Maggie Zhou - Alibaba Group Australia New Zealand



Maggie Zhou - Alibaba Group Australia New ZealandHOST:Maggie Zhou from Alibaba Group Australia and New Zealand can't be with us in person, but, luckily, joins us by video conference from Melbourne where she's making a major announcement this afternoon for Alibaba. Maggie has witnessed major changes in the company and rapid growth in China's e-commerce sector. She was one of the founders of the Taobao Marketplace in 2003. It's a consumer-to-consumer platform, which has become the world's biggest e-commerce website. Alibaba's Single's Day has become a shopping phenomenon. And events like the coronavirus have provided both a challenge for the business and an opportunity. Alibaba, I read, has been a major donor to fighting coronavirus pledging over AU $200 million to various relief measures. It's been very - it is very timely to have Maggie Zhou with us, even if she is by conference - video conference. And, as this event continues to unfold, Maggie Zhou, thank you for joining us.MAGGIE ZHOU:Thank you, Sarina. Morning, everyone. So, first of all, I would like to apologise for not being in attendance in person in today's event in Canberra. Can you all hear me?SPEAKER:Yes.MAGGIE ZHOU:OK, sounds good. OK, sorry for I can not be there. But I would like to share very exciting news from today. And, this morning, the Gemma Foundation just announced that $3.2 million contribution to the Doherty Institute for Infection and Immunity out here in Melbourne towards accelerating the development of the vaccine to combat coronavirus. So, unfortunately, I have unexpected engagement at the Institute. (INAUDIBLE). I'm required to attend. So, I apologise again, but I'm delighted to be here in my Melbourne office via video conference with today's exceptional line-up. And I do hope you have all had a nice, enjoyable morning so far. So, I guess you could say my speaking about Chinese consumers at today's conference is quite topical, isn't it? I guess the answer is yes, right? So, first, I will - I'm going to cover some recent events and some of the trends and consumer behaviour changes we are seeing in China. And then, I will talk about Alibaba and how we are working with Australian brands and the producers as the gateway to the China market. So, Jeff always mentioned crisis is opportunity. That doesn't mean crisis itself is opportunity. Actually, it is how we can convert the crisis into the opportunity. So, up until the coronavirus outbreak, Alibaba has allowed a range of measures, as well Sarina mentioned. Yeah, we help the small, medium-sized company in China. So, we will reduce or waive fees across our platform such as Tmall, TaoBao, Cainiao and et cetera. And Alibaba is also offering a range of relief measures for those merchants outside China including those from Australian selling via Alibaba's team or global platform. But, on the other hand, actually, we also find out that the coronavirus outbreak is shifting consumer behaviour in China with many consumers venturing outdoors, and that's over the past few weeks. So, more and more consumers are getting comfortable with taking care of their daily living needs and, also, like the working requirements through digital means. So, we have seen significant increase in purchase of a grocery online. So, in China, Songmart is the largest hypermarket in the market Offline, almost 80% of their 486 hypermarkets operated by the Songmart already shutdown. But their revenue just remains the steady. And just in this spring festival, the Chinese Lunar Year, their online sales almost quadrupled just at the same period of last year. So, it is really - we see that is a different trend. In the offline, there's impacted, but online, actually, is much, much active than ever before. And the livestreaming become as a very popular way for many of the merchants and brands and the celebrities. So, the brands like the BMW also love arranging those livestreaming to introduce car models interiors and the experience for test drives. And, also, in this, there's the spring festival, and there is a Valentine's Day, right? So, we ever - just the first-ever - run the TaoBao live for the celebrities and the musicians. They do the philanthropic cloud concert through online. They're just performing from their home and attracting more than 4 million viewers and help them - help those farmers to just sell out about 380,000kg agriculture produced through that - this platform. And just about 0.5 million RMB - more than 0.5 million RMB - those money go to support all that. And a very interesting phenomenon in some of the head of the village, they're also using livestreaming and introduce the fresh food like the vegetable and the fruit from their farm to consumers. So, we found that this online market's much, much active. So, anyway, I think the coronavirus will end. I hope that it will pass quickly, right. But when those opportunities come back, we and the Australian producers are getting ready for those opportunity.So, in China, which you - yeah. You may know that China's middle class is the largest emerging market globally. So, over 1 billion users, they're using the mobile in every day. And there's 30% yearly increase last year. And the forecast for the imports of the goods and the services will exceed US $40 trillion by 2043. So, it's really still a big market, right. And, also, those continued user growths has not only come from city dwellers. 