Allison Hartsoe: 00:01 This is the Customer Equity Accelerator. If you are a marketing executive who wants to deliver bottom-line impact by identifying and connecting with revenue generating customers, then this is the show for you. I'm your host, Allison Hartsoe, CEO of Ambition Data. Each week I bring you the leaders behind the customer-centric revolution who share their expert advice. Are you ready to accelerate? Then let's go! Welcome everyone. Today's show is about gaining global customers, specifically in the context of Amazon's Prime Day versus Alibaba's singles day. And to help me discuss this topic is Alessandra Bruni. Alessandra joins us from Italy where she is a web content editor at CIF News, which if you haven't heard of this organization, you can find them at en.cifnews.com, and this is a Chinese news publication and cross border platform that is very helpful and understanding the Chinese market. Alessandra welcome to the show.
Alessandra Bruni: 01:12 Hi Allison. Thank you for having me here.
Allison Hartsoe: 01:14 Can you tell us a little bit more about your background because it's clear you're based in Italy, but you're writing for a Chinese news publication, and yet you understand the western world. How did you get into this mix?
Alessandra Bruni: 01:26 Yes, absolutely. When I was at university, I actually grew up sort of obsession with China. So first I graduated in Chinese language, and then I mastered in international relations with a focus on China. So when I started working as a web content editor, I knew I wanted to talk about this country. So when I started writing for CIS news that you mentioned it before, I was more than excited to write about China actually. And here is how I got in touch with the cross border e-commerce of China, and this is how I got so fascinated by it.
Allison Hartsoe: 02:03 It is very fascinating the market. And I want to start by talking a little bit about Alibaba's singles day, but we are coming right off Amazon's prime Day. So we're going to start there and then shift over to Amazon cause I, now I know our listeners are very much obsessed with Amazon in the market and how that's all shaping their retail world. So let's start with perhaps you could give us a little background about what singles day actually is.
Alessandra Bruni: 02:28 Yeah, single Day, who is proper name is Chinese Global Shopping Festival is actually Alibaba's Day of fave and discount. It lasts 24 hours, and it is important because last year it managed to eclipsed Amazon prime sales in just 10 minutes. This is why it's so important to talk about it. It actually occurs on November 11, so it is also called double 11, and the interesting fact is that it starts at midnight and last year, 10 minutes after the stroke of midnight, it already generated over $4 billion. So it exceeded the time the sales expectation for 2019, and after 20 minutes it already exceeded the black Friday sales and 24 hours it managed to generate over $30 billion. So in comparison, Amazon this year reached an estimated $7 billion over 48 hours two weeks ago. So it's also people know very little about Alibaba and single Day you can see that the comparison with overseas sales day is ruthless.
Allison Hartsoe: 03:35 It's amazing. And is Alibaba singles' Day just for the Chinese market or is it a global, you mentioned it's Chinese Global Shopping Festival?
Alessandra Bruni: 03:45 Well it is starting to reach every year more countries. Actually, it started as a Chinese shopping festival, but then it spread all over the world with three other platforms like Timo World, Lazada and Aliexpress and that serves the Southeast Asian market and the European market. So last year almost 230 countries participated in the event. So actually today the trend is to copy what China is doing from Facebook to Amazon. Many US tech giants are copying what Alibaba selling promoting strategies like the concert with Taylor Swift for last prime days. Just an attempt to copy the Global Shopping Festival countdown gala. So it is actually impacting how we perceive online shopping. So for sure, I can say that it's a shopping festival for everyone today since we are starting to know that it's existence section.
Allison Hartsoe: 04:42 And so the numbers that you cited at the beginning in 10 minutes surpassing prime Day, does that include 230 countries or is that Ali Baba in China alone surpassing?
Alessandra Bruni: 04:54 No, no, no. It includes all the countries say is.
Allison Hartsoe: 04:58 And I think that's what's so interesting you've hit on two points that I really think are fascinating. One is that we oftentimes think of Amazon as a global platform, mostly US-centric, but oftentimes very easy to use in other countries. But yet Alibaba has made a very strong concerted effort to go after the global audience. So if I'm a retailer today, and I want to sell to a global audience, this volume that Ali Baba represents is quite compelling compared to the Amazon volume. Yes?
Alessandra Bruni: 05:30 Yes, it is. It actually, there's a whole ecosystem made of online retail and offline retail, and this is what makes it so different from overseas platforms and the reason that nobody else can reach what Alibaba's single Day it means for China. It comes down to from the fundamental differences between the two worlds West and the east actually and the two platforms like Amazon and Prime day is all about Amazon, but Alibaba makes the single Day revolves around brands that people love and around sellers. Its Chairman Jack Ma used to say that Alibaba is not the Chinese version of Amazon, but Amazon and eBay are e-commerce platforms. But Alibaba is not because it helps others to do e-commerce, but it doesn't actually sell things on the platform.
