Live shopping on Alibaba Taobao marketplace
Live shopping on Alibaba Taobao marketplace. The company wants to repeat the success of this strategy on its international marketplace AliExpress. Image: Screenshots.
Business

AliExpress' strategy to take e-commerce live streaming phenomenon to the world

The company's new platform bridges influencers and brands, and it has a bold goal: to attract over 1 million content creators, including in Latin America and Brazil, and make 100 of them millionaires in the next three years

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Having someone you know testing the products you want to buy live and, different from what already happens on TV, answering questions instantly, has everything to be the maximum e-commerce experience. It’s transparent, truthful. That’s the core idea behind AliExpress Connect, the platform by Alibaba‘s international online marketplace that bridges influencers and AliExpress’s top sellers and brands. 

Launched in late May, the platform is an asset for Alibaba, one of the pioneers when it comes to shopping videos, to attract and train up talented content creators worldwide. The project’s goal is bold: to attract more than 100,000 content creators worldwide this year, increasing this number to 1 million in the next three years, and to help at least 100 of them earn an annual income of more than $1 million within three years. “Yes, you might think that this is a bold goal, but the truth is that is already happening in China. There are a lot of people earning more than that here,” says Martin Wang, AliExpress’s director for Social Commerce Cooperation, and Overseas Seller Operation since January this year, in an interview with LABS.

READ ALSO: Pinterest, Instagram, Facebook and the challenges on what it takes to be an e-commerce platform

With the platform, Alibaba intends to repeat on AliExpress the success it had on its local retail website, Taobao. On Taobao Live, the live streaming platform for merchants using Alibaba’s Taobao marketplace, the so-called key opinion leaders (KOLs) have made a real revolution in terms of sales. According to South China Morning Post, Taobao Live hit 2 billion yuan ($280 million) just 90 minutes after the midyear shopping festival officially launched at midnight on June 1.

And the mission may not be so difficult indeed. According to Alibaba’s first-quarter results, along with Lazada, the company’s Southeast Asian e-commerce platform, and other international businesses, AliExpress has reached 180 million active users in March. In China as a whole, Alibaba’s retail marketplaces ended March with 729 million active users. In the next five years, the company’s goal is to reach more than 1 billion Chinese consumers, and to continue to grow globally as its domestic market approaches saturation.

Although media outlets such as Bloomberg have said that Connect’s initial focus was Europe – mainly Russia, France, Spain, and Poland, where the majority of AliExpress’s users are –, Latin America is also an important target for the Chinese company.

We know that Latin America is the second-fastest-growing market for e-commerce, and we also know how social Latin Americans are, so of course that Connect’s potential in the region is huge

Martin Wang, AliExpress‘s director for Social Commerce Cooperation, and Overseas Seller Operation.

In times of global economic downturn caused by the COVID-19 pandemic for sure the biggest one in decades – Wang says that one of Connect’s key missions is to offer new income sources and job opportunities for influencers and content creators, giving them the access to new performance tools and important tips that can help them to scale their business. That’s why besides the PC version, AliExpress anticipated the launch of the mobile version of the platform as well.

The move is important not only in the face of the company’s rivals in China, but globally at a time when Facebook, Instagram, and Pinterest also created new features to boost purchases within their platforms.

LISTEN ALSO our PODCAST: E-commerce, payments, and work opportunities: what to expect from these topics in Latin America?

Why does AliExpress have influencers as a key brand strategy? 

The general idea is to make the consumer stay longer on the website, seeing and buying more products. In the middle of this process, the consumer also gets to know the brands better and to trust them. “People can see our products real-time, and through these live videos they can get a better sense of how these products work, to get usage instructions from people that speak their language, creating a new sensorial experience for e-commerce. Especially for cross-border e-commerce this is even more important, it gives people confidence (in products and brands),” stresses Ken Huang, AliExpress’s Head of Latin America

Huang says that, between the end of 2018 and the beginning of 2019, AliExpress started to work with influencers in Brazil, mostly with the major ones, with up to 30 million followers, and those influencers were truly effective on spreading out AliExpress’s image.

