experience with its robust cross-border e-commerce ecosystem consisting of seven domestic selection warehouses in China, nine automated sorting centers in China, overseas warehouses and a weekly average of over 80 chartered flights.

    In partnership with Cainiao, AliExpress currently offers delivery in 10 working days for selected cross-border orders made in Spain and France, 12 working days for Brazil and five working days for South Korea.

    Since 2020, AliExpress and Cainiao have also actively developed overseas warehouses to enhance the capacity and efficiency of cross-border logistics networks. Local shipping in Spain and France can be delivered in three days and seven days for the rest of Europe.

    A network of over 20,000 self-pickup service points has been launched in Spain, France, Poland and Russia, combining AliExpress-branded lockers powered and operated by Cainiao, as well as collection points powered by local partners.

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  • How shoppertainment powers the growth of AliExpress

    How shoppertainment powers the growth of AliExpress

    AliExpress is Alibaba’s cross-border e-commerce platform, which facilitates trade and brings sellers and buyers together. AliExpress does not sell directly, but provides a platform for safe transactions between sellers and buyers. AliExpress was founded in 2010, and is today one of the top cross-border B2C platforms.

    AliExpress is available in more than 200 countries and regions, and recently they launched their selling program to include overseas sellers, limited to some countries. AliExpress was previously only open for Chinese sellers accessing international consumers. Now, they are exploring a change to their business model by opening its marketplace to non-Chinese sellers, which means they will be better positioned to compete against Amazon. About a year ago, AliExpress introduced the platform to international sellers from Italy, Spain, Russia and Turkey.

    To learn more about AliExpress business model and growth plans, I have interviewed Martin Wang, the director of Social Commerce & Innovation Partnership at AliExpress:

    To start off, I would like to introduce my readers to what AliExpress is and what is your future goal and mission?

    • Launched in 2010 by Alibaba Group, AliExpress is a global online retail marketplace that enables consumers around the world to buy directly from manufacturers and distributors from China and other markets. AliExpress is an important part of Alibaba Group’s globalization strategy.
    • Alibaba’s mission is to make it easy to do business anywhere. AliExpress not just serves consumers from all over the world, but also enables small and medium-sized businesses to grow locally and globally. In early 2019, AliExpress opened up its platform for merchants in several pilot markets outside of China, including Russia, Spain, Italy and Turkey. AliExpress’ vision is to leverage its commerce and lifestyle platform to enable consumers and merchants around the world.
    • Leveraging Alibaba Group’s  technology and expertise in commerce, AliExpress has built an infrastructure to provide the best experience for consumers and sellers, including three key components – a well-established platform, localized payment options and an efficient logistic network through local partnerships.
    • Currently, AliExpress operates in 18 local languages and serves more than 200 countries and regions, with strong market presence in Russia, the United States, Spain, France, Brazil, Poland, the UK, the Netherlands, Israel and Korea.

    AliExpress is currently exploring a new business model of welcoming overseas sellers onto the platform, called the overseas seller program. This means overseas sellers can leverage AliExpress as a platform to sell their products. This service is currently limited to Spain, Italy, Russia and Turkey. Any plans in the near future to expand this service to other countries? What are AliExpress global expansion plans?

    • AliExpress’s goal is not just serves consumers from all over the world, but also enables small and medium-sized businesses to grow locally and globally. We started the overseas seller program about 1 year ago, since then, we have seen a huge number of local sellers from the mentioned countries joining the platform, which gave us more confidence on continuing this direction. However, such launching involves a quite heavy investment especially in the beginning like infrastructure, language localization, regulation etc., that’s why we are doing this step by step and will expand when time is ready .

    Amazon recently announced its entrance to the Swedish market. As I live in Norway, I am interested to hear your take on AliExpress positioning in Europe.

    • Europe as a whole is a strategically important market for AliExpress, where we have established strong presence in certain countries, such as Spain, France and Poland. We will continue investing in upgrading infrastructure and user experiences and bringing more quality products and services to consumers there.

    Livestreaming in China has been growing every year, and is now estimated to account for about 9 percent of total e-commerce sales in China. Brands use livestreaming, broadcasting in real-time, as a ‘tool’ to promote products and engage with their potential customers. In Europe, this trend is also gaining traction. Does AliExpress offer merchants this tool in order to reach a bigger audience? If yes, do you have an example of a merchant using livestreaming to succeed on the platform?