Allison Hartsoe: 06:24 That is a really interesting point because I noticed the top products sold on Prime Day this year were even more Amazon products are ranking up in the top, the echo, other Amazon, the fire stick. These were basically like Amazon takeovers, and then all the other retailers were kind of following along. But what you're saying is the philosophy at Alibaba is completely different. So tell me as a retailer, why should I care about the Alibaba platform? We've touched on how it's different, but maybe you could elucidate a little bit more about why it's different for retailers.
Alessandra Bruni: 06:59 Well, why you should reach the Chinese platform? Well, it's easy because China has the world's largest internet population, so reaching the Chinese customer base is a huge opportunity for foreign brands. In fact, during the last single Day, 40% of buyers purchased from international brands. Yeah, a lot. And at the event is also that thing sales record year after year. So it's impressing these, it's still growing. So it definitely is a huge opportunity for everyone who chose to sell on the platform. Absolutely.
Allison Hartsoe: 07:36 And when they sell on this platform, can you help us understand a little bit about how it's different. Today, retailers are really struggling with keeping up with the Amazon platform because there's this tension where Amazon is doing Amazon essentials, and they have their own products versus the retailer products. And yet you just said a few minutes ago, Alibaba is not the Amazon of China. How was it different for sellers on Alibaba?
Alessandra Bruni: 08:03 Well, it is different because sellers can differently from Amazon, they can market on the platform, they can also benefit from cross-promotional and how to say like they can promote some different channel on the same day. Leveraging both online platforms like multiple e-commerce websites or messaging apps, but they can also leverage the offline experiences made of popup stores and exclusive events. And behind the Alibaba's records, there is actually a wise use of new technology like Robot, warehouses, big data, artificial intelligence. So Alibaba is leveraging the most innovative technology of the future to set new marketing trends that are now spreading in the whole world. Like if you think about the live streaming shopping, it all started when Alibaba broadcast on ten different platforms. The see now buy now fashion show where customers could buy clothes in real-time while watching the live streaming of the fashion show.
Alessandra Bruni: 09:07 So this is something that started in China, and it's a trend that is now spreading all over the world, and it's an absolute opportunity for brands to gain visibility and to gain engagement. Um, moreover is the only shopping in China is not just an act of purchase, it's rather a way to engage and entertain. So what Alibaba did is building an engaging environment where customers are always entertained. And the fact that more US social network like Facebook are introducing e-commerce features shows that it's not just the Chinese trend, but people starting to ask for more while shopping actually. So I can add that retailers can, yeah. As I said before, actually retailers benefit from an entire ecosystem supported by online apps and offline experiences, and Jack Ma, the chairman, calls the new retail. It's the combination of offline and online retail. And this is something Amazon is not offering right now.
Allison Hartsoe: 10:03 And when you talk about that online and offline, that beautiful synergy does it necessitate that shop that retailers who sell on Alibaba are able to directly communicate with the buyers?
Alessandra Bruni: 10:18 Without the buyers, I think they can benefit from the tools that Chinese platforms offer, but they need a deeper understanding of the Chinese market because I don't know, just running alone in this lobbying of platforms and experiences confusing, but Chinese companies have many tools to help the sellers to win in their markets.
Allison Hartsoe: 10:44 So, but I want to come back to this particular point because one of the points of friction for western sellers on Amazon is they sell the product, but they get no data back or very, very little data back about who bought the product, and basically they get a shipping address and then they're not allowed to communicate directly very much with that buyer. And what I think I'm hearing on the Alibaba platform is not only are you allowed to communicate with a person who is purchasing your product, but Alibaba's platform is specifically designed to help you create these online-offline events. They have the tools that basically smooth this interaction and help people purchase more.
Alessandra Bruni: 11:28 Yeah, yeah, yeah, absolutely. Retailers on Alibaba are allowed to market within the platform. And I could say also outside the platform because all the apps and website I would say are connected among them. So all the apps like messaging apps are communicating with one each other. So what the retailer does on Alibaba, so actually on each marketplace, like Taobao is creating a relationship with the buyer. So not only he can offer discounts after the sale to the buyer, but he can offer to the customer like promotions and events. Like if the seller decides to launch a live streaming in another app, that app is probably connected with the first app the buyer used. So the buyer managed to follow them, the brand all over in each platform and all over the platform. The brand use actually. Yeah.
Allison Hartsoe: 12:27 So I think what you're saying is through Alibaba's tools and marketplace technology, there is Alibaba benefits from the interconnectedness underneath of empowering the retailer. So whether the retailer is offering a discount on the sale or offering a promotion in an event, they're still benefiting because the actual transaction might take place using Alipay or using another messaging system. So even it's not that they're losing the sales. So an Amazon, there's a strict, you know, you can't sell offline because Amazon has no payment technology. Well, I shouldn't say it doesn't have a payment technology. It doesn't have a massively integrated payment technology. So if I sell at my website, Amazon doesn't see that sale. They don't benefit from that sale. But Alibaba has a platform that's powering retailers off the Alibaba platform as well. Is that fair?