70% of the new consumers, they are from the less-developed area. In China, there are more than 60 - sorry, 600 million people that are living in rural area. So, we observed that, from 2012, many of the farmers, they started their business online. So, we started to help them. So, Alibaba actually - the rural development was our strategy. So, we're trying to use those digital technology to help those farmers, villagers to develop their business. So, from that, we just help them to build up the Taobao Villages and the Taobao Towns to promoting the rural economy in China. So, what is the Taobao Village? There is a definition on the bottom left. So, the administrative village is the unit, and the annual e-commerce turnover exceeded $10 million and more than 100 active online stores in the village. That is called a Taobao Village. And what is Taobao Town? More than three Taobao Village in the town that can be called the Taobao Town. So, in 2019, last year, Taobao Village have already covered 25 provinces and 121 cities and 398 districts with a population of more than 2,000 - sorry, 250 million. And what's the growths? Those village and towns, their online sales already have more than 700 billion RMB annually. And there are 2.44 million active online store and generated more than 6.83 million job opportunities. So, maybe these just a showcase, case study, to understand how we can support the rural development, rural economy, in China. Maybe, for Australian, there's thinking about how to leverage those offline opportunity going to online opportunity. Yeah, so, really just thinking about those villagers and towns. So many commerce has already started the business online. And they themselves also become very familiar and comfortable to getting used to shopping online, as well, to buying something they cannot buy in the village. So, their habit has already, also, cultivated by the e-commerce. And China's online consumer's a big opportunity, also, for Australian brands, manufacturers, and food producers. The (INAUDIBLE) to the very strong country image of Australian with the clean and green products. So, just looking at the Australian strong performance, yeah. With Australian, now, we're ranking the top five countries selling to China. We're ranking the number four in last year Double 11 Shopping Festival. And our health supplement brands, Swisse, Bio Island, they already rank in the top five cross-border products globally, not only just from Australia. And we also have very competitive on those category globally, like the food grocery and house care products, mother and baby, and the beauty and the personal care, as well. And under this coronavirus, also, we observed many of the hygiene products are also very popular to China markets. And the people and the more - and they more care about their own health and their immunity. So, that's really, also, a good opportunity for Australian products, as well.So, this is back to our Alibaba's mission to make easy to do business anywhere. And this mission started from the very beginning of Alibaba. And we have never changed. And, in this digital era, we're also thinking how to utilise those digital technology to help the Australian and New Zealand, those businesses. How to help them to make easy to do business anywhere utilising the whole opportunity on our ecosystem. And this is our ecosystem, and you can see just - even just in the retail market, we have already 824 million mobile monthly active users. And there are 22,000 international brands selling on our platform to China and 38% year over year revenue growth. This is a whole our digital economy. So, we have the online the core commerce on the left including online business and offline business. So, which Alibaba actually started from 1999. We started from the flagships business with . This is a wholesale platform. In 2003, we started our C2C platform Taobao and like eBay here. And, 2008, we started Tmall. It's a B2C platform to help the brands to sell the product to the consumer directly, right. And the Tmall global is a cross-border e-commerce. To help the Australian brands, we only have the credence in Australian, and anything Australian but don't have the presence in China that allow you to sell your products from Australia directly to China. And they deliver from Australia to China. But, of course, also, including those products already pre-stored in the body warehouse in China. So, this is online businesses, but, also, Alibaba, we acquired, also, invested some of the business offline. So, like a (INAUDIBLE) is the big-mouth hippo. This Freshippo is our new retail. I'll just mention this business later. In the (INAUDIBLE), what I mentioned just now, they're actually very steady about their revenue under this coronavirus, right. So, Suni is an electronic - is a supermarket. And the (INAUDIBLE) is for fashion, and (SPEAKS FOREIGN LANGUAGE) is the for furniture and category. So, we, today, actually, in China, online and offline combine together. They're integrated. And we also in this ecosystem have the digital media entertainment. Youku is similar like YouTube here. And we're using those platform integrated with the whole Alibaba - the ecosystem, helping them to using the livestreaming or some short video to just introduce those products or those (INAUDIBLE), and it can generate the transaction directly. And, also, we have the local services like the (INAUDIBLE), like UberEats here. And Fliggy is a travel platform on Alibaba ecosystem. And, even on this - under this coronavirus, the home deliveries, they're active. So, we're using those business on our platform to help support the citizen, the consumers, even they are staying at home. How can you fly those home delivery? And they're home at fresh for their daily living needs to help them to - for even for their every-day three meals, yeah. So, on the above is the commerce and digital entertainment and the local services, but all these are supported by our (INAUDIBLE) these platforms. China is our logistic platform using the data - data to help the merchants to run their businesses efficiently. And Alibaba is our just online advertising platform to help them to touch the more broader market using those - more marketers to help them to promote. And Alipay's our payment master to help - today, in China, is, really, a cashless society. And this is payment master. Also, now, in Australia, we have many local businesses to enable them to use Alipay to access to Chinese residents, tourists, and the students. But, even today, those students come back to Australian under the travel ban. But we found, actually, more than 50% of our Alipay users, they are the local Chinese residents. So, still a great opportunity for those to using this platform to help them - their business. And (INAUDIBLE) Computing is just helping to raise the capability for those businesses to - also for Australian business through China, are also in the local how to use the technology to support. OK, so, talking about so many businesses may have you confused. What's the opportunity for Australian business go to China markets? So many business. Which one I need to grab? I just say, just depend on the stage of your brand awareness in China. So, if your brand awareness is very low, just very new for you to - for the Chinese market, you may just start it from the incubation about your brand awareness. So, Taobao Global and many of the individual merchants and POLs are online celebrities also helping the Australian brands to promote their brand awareness into China market. And, now, also, our local flagship event like Alibaba e-commerce as well, we were wrong in sending Melbourne and Oakland every 18 months to help those Australian brands to step into China market, not only move the physical and this local market. But when your brand just awareness accumulated gradually, and maybe in the median stage and the Taobao umbrella store can also help you. And, also, our own team or direct order platform also can just purchasing directly from you and help to cultivate your brand awareness in China on our platform. And when your brand is already very - is going to mature, Tmall Global can also help you. You can open your store on our list platform using the third-party GP to help you to operate the store and deliver the product from here to China directly. And when you are already very, very famous in China like the big brand, and, then, you have your own presence in China. You have your own team in China. You have your own inventory in China. And you may use Tmall to sell your products to Chinese consumer directly. So, today, in Australia, many of the brands are like - you know, today, the 2,000 Australian brand in our platform, they are getting more and more famous. And I'm very proud that - that the Chemist Warehouse now they're retailing Australia, the pharmacy. They become the largest international merchant on our platform. But, five years ago, actually, in China, no one knows them. And no one knows the brand. But, today, actually, even last year, Double 11, they only use more than seven hours to achieve 100 million RMB just in 24 hours just this on our platform. So, now, actually, they're also to set up the physical store in China. And I feel that's a really the step-by-step - the strategy when you step into the new market. OK, so, this is our over 2,000 trusted Australian brands on our platform. So, you will find those brands are also very, very familiar. And they're all sold very well, like the Wine, Penfolds, and Yellowtail. Yeah, and, also, more Australian one, now, is a sale on our platform, and we found, actually, Australian brand import is already much, much bigger than French brand, our French one in China market. And you can see freedom, the food, Woolworths, and, also, milk powder. And some of those groceries and the beef in our Hema Fresh. Now, it's just listed here. Just we would purchase directly from Hema Fresh. This is Double 11 Shopping Festival. And we run it from - we create it by ourselves from 2009. And the last year is our 11th year on the - it is a big marketing event. We run it every year and is already the world's largest annual retail event hailed the Double 11. And, also, we will run the gala - Double 11 Party. And, also, it is really a great marketing event for all the brands used in this day to marketing to the consumer, celebrating the festival, and to just then say thank you to the consumer, give them some big surprise. And, the last year, we record in US $48.4 billion in GMV just in achieving 24 hours.So, in China, not online, yeah, maybe... yeah, we started C2C platform, Taobao, from 2003. So, more than 15 years ago, I see people, yeah, just talking about how to leverage the opportunity from offline to online. And, now, when China is - everyone just the - most of the people and shopping online. We are also talking about how to leverage all the business - the opportunity to online-offline combine together. So, this is Hema Fresh, the Freshippo is, really, our showcase about the new retail. What is new retail? New retail is online-offline combined together - integrate together. So, when consumer stay at home, they can shop online through the app, through Hema Fresh to order the products and allow Hema Fresh to deliver the products to your door through the store to your door within 30 minutes. And this is only just of the citizen living 3km radius. But, also, you can go to the physical store at weekend with your family members. And when you find this Australian base, Australian roster, and you can also have those products cooked by the chef in the store and dining in the store. But, later, when you still have the time to shopping in physically, you just stay at home. Like a coronavirus, everyone just only can stay at home to shop online, right. So, this shopping means has really become this very phenomenon for Chinese citizens now, even like the grocery, the fresh, those food and fruits and the dairy and even rice. They're using these platform to - for their daily needs. So, you can see those Freshippo model. We work with those production base for the procurement and allow the delivery 30 minutes to their door and serve the three miles away. And, also, you can dine in the store, yeah. So, that's just online-offline combined together in the core of the new retail. Actually ace the service. So, that's a future trend. OK, so, at the end, so, mention all the things I want to cover today on the opportunity, the challenge in China. But always the - we found throughout. Alibaba always just monitoring the challenge and opportunity very closely, both with our own business and the merchants on this platform. And opportunities always deliver, yeah. So, are you getting ready if the opportunities come? More information, welcome to visit our website, .au Thank you, everyone.ENDS ................
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