Alibaba Group Holding Limited announced in late June and in May plans to expand its presence in South East Asia and Pakistan, even in the chinese consumers market worldwide.
The e-commerce giant will increase its stake in Lazada from the 51% they currently hold to a 83% through $3.5Bn investment.
“As a market leader, Lazada has demonstrated its ability to execute and further lead the region in products and services with the best consumer experience in Southeast Asia while growing a strong ecosystem that supports small businesses going online,” said Daniel Zhang, CEO of Alibaba Group. “The e-commerce markets in the region are still relatively untapped, and we see a very positive upward trajectory ahead of us. We will continue to put our resources to work in Southeast Asia through Lazada to capture these growth opportunities,” he added.
Alibaba Group announced on 12th June the official launch of Tmall World, which is aimed to connect the 100 million-strong overseas Chinese market worldwide with 1.2 billion products offered by brands and merchants through the Group’s flagship social commerce app Mobile Taobao and online platforms such as world.taobao.com.
On May 16th the Chinese multinational announced thet they have inked a MoU (memorandum of understanding) with the Trade Development Authority of Pakistan to support e-commerce development of SMEs and financial services for this kind of companies.
“With the globalization of e-commerce, developing countries are well-placed to support the growth of their small and medium enterprises and to seize opportunities which can help bolster their economies. E-commerce has been established for developing countries and for SMEs. Pakistan has seen significant progress in recent years and we look forward to working together with TDAP to further enhance the potential of their SMEs through the signing of this MoU,” “”Alibaba Group’s Executive Chairman, Jack Ma said
Lazada, a strategical purchase for growth
Alibaba’s investment in and collaboration with Lazada since April this year have been an important part of expanding Alibaba’s global footprint, providing it with unrivalled access to consumers in Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam. With only 3% of the region’s total retail sales conducted online, Southeast Asia is expected to offer tremendous growth potential.
Lazada recently launched Taobao Collection in Singapore and Malaysia to cater to local populations that don’t speak Chinese. Taobao Collection offers a wide range of curated products from electronics accessories, fashion to home and living from Taobao and Alibaba’s other marketplaces while providing customers with an end-to-end Lazada user experience including shopping, payment and logistics.
Alibaba will purchase the shares of certain Lazada shareholders valued at 3.15Bn reflecting a significant increase in the share price of Lazada since Alibaba first acquired its majority stake in April 2016. The transaction will increase Alibaba’s total investment in Lazada to over $2Bn. Lazada will continue to operate under the same brand following this investment.
Rooting deeper in Pakistan
Under the terms of the MoU, Alibaba, Ant Financial, and TDAP agree to foster growth of worldwide exports of products by small and medium sized enterprises (SMEs) in Pakistan through e-commerce. Online and offline training programs for the SMEs will also be conducted by Alibaba in a bid to assist SMEs with on-boarding on to Alibaba’s platforms and optimizing exports through e-commerce.
Alibaba Group Executive Chairman Jack Ma briefs the Pakistan Prime Minister at Alibaba’s Headquarters in Hangzhou, China.© Alibaba Group.
In addition, Alibaba, Ant Financial and TDAP have agreed to promote the growth of financial services in Pakistan in areas such as mobile and online payment services. The parties have also agreed to adopt cloud computing services to support the online and mobile e-commerce businesses of SMEs in Pakistan.
Tmall World to start off in selected markets
The priority markets to come under the TmallWorld program are Hong Kong, Taiwan, Singapore and Malaysia where the Group has already announced the kick-off of Tmall 6.18 Mid-Year Mega Sale. The three-day shopping festival, running from June 18-20, will offer discounts totaling RMB10 Bn to Mainland China and overseas customers.
In Hong Kong, where Tmall is already a household name, Alibaba will expand the product categories, adding Tmall Supermarket to the existing local offering.
Singapore and Malaysia have been included in the priority markets to offer Tmall World because of their sizeable Chinese population and the popularity of Taobao and Tmall with local users who want an online shopping experience with a Chinese-language interface.
Image over the headline.- Alibaba Group Executive Chairman Jack Ma welcomes Pakistan Prime Minister Nawaz Sharif at Alibaba’s headquarters in Hangzhou, China. © Alibaba Group.