Chinese e-commerce giant Alibaba is coming to the US in a major way
- Alibaba is cozying up to US business owners by rolling out expanded digital tools to help build e-commerce storefronts on the platform and develop targeted marketing to potential customers.
- The Chinese e-commerce juggernaut also announced a collaboration with Robinson Fresh - a US supplier that works with brands like Tropicana, Welch's, and Green Giant - following the debut of its partnership with Office Depot in March.
- "We're creating the ability for small businesses and large wholesalers in the United States to source and trade with each other and for small businesses to sell their products to countries all over the world," Michael Evans, Alibaba Group president, said at a press event on Monday.
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Chinese e-commerce giant Alibaba is courting American small business owners with a spate of new digital tools designed to encourage domestic trade and increase US participation in the the $23.9 trillion global B2B market.
The expanded program will provide 30 million American manufacturers with access to resources to help create their own e-commerce sites on Alibaba, as well as build out digital marketing campaigns.
As part of the launch on Tuesday, Alibaba also announced a partnership with Robinson Fresh, a US supplier of food brands like Welch's and Tropicana, coming on the heels of its collaboration with Office Depot earlier this year.
The bid for US business is part of a larger globalization strategy by Alibaba - the largest B2B e-commerce marketplace in the world, with more than $768 billion in sales in 2018 - to grow its business in international markets. US suppliers will be required to pay an annual membership fee of $2,000 (with no commission fees) to access the tools and tap into Alibaba's network.
Alibaba goes all-in on globalization
"China has been, for a long, long time, a terrific source of good quality, relatively inexpensive products," Michael Evans, president of Alibaba Group, said at a press event at Alibaba's New York City office on Monday.
"Today we're creating the ability for small businesses and large wholesalers in the United States to source and trade with each other and for small businesses to sell their products to countries all over the world."
The bulk of Alibaba's business currently remains in China, where the company has 720 million users on the platform, compared to 150 million users across the company's 189 other markets, according to Evans. Expanding into new regions - while getting a leg up over Amazon through massive shopping events like Singles Day and Super September - have been key areas of focus for the company.
"Our US strategy, if you look back four years, started with an understanding that our competitive advantage was not to come here and try and do what Amazon does," Evans said. "It's to basically take the great American brands and sell their products to the Chinese consumer on our platform who loves American products, and we've been phenomenally successful with that."
Both Evans and John Caplan, head of Alibaba North America, touched on geopolitical tension from proposed Chinese tariffs on US manufacturing that, if enacted, would likely impact how Alibaba and its consumers do business. For example, Alibaba previously hosted an event series called "Gateway," focused on teaching companies how to build a China-ready business. Ultimately, Evans said Alibaba decided "it was probably not a great idea to continue to make that such a high-profile focus."
"The important thing, for the owners we've spoken to, is that they're still scouting around for solutions," Caplan said at the event on Monday. "There isn't a one-size-fits-all for every small business owner because it depends what you source and what you use the products you source for."
Alibaba wants to help small businesses get online
According to Caplan, the new platform will be particularly helpful for the 61% of American manufacturers who do not presently have a digital presence, as well as the 71% of small businesses that do not sell online.
"Getting new customers is hard, and when you have an online store, you don't automatically have customers," Caplan said. "There has been, up until now, no global platform you can join where you could actually get customers all over the planet, and we're trying to combine the best of those two capabilities for US small businesses."
The enhanced Alibaba platform will further help US sellers by providing marketing tools to reach specific demographic segments and targeted customers. It will also allow the US - which accounts for one-third of Alibaba's sales demand - to more seamlessly conduct business domestically, as well as with neighboring countries like Canada.
"If small businesses are successful, Main Street is successful, our schools are successful, our communities are successful," he said. "The lifeblood of the US economy is small business."
Get the latest Alibaba stock price here.
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