    • AliExpress have been offering the livestreaming service for already more than 1 year, and the penetration keeps increasing. We have quite some merchants who have enjoyed a better result via livestreaming, for example, we do have a mobile brand, they held a livestreaming in different languages on AliExpress, and broke the sales record which is more than 400% higher than ever.

    China is the leading nation when it comes to the development of retail and e-commerce. Social Commerce is a pre-existing trend in China, the integration between social networks and commerce. This trend has been amplified during the pandemics. What are your thoughts on the development of social commerce and how are social elements integrated on AliExpress?

    • We believe social commerce is a new trend as consumers are increasingly looking for more from their shopping experience, to interact with brands in new, engaging ways. We’ve seen the tremendous growth in livestreaming sales in China, which have played an important role in driving retail transformation and e-commerce success, and have become a great source of job creation and income especially during the Covid-19 pandemics.  Taking the experiences from China and Alibaba Group, AliExpress has been working with local influencer agencies in Europe, to nurture influencer talent and create a new business approach. We also launched a brand new platform called AliExpress Connect, which is designed to create opportunity for both brands and influencers, as the world moves increasingly toward online shopping. It offers new income sources and job opportunities for influencers and content creators, helping them to scale and digitalize their business. While for brands, it opens up the opportunity to attract new customers.

    Facebook and Instagram are two popular social networks in Europe. Is AliExpress closely linked with these networks?

    • These are two of the most popular social channels where aliexpress is doing different campaigns.

    In China, Key Opinion Leaders (KOLs) and Key Opinion Consumers (KOCs) are essential in marketing to reach more consumers. In the West, we are more used to hear influencers. How is AliExpress looking to use influencers in the West?

    • We do have the AE Connect platform for influencers, both Aliexpress and our sellers will post different tasks such as content creation, livestreaming, brand awareness, new user acquisition etc., and influencers will get paid based on the performance.
    • If anyone is interested in joining the program, you could email to the following: aesocial@aliexpress.com or go directly to: https://connect.aliexpress.com/ to check our tasks and terms right away.

    To sum up, AliExpress, among other digital marketplaces, are gaining presence in Europe and around the world. AliExpress is not just a marketplace that connects sellers and buyers, but a lifestyle app that creates unique user experiences.

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  • AliExpress launches free-returns program in 8 markets

    AliExpress launches free-returns program in 8 markets

    Alibaba Group’s global online marketplace AliExpress is to offer free return and refund for participating categories across eight countries.

    Buyers in main areas of eight pilot countries including Russia, France, Germany, Spain, the UK, the US, Canada, and Australia will be first to participate in the new program.

    Products participating in the new program range from consumer electronics, jewelry, shoes to cosmetics products. Under the new policy, customers in the eight countries with an eligible address will see a “free return” sign on the webpage of the eligible products. Customers can request a free return and refund for those products within 15 days of receiving their order.

    According to the return and refund policy, products must be returned in new and unused condition. In addition to products such as mobile phones, underwear, food categories, and customized products, products priced over US$1000 are excluded from the program.

    Customers can go to local post offices to return unwanted products and expect to receive their refund in as little as three days. The processing time varies depending on the payment solution they used to buy the product.

    Cheer Zhang, the head of Global consumer and market operation at AliExpress, says the objective of the new policy is to improve the shopping experience and give consumers more confidence to explore the platform’s wide range of brands and products.

    The new “free return” program is an upgrade from a previously launched “local return” program that had been operating in seven countries. Under the previous plan, customers had to cover the delivery fee for the return orders.

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  • Alibaba targets 30 million US SMEs

    Alibaba targets 30 million US SMEs

    Alibaba has opened its platform to enable US businesses to sell their products to millions of Alibaba.com buyers in the US and around the globe.

    The nearly 30 million small and medium-sized businesses in the US – especially manufacturers, wholesalers, and distributors – can now better access the US$23.9 trillion global B2B e-commerce market, an opportunity that is six times larger than the global B2C e-commerce market.

    Alibaba is also co-producing a series of “Build Up” workshops and webinars with local chambers of commerce and B2B organizations across the country – including Score, one of the nation’s largest non-profit networks of volunteer, expert business mentors.

    “Alibaba aims to empower entrepreneurs and help them succeed on their own terms,” said Alibaba Group’s head of North America B2B John Caplan. “With 10 million active business buyers in over 190 countries and regions, we are reshaping B2B commerce by providing the tools and services needed for US SMB companies to compete and succeed in today’s global marketplace.”

    “Alibaba’s announcement to welcome US sellers onto its B2B marketplace shows the Chinese retail giant’s desire to diversify its product offering,” said Emarketer principal analyst Jillian Ryan.

