Alibaba competes with Amazon in Europe for Singles Day

Workers pack crates with merchandise for orders at a Cainiao warehouse, the logistics subsidiary of Alibaba Group Holding, forward of the corporate’s annual Singles’ Day procuring extravaganza in Wuxi, Jiangsu province, China, on Nov. 9, 2020.

Qilai Shen | Bloomberg | Getty Photographs

BEIJING — Alibaba is investing additional in Europe for Singles Day this 12 months, because the Chinese language tech big competes with Amazon for the European Union’s exploding e-commerce market.

Alibaba remained among the many prime three on-line sellers of shopper items in jap Europe final 12 months, in line with Euromonitor Worldwide. Amazon wasn’t on the highest 10 record for the area, which incorporates nations like Poland and the Czech Republic.

Amazon is by far the highest vendor in western Europe, which incorporates France and Spain, in line with Euromonitor. However the U.S. e-commerce big’s market share within the area didn’t develop throughout the pandemic, remaining at about 19.3% in 2020.

In distinction, Alibaba’s market share elevated to 2.9% in 2020, up from 2% the prior 12 months, the info confirmed.

Alibaba held first place in jap Europe e-commerce in 2019, in line with Euromonitor Worldwide. However Polish on-line procuring website Allegro took first place in 2020 throughout the pandemic, whereas Russian rival Wildberries took second, in line with the info. That pushed Alibaba down to 3rd place final 12 months.

The competitors for Europe comes as on-line procuring within the area bought one other raise this 12 months. Keep-home insurance policies and different social distancing measures have remained in place for a lot of months amid a chronic battle to regulate a number of waves of Covid-19 outbreaks.

“It is time for the following stage of e-commerce progress in Europe,” NielsenIQ mentioned in a report in June.

For “fast-moving shopper items” — a class that features meals, drinks, private care and residential care — the report mentioned e-commerce gross sales progress doubled in Italy and Spain within the first quarter of this 12 months, in contrast with the identical interval in 2020. Up to date figures weren’t out there as of the publication of this text.

Alibaba prepares for Singles Day — in Europe

Alibaba is eager to experience that wave of progress. Completely different enterprise models have introduced enlargement into Europe within the weeks main as much as the Singles Day procuring pageant.

The procuring occasion, spearheaded by Alibaba in China, is much like Black Friday within the U.S. or Amazon’s Prime Day. Singles Day is also called “Double 11” because it falls on the eleventh day of the eleventh month of the 12 months — Nov. 11.

In recent times, Alibaba has promoted the procuring pageant abroad by means of its personal e-commerce web site for promoting to shoppers exterior of China, known as AliExpress. The platform largely connects Chinese language sellers with abroad consumers, permitting overseas companies and shoppers to purchase straight from factories in China.

Double 11 goes to be a good way for lots of those firms as they begin to develop. It is a good way so that you can go purchase clients.

Jonathan Cheng

accomplice, Bain & Firm

Spain, Russia and Brazil are among the many core nations for AliExpress’ abroad enlargement, Li Dawei, head of AliExpress Provide Chain, instructed CNBC in a Mandarin cellphone interview earlier this month.

Alibaba founder Jack Ma is reportedly touring in Europe this month to review native agricultural practices and know-how, in his first journey away from larger China in additional than a 12 months. The corporate referred CNBC to the Jack Ma Basis, which didn’t instantly reply to a request for remark.

Subsidizing supply prices

AliExpress plans to double its subsidies for worldwide logistics assist this Singles Day from final 12 months. That is a slowdown in tempo from the corporate’s claims final 12 months that it spent 5 instances as a lot on subsidies because it did in 2019.

AliExpress claimed, throughout a interval of world transport congestion, that it didn’t increase prices for patrons and hasn’t seen any main supply delays due to its reliance on constitution flights. Most items bought by means of AliExpress are additionally small shopper merchandise and do not must be transported by ship.

For Singles Day, AliExpress mentioned weekly abroad constitution flights will enhance to 100 per week from Nov. 11 and 30, up from 80 per week.

Alibaba’s logistics arm Cainiao launched package deal lockers in main cities in Spain and France in September 2021. Forward of Nov. 11, on Singles Day, Alibaba sped up its funding in package deal lockers, which permit couriers to ship many packages to 1 neighborhood’s residents directly.


As soon as the packages go away China, they are often distributed at logistics arm Cainiao’s sorting facilities, six in Europe and one in Russia, in line with the corporate.

The procuring pageant has additionally sped up funding in package deal lockers, which permit couriers to ship many packages to 1 neighborhood’s residents directly.

In early September, Cainiao introduced it had put in a community of 170 lockers in Madrid and Barcelona in Spain, and greater than 80 in Paris, France. The logistics unit mentioned it deliberate to put in a complete of 5,000 lockers globally earlier than Singles Day, particularly in Russia, Poland, Spain and France.

Cainiao and worldwide commerce retail income each grew by not less than 50% within the quarter that ended June 30 in comparison with a 12 months in the past, with the enterprise segments every accounting for about 5% of Alibaba’s general income.

Increase native clients

Not solely does AliExpress wish to promote to shoppers in Europe, it additionally desires native retailers to signal onto its platform, the place they will benefit from subsidies, mentioned Li, the top of AliExpress Provide Chain.

Nevertheless, he mentioned many companies desire to work with a number of e-commerce websites, as an alternative of simply with AliExpress alone.

Small and medium-sized retailers would additionally prefer to construct their very own manufacturers on these platforms and on their very own web sites, Li mentioned, noting that in these circumstances, AliExpress performs extra of third-party position by promoting logistics and retailer administration providers.

Learn extra about China from CNBC Professional

“Usually I believe there’s a number of studying from China when it comes to, how do you concentrate on e-commerce,” Jonathan Cheng, accomplice at Bain & Firm and chief of the agency’s Better China Retail observe, mentioned on a name with reporters Wednesday. “We’d argue that China’s completely on the forefront when it comes to buyer operations, and in advertising and in effectiveness and all that.”

“Double 11 goes to be a good way for lots of those firms as they begin to develop. It is a good way so that you can go purchase clients,” Cheng mentioned, declining to remark particularly on Europe. “Amazon mainly did a really comparable factor.”

However he famous that after years of speedy progress within the variety of clients, firms will want to consider the best way to retain customers and earn income.

— CNBC’s Saheli Roy Choudhury contributed to the report.

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