Alibaba has made a landmark push into Europe seeking to challenge Amazon’s dominance by undercutting sellers’ fees by nearly half.
The Chinese ecommerce giant, which dwarfs Amazon in Asia boasting around 1 billion users, has made its first concerted push establish a foothold in Europe and attract new sellers to its international platform AliExpress.
Setting its sights initially on Spain and Italy, alongside Europe-Asia gateway countries like Russia and Turkey, Alibaba has slashed its commission fees in Spain to between five and eight per cent, Reuters reported.
This move is aimed specifically at poaching retailers who sell on the currently dominant Amazon, which charges €39 per month sales tax plus a seven to fifteen per cent commission.
The increasingly stagnant economic growth in China has forced Alibaba to focus on expanding into international markets, launching an English language website and allowing sellers from overseas to list on the platform for the first time over the past six months.
Although Alibaba says thousands of local sellers have signed up to AliExpress since it launched in Spain last year, many are understood to remain wary of the platform, still largely associated with Cheap Chinese goods.
According to six anonymous sources who spoke to Reuters, major European fashion brands like Benetton, Mango and Tendam have been approached by Alibaba with limited success, with brands stating they did not feel the platform was the right showcase for their products.
This follows a dramatic few months for Alibaba, which staged 2019’s largest secondary public listing on Hong Kong’s stock exchange, sending its shares climbing 11.8 per cent ever since.