    “Currently, about 90 percent of the goods sold on the marketplace are from factories in China that are often manufacturing custom goods-to-order for buyers across the globe. Buyers on the platform are from developed nations like the US, Canada, India, Australia, Brazil, and the UK, and these buyers want to be able to source goods from the US.”

    As part of its extended services, Alibaba has streamlined the ability to build and manage a single digital store on the global Alibaba.com platform; added valuable transaction capabilities, including online payment; built CRM and communications tools to facilitate the direct ownership of customer relationships; enhanced digital marketing tools to target any appropriate B2B demand; and provided an option to work with Alibaba.com’s US-based Seller Success team.

  • Alibaba signs deal for AliExpress Russia

    Alibaba signs deal for AliExpress Russia

    Alibaba Group has formed a US$2 billion joint venture AliExpress Russia to create a major e-commerce venture in the Russian-speaking market.

    Alibaba and the Russian government-backed RDIF sovereign wealth fund will each invest US$100 million in the venture which will absorb Alibaba’s existing AliExpress business. Russian mobile phone network Megafon will sell its 9.97 per cent interest in internet group Mail.ru to Alibaba in return for a 24.3 per cent stake in the new JV.

    In return, Mail.ru will roll its Pandao e-commerce business into AliExpress Russia and contribute $184 million in cash for a 15 per cent share.

    AliExpress Russia has been created to expand the three companies’ e-commerce offer in both Russia and neighbouring countries.

    Documents to create AliExpress Russia were signed last week. The company will be jointly run by Alibaba and Mail.ru, each of which will appoint a CEO.

    “This partnership will enable the AliExpress Russia JV to accelerate the development of the digital consumer economy of Russia and CIS countries in ways that no one party could accomplish alone,” said Daniel Zhang, CEO of Alibaba Group. “Together, we are uniquely positioned to offer consumers in Russia and neighbouring countries an innovative shopping experience by combining social platforms with commerce, as well as enabling regional brands and SMEs to sell their products locally and globally.”

    He said Alibaba’s mission is to make it easy to do business anywhere. “This JV is an important part of Alibaba’s international expansion and step toward our goal of supporting 10 million small businesses reach profitability and serving 2 billion consumers around the world.”

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  • Foreign e-tailers must have registered entity in India: Draft policy

    Foreign e-tailers must have registered entity in India: Draft policy

    E-commerce sites or apps available for download in India must have a registered business entity in the country, according to latest draft e-commerce policy, which also proposes regulation of cross-border flow of data collected by sector players in India.

    According to analysts, the move to make it mandatory for foreign online retailers to register entities in India follows the relatively recent spread and expansion in the country of Chinese e-commerce platforms which do not have an Indian presence.

    These include Chinese portals such as Shein, Romwe and AliExpress and the proposed registration norms come after complaints made to the government by traders’ bodies like the All India Online Vendor Association about Chinese online operators shipping cheaper products to Indian customers as gifts in order to avoid customs duty.

    As per the proposed norms, all foreign e-commerce sites must have a registered business entity in India as the importer on record or as the entity through which all sales in India are transacted.

    The draft policy has also proposed a ban on all parcels designated as gifts, with the exception of life-saving drugs.

    Moreover, as per the draft policy, all data collected by e-tailers in India and stored abroad should not be made available to other business entities outside the country, for any purpose, even with customer consent.

    However, the government will have the right to access the data of Indian consumers stored abroad.

    Restrictions on cross-border flows of data would not apply to data which is not collected in India, business-to-business (B2B) data sent to India as part of a commercial contract between a business entity located outside India and an Indian business entity.

    Software and cloud computing services involving technology-related data flows, which have no personal or community implications and multi-national companies, moving data across borders, which is largely internal to the company and its ecosystem, would not have to follow the regulations.

    New foreign direct investment (FDI) norms, which prohibit the e-tailers from selling products of companies in which they have stakes, came into effect on February 1 despite both Amazon and Walmart seeking a six-month delay in their implementation.

    The second e-commerce draft policy has been welcomed by sector players like Snapdeal and trader associations such as the Confederation of All India Traders (CAIT).

    Snapdeal said the draft policy’s rejection of inventory based e-commerce must be followed by effective implementation of FDI norms to ensure marketplaces do not own or control inventory, directly or indirectly.

    “The recognition of data as a strategic national asset is well-timed and will lead to the development of required regulation in this regard,” a Snapdeal spokesperson said.

