Mobile Payments Leader Alibaba Readies Its New Marketplace For the US: eMarketer

July 25, 2019         By: Steven Anderson

We’ve paid plenty of attention to Alibaba thanks to Alipay, its mobile payments arm. New word recently emerged that it was planning to allow US sellers access to the Alibaba marketplace. That was prime time for eMarketer to step in and offer some comment on the move and on its ecommerce figures, and it sent its remarks on the topic out our way for consideration.

Consider we did. The word from eMarketer presented an exciting picture in its own right; eMarketer’s principal analyst Jillian Ryan pointed out that about 90 percent of the goods being sold on Alibaba’s marketplace come from factories in China that often manufacture on a “…custom, goods-to-order” basis for customers worldwide.

Since buyers on this platform include operations in the US, Australia, Canada, Brazil and more—and often want to be able to purchase from the US as well—having a slate of US-made goods show up on the site as well means a great opportunity to better access these markets. Some US vendors are already in place, like Office Depot, but it’s hoped this move will open up the SMB market.

As for its ecommerce sales, it was a good news / bad news situation. First, Alibaba’s ecommerce operations saw hefty gains, set to reach $1.082 trillion by the end of this year, and further projected to clear $1.290 trillion in 2020. However, the pace of gain is down; in 2018, the numbers grew 22.8 percent, while in 2019, the numbers are set to grow 19.2 percent over 2018’s figures. In 2020, meanwhile, the growth will be just 19.1 percent, suggesting that meteoric rises may be coming to an end, eventually.

Opening up the platform to US sellers may be a good way to pump some extra growth into those numbers, and may also serve as a way to work around the currently-in-play trade war. It certainly doesn’t help US manufacturers who want to get their products into the Chinese market, which is the second largest on Earth and, by some measures, poised to be the largest in short order.

It also opens up new opportunities for mobile payments issuers like Alipay to make new cash processing payments for those goods, which, given the state of Alibaba’s growth right now, could come in quite handy.