Live shopping on Alibaba Taobao marketplace. The company wants to repeat the success of this strategy on its international marketplace AliExpress. Image: Screenshots.

“As we moved forward we found out that the power of the media itself and the medium-size and micro KOLs were equally important. In last year’s Double 11 (November 11th, or China’s Singles Day, the country’s biggest sales date) we had over 120 million new followers coming through these influencers. Since then, we collaborated with over 100 influencers to promote our products in Brazil. And many of them are currently in AliExpress Connect,” explains Huang.

The executive says that the company uses not only Brazilian influencers in Brazil, but those that live in China. “We have recruited some of them, invited them to visit the factories too so that they can show where the products are made, while they are being made,” tells Huang.

READ ALSO: Valentine’s Day revenue in Brazil more than doubles compared to last year

How AliExpress Connect works

Influencers are invited to sign up to AliExpress Connect either individually or through their agencies. Registration on the platform can be done through one-click signup tied to the influencer Facebook, Instagram, Twitter, TikTok, VK, or Google accounts. 

Right after the registration, influencers can take numerous tasks and campaigns including creating original content for brands. Connect’s system also provides training and analytics tools to support their creative process.

AliExpress sellers, in their turn, can also post tasks directly into Connect, using filters to select the most suitable influencers for those tasks.

AliExpress’ 10th anniversary in Brazil

Even with an initial drop in sales from February primarily due to supply chain and logistics disruption caused by the COVID-19 pandemic, but also because of the social isolation measures in Brazil, Huang says that AliExpress has not given up on its plans for the country.

Brazil is always among the company’s five largest markets, and Latin America is the second-largest-growing market for e-commerce in the world. In this year of 2020, the company celebrates its 10th anniversary in Brazil.

READ ALSO: Brazilians plan to keep or increase shopping frequency on international ecommerce platforms

“The pandemic has affected everyone, and AliExpress is no exception. It brought us challenges, but also opportunities,” Huang told LABS. In the short term, as a way of ensuring and improving the company’s services to the Brazilian customers, AliExpress closed new air freight deals and launched new delivery and payment options.

In March, AliExpress started allowing Brazilians to pay for their credit card purchases in up to 12 installments. Also in May, AliExpress launched AliExpress Direct, a new service tjat consolidates products for the user and saves their money by sending all their products in just one package. Since AliExpress is a “market”, products purchased from different stores are usually shipped independently by different sellers. AliExpress Direct coordinates all sellers and, therefore, can consolidate all products from the same user in one shipment.

The AliExpress Direct shipping fee is US$ 3 (BRL 14), but if the total payment exceeds US$ 30 (BRL 140), AliExpress Direct fee will be free. In other words, users will be able to enjoy free shipping on AliExpress Direct orders over US$ 30. Currently, the new service is available for most products under $10 (BRL 46).

In addition, AliExpress launched a free return service. Now, the consumer can return the product within 15 days after receiving the orders, without having to pay the return fee and will have a refund, once the receipt and product conditions are confirmed. This option is available for all products with the “Free return” icon on the product details page.

And early this month, the company closed an agreement for two weekly flights between China and Brazil and Chile with the airline cargo company Atlas Air. The measure, according to the executive, has the objective of guaranteeing the delivery time of parcels despite the COVID-19 pandemic setbacks. 

Flights are being chartered by a partnership between Cainiao and the freight integrator Sinotrans. According to Air Cargo World, the first flight to Latin America arrived at Guarulhos International Airport, in the São Paulo region, on June 6.

Medium to long-term plans

In addition to the short term actions already mentioned, Huang said that AliExpress maintains its medium-term plan of having a distribution center in Brazil and that the company is also in negotiation to build local partnerships in logistics.

“We haven’t reached any official partnership for this warehouse yet. But this continues to be a medium to a long-term plan, and when the time is right and the conditions are right we’ll move forward,” stresses Huang to LABS.