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'It is in our DNA to put the customer first'

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DQI Bureau
New Update

Jonathan Lu was appointed as chief executive officer of Alibaba.com in February 2011, and later on elected to the board of directors of Alibaba.com in March 2011. He is also the executive vice president of Alibaba Group as well as the non-executive chairman of Taobao Marketplace. As the leader of the portal whose mission is 'to make it easy to do business anywhere', Lu talks to Dataquest about how he has taken measures to uphold it, make the site more accessible for small business owners to reach to the global audience, etc. Excerpts

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As an online portal, have you witnessed a greater use of the online medium by women for doing business online?

The internet provides a fair opportunity to entrepreneurs across the world, owing to which Alibaba.com now has more than 72.8 mn registered members from over 240 countries. However in some developed markets, such as the US and Australia, around 26% and 27%, respectively, registered member base are women. This significant percentage can be attributed to a multitude of factors but, more importantly, e-commerce is exposing female entrepreneurs to potential business opportunities in the global markets.

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In India, there has been a healthy growth of 71% y-o-y female registered members as of June 30, 2011, reflecting a positive trend. E-commerce is helping them detect future demands and adapt to the market changes in the dynamic business environment. As the economic recession affects the home, more and more women are also looking for ways to supplement their household income.



How has Alibaba.com contributed to the growth of the Indian SMEs?

India is a unique and a very important market for Alibaba.com because of its large MSME population (26 mn units), a robust domestic market and a growing export sector. India has emerged as a low-cost manufacturing base and an alternative supplier market to China for global buyers. The entrepreneurial spirit that is unique to Indians is being further bolstered by various SME-friendly government initiatives.

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We have contributed to the Indian SMEs by dedicating our efforts to educating, training, and serving Indian SMEs on how to effectively utilize e-commerce to grow their business both in India and abroad. Over the last few years, since first commencing local independent operations in India, we have organized training sessions on e-commerce and global trade for our gold supplier members in over 15 cities.

In addition, we re-launched the India channel (http://india.alibaba.com/) in our marketplace in September 2011. The India channel caters specifically to the Indian suppliers and provides an easy and efficient platform for international buyers to source from India.

E-commerce has witnessed a boom in India. How would you describe India's share in Alibaba.com's global pie?

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Before 2007, Alibaba.com invested in providing e-commerce in India the much-needed boost. With India comprising more than 10% of our registered members on our global platform, we feel an enormous responsibility in ensuring the growth of e-commerce in the market for the future.

Internet penetration in India has increased in the last year, with over 121 mn internet users, including 29 mn users from the rural population. As internet penetration continues its steady growth trajectory, e-commerce and Alibaba.com will continue to allow local businesses to penetrate other markets, local and abroad, in a fast and economical way.

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What we are continually seeing is that India is becoming both a supplier and a buyer market. More and more buyers in India are sourcing from within the country. In Q3 2011, 34% of the total inquiries received by the Indian suppliers were from Indian buyers (for example, suppliers in Ludhiana can now easily reach the buyers in Chennai or vice versa).

How would you describe 2011 in terms of IT implementation?

It is the DNA of our business operations to put the customer first. Our IT focus for 2011 centered on enhancing user quality and user experience, as well as strengthening the depth and breadth of user information captured on our platform. We also evolved our business model by developing performance based and transaction based services.

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In 2012, we will continue to focus on upgrading our e-commerce platform. Our original business model was to bring suppliers and buyers together to 'meet at Alibaba', now we are moving to a model of 'work at Alibaba', where IT is the key in driving this strategy. With 'work at Alibaba', we seek to use technology to provide suppliers with services beyond trade. We are providing software and internet infrastructure to help small businesses manage their customers and their company. We are exploring ways to incorporate social media that would allow the network business to increase their interactions. And we are already undertaking a project to develop multiple language versions of our international marketplace to serve better the growing international customer base.

Internet has provided the edge for every business. What is the road ahead for you?

Today, the 'online marketplace' has advanced considerably as more and more businesses are getting comfortable with this space. As internet penetration continues to expand, with over 121 mn internet users in India, we see a higher adoption of e-commerce by small businesses to generate further trade.

Our priority is to continue educating Indian SMEs about the relevance and benefits of e-commerce. In India, hundreds and thousands of suppliers are leveraging the internet through e-commerce to generate sales, leads, and enquiries. SMEs have been able to optimize on both big and small orders via e-commerce. International trade is no longer simply the realm of multinational companies. Millions of MSMEs around the world have gained visibility in the global marketplace through e-commerce. With the focus of business shifting towards India, it is time for more Indian MSME suppliers to make their move through e-commerce.

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