    US giants Amazon and Walmart, which recently acquired a 77 percent majority stake in the Indian e-retail major Flipkart, said they are reviewing the draft e-commerce policy and will share their inputs on the proposals in course of time.

    Amazon has been forced to remove an array of products from its India website in order to comply with the new FDI regulations in e-commerce.

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  • What to learn from China’s Singles’ Day?

    What to learn from China’s Singles’ Day?

    Ever since the first Singles’ Day or 11.11 sale began in China in 2009, every year, there would be plenty of commentary explaining the phenomenon to an international audience. This doesn’t appear to be necessary any more.

    In its tenth edition, the event has grown into the world’s largest shopping festival where 180,000 brands participate and consumers take less than two hours to spend a phenomenal 100 billion yuan ($14.5 billion).

    It is an event in its own right. Not an imitation, but something that that consistently pushes the boundaries in terms of content, tie-ins and consumption. In 2012, sales for Singles’ Day first surpassed Cyber Monday and Black Friday in the US.

    And so effectively targeting buying power has been a focus for many international marketers. Given the volume of purchases and the willingness of Chinese consumers to embrace new technologies, it is also a true testing ground for brand owners.

    Three major changes are to take our from this year’s 11.11.

    Mini-programs take centre stage

    For brands and retailers, mini-programs have become a core marketing channel.

    Considering WeChat’s active user traffic of one billion, this comes as no surprise.

    Within WeChat’s ecosystem, mini-programs provide connectivity between social, content and payment. For example, retailers in a shopping mall can distribute free parking vouchers using mini-programs and they will be able to generate information on the arrival time and spending habits, as well as which customers own a car.

    According to official figures from WeChat, as of July 2018, it had over one million mini-programs with users opening them four times per day on average.

    A survey by China’s big data service provider QuestMobile has identified the most important functions of a mini-program: effectively combining online and offline activities; sharing customer information; serving as a standalone e-commerce platform; and the ability to combine the physical aspects of a promotional campaign with social marketing.

    Growth in short videos

    Data reveals companies using short video sharing platforms, such as TikTok and Kuaishou, received the majority of the 11.11 targeted advertising traffic.

    Community is king

    In China there are Social+ platforms that present a lucrative opportunity for both content and word-of-mouth marketing. Xiaohongshu, which is backed by Alibaba, has 150 million users consisting of the social media generation born in the 90s. They use the platform like Facebook and are highly influenced by shopping tips and insight from celebrities.

    A completely different interest group is Babytree, an online parenting platform that uses a similar vertical marketing model and presents another attractive opportunity for advertisers.

    These platforms provide an engaging forum for like-minded people and are realising the tangible benefits of teaming up with major e-commerce operators.

    All the above changes highlight how brands and consumers are moving away from purely a transactional shopping experience. Instead, it’s more collaborative and relationship-based, changing the dynamics of e-commerce. There is ample evidence of this phenomenon developing in other markets.

    Lessons from the East

    At $30.8 billion, the online sales of 11.11 surpassed this year’s figures for Black Friday ($6.22 billion) and Cyber Monday ($7.9 billion) in the US. But both these figures for the US represent a 24% and 20% respective increase on last year.

    While the results illustrate a gap in retail ecosystems between the two largest economies, there is clearly a growing preference by US consumers for digital channels rather than elbowing through crowded stores the day after their Thanksgiving dinner.

    In a poll by Periscope By McKinsey in October 2018, roughly a month before the sales, nearly half of the respondents (48%) said that they plan to shop more online while fewer (28%) said they plan to do so in-store.

    China’s highly sophisticated online shopping behaviour has leapfrogged the development of retail that has been commonplace in most Western countries. In doing so, it now sets the world standard in e-commerce.

    Any marketers who want to successfully compete in this huge and attractive market need to be digital and mobile led in their strategies. But 11.11 does not just represent an opportunity for sales in China. The trends and habits should be understood as they will provide the inspiration for other markets where online spending is also growing.

    Brands that can adapt these successful models may well be able to transfer success.

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  • South Koreans spending more on Chinese online stores

    South Koreans spending more on Chinese online stores

    South Koreans are spending more at Chinese online stores, according to credit-card spending data. Purchase records from November 1-26, compiled by the big data centre at Shinhan Card, showed a 9.8 per cent increase from last year in the value of goods bought from overseas internet sites. The number of transactions was up 16.6 per cent year on year.

    Chinese online stores outperformed rivals from other countries. AliExpress took 9.5 per cent of the purchases, up from 6 per cent in 2016 and 6.1 per cent last year. It ranked second after Amazon’s 16.3 per cent.

