Q&A with Zhiyu Chen, Chief Commercial and Product Officer, AliExpress (Alibaba Group)
Exposure on AliExpress helps Chinese companies build brands globally
Strategies vary for developed and fast-growing markets
What important lessons can Chinese exporters learn from the global success of AliExpress?
It all starts with the products. Without a quality product it is not really possible to build an overseas business. Once you have a quality product, then it is important to invest in the brand building, which will facilitate business to go for long-term growth. A brand needs
to acquire new customers, which becomes increasingly challenging when a brand goes overseas. Advertising has its role, of course, in brand building but let’s not ignore the power of word-of-mouth. To achieve all of these objectives – a great product, a strong brand, a growing customer base, we need to recruit talented professionals with extensive experience in overseas operations and marketing. We can help Chinese brands that want to export for the first time or expand their export business. With high traffic on our website, exposure on AliExpress could help build a brand’s presence across many markets.
What approaches have you found to be most effective in communicating the AliExpress brand?
It varies by market. In developing markets, such as Brazil, Russia, and Africa, we relied a lot on word- of-mouth communications. This approach worked because we deliver a good consumer experience that has led to high customer loyalty and engagement, and strong organic growth. We are adopting a different approach for developed markets, such as Europe and the US. In developed markets the products our sellers offer need to be more sophisticated. We want to communicate to consumers that
we are a sophisticated brand and we provide a wide range of product offerings by quality Chinese sellers on our platform to meet their specific needs.
How do you communicate the brand in developed markets?
Because the developed markets are enormous and diverse, we look at niche sub-markets. Beyond these
niche markets, we also look for opportunities to serve the needs of mass-market consumers in developed markets by providing diverse and sophisticated products from our quality sellers.
As you build your global business, and you face strong competition, especially from Amazon, what are your competitive advantages?
It’s important to understand that AliExpress is a marketplace for individual merchants to sell their products directly to international consumers. AliExpress does not sell or store products directly, but we are a marketplace that connects global sellers and buyers. AliExpress targets millennials, and we are especially popular among young people in Russia and Spain. Also, in many overseas markets with large Chinese communities, consumers and it easy to shop on AliExpress. There also are operational or cultural differences between AliExpress and other e-commerce players. AliExpress is an open ecosystem that makes it easy for us to grow with our local partners in key markets.
How has Google helped AliExpress go global?
AliExpress has been working with Google since day one. Google and AliExpress cooperate broadly on mobile, branding and in other areas. AliExpress has a great YouTube channel and a live streaming promotion on Single’s Day. In addition, we always early test Google’s new products. We are using Google’s Smart Bidding, for example, to rapidly review millions of signals and find the optimum bid.
What kinds of potential mistakes should Chinese exporters try to avoid?
It is important to understand and respect the customs and practices
of local markets. Respect can be expressed in several ways, including setting up local companies and hiring local people. It is also important to be aware of government policies and regulations.
Alibaba’s record-breaking IPO on the New York Stock Exchange increased awareness of Chinese brands worldwide. Do you think that the image of Chinese brands and products is changing?
It depends on what part of the world we’re looking at. In Europe the perception is changing slowly. Some consumers still hold on to the perception that the “Made in China” label signals low quality, but that’s no longer true. China is moving through the same cycle that Japan and Korea went through a few decades ago and is building its reputation as a center for creation and high-quality manufacturing. But the transformation of Brand China will happen more quickly because of the increased speed of production and the information exchange in the Internet age. In addition, Chinese companies are among the leaders
in new businesses and technologies, such as virtual reality shopping and mobile app development.
Are there any generational influences on the transformation of Brand China?
Yes. The real game changers are young people. These customers can accelerate the improvement in the image of Brand China because they were born during a period when Chinese industry has already improved, and they are more
open to new things and products from overseas markets. They are consumers that would move the needle, and they enjoy online shopping.
What special steps is AliExpress taking to help change how overseas consumers view Chinese brands?
We are investing more in the e ort to build consumer trust in the “Made in China” products that consumers can buy on our platforms. Some of the specific initiatives include co-branding and co-marketing with local brands in an e ort to strengthen an image of trust and reliability. Russia is a good example of cooperation with local brands. With our app already downloaded to about 50 million smartphones in Russia, we receive a lot of orders from Russian consumers. But we cannot deliver to every address by ourselves. We work with local businesses to fulfill the delivery needs. The relationship leads to growth for both AliExpress and our local brand partners. It is win-win.
Ensuring customer satisfaction is critical for building and sustaining a brand and for elevating the image of Brand China. How do you ensure customer satisfaction across all the countries that you serve?
We have some standard practices across all country markets and we also adopt a tailor-made approach to cater to local conditions and local consumption behavior. In every place that we do business we will not tolerate any behavior that hurts the customer experience. We work closely with our partners to improve services.