New | Alibaba chief executive highlights rural e-commerce, reaching urban consumers, global imports as key 2016 targets
Alibaba Group, the world’s largest e-commerce services provider, is looking to ratchet up its operations in mainland China’s largest cities this year, while continuing to make further headway in the country’s rural areas.
Chief executive Daniel Zhang Yong presented the outline on Wednesday as part of a three-pronged business strategy, but provided few details.
“We are going to consolidate and expand our current market, particularly by enhancing reputation, optimising user experience and increasing our market share in first-tier cities,” Zhang told employees at Alibaba’s headquarters in Hangzhou.
The sharpened focus in the country’s major cities follows Alibaba’s decision to establish a second headquarters in Beijing, where the company launched its Singles Day online shopping promotions in November.
Online retail operations in the Chinese capital have already been increased in terms of offering groceries and consumer electronics, according to the company.
Alibaba also saw Beijing as a gateway to serve 400 million potential customers in northern China, where e-commerce can help connect communities that lag the sophisticated physical infrastructure of the coastal provinces.
“Global import, rural e-commerce, and top-tier cities are the three key battlefields for Alibaba in 2016,” Zhang said.
The New York-listed company’s priorities last year were international expansion and greater promotion of online retail activities across the China’s vast rural areas.
Zhang said the company aims to strengthen its online channels to better enable international brands to reach Chinese consumers.
These efforts will be focused on Alibaba’s Tmall Global, a cross-border shopping platform that helps foreign companies connect with Chinese consumers, and g.taobao.com, a niche channel within the company’s Taobao Marketplace platform for consumers to discover quality products sourced from around the world.
“We are going to build our businesses around the two brands,” Zhang said.
The company also plans more investments in its rural operations.
Alibaba said it has built more than 10,000 village-level service centres to promote e-commerce and provide delivery services in more than 20 provinces.
“We are going to ramp up our efforts to bring quality goods to rural buyers, and deliver local produce to urban customers,” Zhang said.
Efforts by Alibaba and other e-commerce services providers on the mainland, such as Tencent Holdings-backed JD.com, are expected to further boost domestic consumption..
New York-based research firm eMarketer has forecast China’s total retail e-commerce sales in 2018 to increase 133 per cent to US$1.57 trillion, up from an estimated US$672 billion last year.
