Why is Alibaba interested in the Benelux?

Will Chinese internet giant Alibaba consider its Benelux office a mere footnote in its existence or is there a reason for this specific move? In any case, the Chinese market has a huge appetite for any Western brand product.

Empire

Chinese English professor Jack Ma founded alibaba.com in 1999 in order to sell Chinese products to the rest of the world. Soon, it turned out that the fast-growing Chinese market was also an interesting market: the entrepreneur quickly expanded his reach with new websites and services. Nowadays, Alibaba Group is much more than just an online retailer, it is a vast empire.

It owns the Chinese counterpart to eBay, online marketplace Taobao. It is so successful that eBay’s attempts to conquer the Chinese market and even acquire Taobao simply failed. Alibaba also owns web shop Tmall, which sells Chinese and international products to its Chinese consumer base. Its Benelux office will guide Benelux-based companies to start selling products on Tmall and therefore reach the huge Chinese market.

Payment app

Other properties are web shop Juhuasuan.com, which specializes in flash deals, internet services company AliCloud and web shop aliexpress.com, which draws in an increasing number of Western consumers looking for cheap Chinese electronics, which are also shipped for free.

The company also developed AliPay, a smartphone payment service similar to PayPal. It has also become an important means of payment for physical retailers, an actual alternative to the typical card that failed to really penetrate China’s retail. AliPay may actually break through in Europe as well, as an increasing number of Chinese tourists come here and want to use the app to pay for purchases.

Food and toys

It has become clear that Alibaba not only wants to sell Chinese products to the rest of the world, but also wants things to go into the other direction, selling Western products to China. Its local middle-class is growing very fast, while its spending power increases and equally its thirst for consumption. Consider the huge impact of China’s Singles Day on 11 November, the Chinese equivalent to Black Friday in the United States.

The group now services 500 million Chinese consumers, who love Western brand products as those are considered a matter of prestige. Not only luxury brands like Rolex or BMW are in high demand, dairy, chocolate and alcoholic beverages are equally in demand. Even flowers, consumer electronics, household products, baby products and toys are popular. 

A new Benelux office also opens up doors for smaller, local manufacturers that were unable to reach the Chinese market. Former Blokker CEO Roland Palmer will prove to be a good acquisition as he is familiar with the eCommerce market and the shopping habits in the Low Countries, which will create opportunities…