Alibaba’s U.S. strategy is about getting more American companies on its platform to sell to Chinese consumers — not about trying to market to U.S. consumers, the company’s founder and executive chairman, Jack Ma, emphasized on Tuesday.
“We need more American products to go to China,” Ma said at Tuesday’s Economic Club of New York gathering at the Waldorf Astoria during a weeklong U.S. trip. Ma penned a Wall Street Journal op-ed [paywall] describing the opportunity for U.S. companies.
In his speech, Ma said the growing middle class in China is nearly the same size as the total U.S. population and expected to grow. This middle class is looking for quality products, and according to Ma, China doesn’t have the resources on its own to provide them.
In the U.S., “you have all the shops offline — Walmart, Kmart, everything,” Ma said. “But in China you have nothing. E-commerce in the U.S. is the dessert, complementary to the main business. But in China it becomes the main course.” Alibaba already sells products from American sellers on its site. Ma cited cherries, Alaskan seafood, lobsters and nuts as some of the most popular goods. But he wants even more sellers to join Alibaba, and that’s why he’s in the U.S.
In the past, China has focused on export-led growth. Ma wants to help change that reality and shift the focus to imports and consumption by China’s growing middle class.
Ever since Alibaba’s buzzy IPO in September, some have speculated whether the company would expand its marketplace to U.S. consumers. Further investments in American-based start-ups have only furthered such speculation. Ma was adamant, however, that he has no plans to try to take on Amazon (AMZN – Get Report) and eBay (EBAY – Get Report) on their home turf.
People keep on asking, Now, you’re big. What’s your play in America? When are you going to come invade America?” Ma said. “We show great respect for Amazon and eBay, but the strategy for us is helping small businesses in America sell their products in China.”
Source: The Street.com