    Taobao, another Chinese Internet shopping site, grew from 2.3 per cent in 2016 to 3.3 per cent last year and to 4.4 per cent this year, raising it to the third most-used overseas online marketplace. Alibaba made it to the top 10 for the first time this year with 1 per cent.

    The shift is stark when comparing the purchases during Black Friday in the US and Singles Day in China. This year, overseas shopping during Singles Day rose 35 per cent. Black Friday purchases stopped at a 9 per cent gain.

    Data showed 70.8 per cent of purchases during Singles’ Day were for goods priced up to 50,000 won (US$44.32). Shoppers in their 30s and 40s remained the biggest clients, but the number of those in their 20s increased 1.9 percentage points from last year.

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  • Alibaba to open e-commerce hub in Belgium

    Alibaba to open e-commerce hub in Belgium

    Alibaba Group Holding Ltd has signed an agreement with the Belgium government to launch an e-commerce trade hub, which will include investments in logistics infrastructure. The project is part of Alibaba’s Electronic World Trade Platform (eWTP), and Belgium is the first European country to join the project following similar agreements in Malaysia and Rwanda.

    Alibaba’s logistics arm, Cainiao, will lease a 220,000 square meter logistics port at Belgium’s Liege airport as part of the deal and invest an initial 75 million euros ($85 million) in the project set to begin operations in 2021, it said.

    “We strongly believe that under the eWTP, we will open up the huge potential for European businesses to reap the benefits of global cross-border trade, especially into the China market,” Alibaba CEO Daniel Zhang said in a statement.

    Alibaba’s eWTP is designed to help countries reduce trade barriers for e-commerce trade, including lowering or eliminating tariffs and speeding up customs clearance.

    The company has previously said the project is designed to “compliment” the World Trade Organization (WTO).

    Alibaba is expanding the project to Europe amid wider trade tensions, which have forced the firm to back down from efforts to tap U.S. sellers.

    Recently, Alibaba Chairman Jack Ma said previous plans to create a million jobs in the United States had been put on ice due to trade tensions, according to Chinese state media.

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  • El Corte Ingles inked global distribution deal with Alibaba

    El Corte Ingles inked global distribution deal with Alibaba

    Spanish department store operator El Corte Ingles is to open a flagship store on Alibaba’s Tmall as part of a broad collaborative approach to reaching Chinese consumers. In a wide-ranging agreement, El Corte Ingles and Alibaba will enable a raft of Spanish and international brands commonly sold in El Corte Ingles department stores, to be sold worldwide via both AliExpress and Tmall.

    AliExpress will consider opening a number of physical stores at El Corte Ingles shopping centres in Spain to create a unique and engaging shopping experience while promoting some of its latest products available to Spanish shoppers. This follows a trial pop-up store in the El Corte Ingles Sanchinarro shopping centre in Madrid earlier this month during Alibaba’s 11.11 Global Shopping Festival.

    El Corte Ingles and Alibaba say they will also explore closer cooperation in delivery and supply-chain infrastructure and channels, allowing Alibaba to benefit from the Spanish company’s logistics knowledge and capabilities in the country, and explore the use of its distribution centres as collection points for online purchases made through AliExpress.

    Smart payments

    El Corte Ingles signed an agreement with Alibaba’s Alipay in March to bring seamless payment experience to Chinese tourists visiting Spain. This may now be expanded, as El Corte Ingles and Alibaba will work on creating new shopping experiences for Chinese visitors.

    El Corte Ingles CEO Victor del Pozo said the agreement will allow the two companies to combine both the physical and online worlds to offer the best shopping experience to its customers.

    “Together, we are writing the future and placing ourselves at the forefront of trade and technology. El Corte Ingles owns department stores in the best locations of the main cities of Spain and Portugal, and is granted with the confidence and trust of national and international customers. All of this, joined to Alibaba’s technology, will allow us to offer a proposal of unbeatable value.”

    Alibaba Group MD for Italy, Spain, Portugal and Greece, and BDM for Tmall in Europe, Rodrigo Cipriani Foresio, said digital transformation and innovation in all fields are fundamental drivers of Alibaba’s mission of making it easy to do business anywhere, with the ultimate goal of better serving consumers and stakeholders worldwide.

    “Hence, we are confident that the expertise and skills brought by both companies will generate incredible value and opportunities as the cooperation takes shape.”

    El Corte Ingles, which opened in 1940, is Europe’s largest chain of department stores.

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