Alibaba Battles with Amazon in Southeast Asia

Alibaba Battles with Amazon in Southeast Asia

Done betting, Alibaba is getting down to work in Southeast Asia as it bids to lead the region’s promising e-commerce space and maximize its early mover advantage over Amazon.

Alibaba became the first major international player to enter Southeast Asia, a region with more than 600 million cumulative consumers, when it bought a majority stake in Lazada, the Rocket Internet-backed venture, nearly one year ago. Amazon, Alibaba’s key foe in India, is still to make its move, having pushed back a planned Q1 2017 entry to later this year.

If the Lazada deal was a test of the water, then Alibaba is now ready to get soaked. Two smaller (but notable) developments this week show it is executing on a plan to build out a strong presence in Southeast Asia, where e-commerce is forecast to reach $88 billion by 2025, according to a 2016 report co-authored by Google.


Removing barriers, opening doors to China

Alibaba Executive Chairman Jack Ma has spent the past year hobnobbing with a range of heads of state across the region’s key countries, including Singapore, Thailand and Indonesia. This week, Ma’s dabbling in politics bore its first fruit as Malaysia’s government partnered with his e-commerce firm — and its affiliates Cainiao (logistics), Ant Financial (fintech) and Lazada — to launch a series of initiatives aimed at easing red tape and barriers around cross-border e-commerce in Malaysia. (Malaysia’s government appointed Ma as an economic advisor last November.)

Malaysian Prime Minister Najib Razak, Alibaba CEO Ma and Lazada CEO Max Bittner were among the many attendees at the free trade zone event in Kuala Lumpur, Malaysia. Image:
Malaysian Prime Minister Najib Razak, Alibaba CEO Ma and Lazada CEO Max Bittner were among the many attendees at the free trade zone event in Kuala Lumpur, Malaysia. Image:


It is proof that the project is very much strategic to Alibaba’s aim of connecting Southeast Asia with China.

On home-turf it has hundreds of thousands of sellers operating across its Taobao marketplace and other services. Taobao is already embedded in many parts of the country — more than 1,000 so-called “Taobao Villages” have relied on the service to stimulate financial regeneration — and it could increase its audience further still through more direct links in Southeast Asia.

But Alibaba isn’t waiting around for initiatives like that in Malaysia to get off the ground, it is already forging opportunities for Taobao in Southeast Asia. This week, it bridged Taobao with Lazada through a new feature that debuted in Singapore. Lazada Singapore is boosting its existing catalog of five million products with the addition of 400,000 listings that have been selected from Taobao.

“We want to solve those difficulties, enabling an effortless way for them to shop. Now it’s all translated into English and you don’t have to worry about shipping options, payment method, returning. You are going to be able to track your order end-to-end,” Lazada Singapore head Alexis Lanternier told Bloomberg.

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Indah Gilang Pusparani

Indah is a researcher at Badan Perencanaan Pembangunan Penelitian dan Pengembangan Daerah Kota Cirebon (Regional Development Planning and Research Agency of Cirebon Municipality). She covers More international relations, tourism, and startups in Southeast Asia region and beyond. Indah graduated from MSc Development Administration and Planning from University College London, United Kingdom in 2015. She finished bachelor degree from International Relations from University of Indonesia in 2014, with two exchange programs in Political Science at National University of Singapore and New Media in Journalism at Ball State University, USA. She was awarded Diplomacy Award at Harvard World Model United Nations and named as Indonesian Gifted Researcher by Australian National University. She is Researcher at Regional Planning Board in Cirebon, West Java. She previously worked as Editor in Bening Communication, the Commonwealth Parliament Association UK, and diplomacy consulting firm Best Delegate LLC in USA. Less
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