Alessandra Bruni: 13:22 Yeah. Yeah. It's just a place where sellers can sell the products actually. So they're not forced to do their sellers on Alibaba's platform, but they can switch from one app to another. Like within the ecosystem, the Chinese ecosystem, like using Wechat, there are many mini-programs where brands can also open their flagship stores. It is different from the Amazon way of selling, and so it's complicated to explain, but actually, it's more interconnected yet and engaging. So Alibaba too is like Aliexpress, if you ever used it, it's like going on social network or Taobao as well with its live streaming platform as well, so it's not just selling on Alibaba, it's just using Alibaba to sell on Taobao, Tmall and all the platforms available.
Allison Hartsoe: 14:16 I got it. Yeah, so there's more of a partnership and empowering type of relationship that Alibaba is using in the market for retailers. And if we compare that to Amazon, what we saw on Prime Day was other retailers, Nike, best buy other companies running their own promotions at the same time to essentially compete with Amazon and try to get the same uplift from Prime Day. And is it, am I right to assume that you don't see that kind of competition in China when Singles day happens because it's so integrated?
Alessandra Bruni: 14:54 Yeah. It's not considered competition that, well there is, but it's not considered competition. Actually, the single Day is the global shopping festival of every kind of platform, but it is sponsored by Alibaba, but even the other tech giants like jd.com have offered discounts on Single Day, so they all participate to the event. It's not like considered competition, and every platform has its own online shopping festival actually during the year, and they also participate to the prime Day and say is actually. And this year it's a growing trend to offer discounts for the Day of the brand day. Is that right? Yeah, yeah, yeah, yeah. It's growing,
Allison Hartsoe: 15:37 but I don't know. Have we seen that on the western side? Have we seen US retailers offering discounts on singles Day?
Alessandra Bruni: 15:45 No, not outside the single Day. Actually. I only saw brands leveraging the Chinese single days so actually marketing for Chinese buyers now. So, but I think it's a trend that it will change because the more we get to know the single Day, the more the brands will address to less than customers. Like this year I was one of the western customers, but, and I think next year some brands will address their sales to the Italian market maybe. So I think this is where we are going actually, even though now it's, they just addressed the Chinese market and well the Southeast Asian as well, but it's not so popular like the Amazon Prime Day abroad.
Allison Hartsoe: 16:30 Do we know the percentage of US customers who participate in either singles' Day or the global shopping festival or in Alibaba as a whole?
Alessandra Bruni: 16:42 Well, I don't have the exact percentage, but I know that US customers were the second-largest customer base of the last Alabama single day. And it was only Japan went first and then in the second place they were American customers actually.
Allison Hartsoe: 16:59 Interesting. So if a US retailer is not participating in singles Day for Alibaba, this is perhaps a big gap.
Alessandra Bruni: 17:07 Yeah, I think so. Even because as I mentioned before, China's population is the largest internet population in the world, so it's a huge opportunity and a big gap to feel if someone is not marketing in China.
Allison Hartsoe: 17:22 Let's talk about the sectors for a minute. You know, oftentimes in Amazon, there's a thinking that certain types of products, perhaps the more unique the product, the better it will perform on Amazon and the less it's subject to cannibalization from Amazon's essential. I think that might be true today, but in Alibaba, are there certain sectors that perform better than others? When a retailer thinking about, should I sell in this category or not?
Alessandra Bruni: 17:52 Well, I saw that according to research, last single Day, food and drink were two of the most popular categories to buy from, like Australian milk was both a lot and Chinese heavy crab also sold over 1 million of pay re crabs and during the first hour of festivals.
Allison Hartsoe: 18:12 Wow.
Alessandra Bruni: 18:13 Yeah, and meat powder as well. But this is a new trend. Usually, on Single Day people prefer to buy makeup and beauty products, especially from South Korea. And they usually buy useful things for themselves or the family compared to Amazon buyers I guess? So but the food and drink category has been a novelty this year their popularity.
Allison Hartsoe: 18:38 And so I have to ask, especially since I'm living here in Oregon, one of the fastest-growing categories in the startup space, particularly in the US market, has to do with cannabis and CBD products. CBD products have to do with marijuana derivatives. Are those also sold on Alibaba?
Alessandra Bruni: 18:56 No, I didn't read anything about it, but I don't think it would become popular any soon in China because the regulation about light trucks as well is very strict. And I'm not aware about any discussion on a governmental level about legalizing like CBD products. So anything like that, I'm not well informed about that.
Allison Hartsoe: 19:19 Okay, good to know. Another difference in the market. So I want to circle back to something that you alluded to in the beginning, and then we've kind of been dancing around a little bit. And this has to do with an article that you just put on the front of CIF news about connected marketplace technology or really technology that China seems to be leading with. And this is not the first time I've heard this. I've seen some other stories in the last, probably the last two or three years about silicon valley starting to take its cues from China instead of the reverse, were trying to use to come over and see what was new in Silicon Valley and then replicate. That paradigm has changed. So can you talk a little bit about some of the innovation that's happening in the Chinese market, particularly for retailers that might support their growth?
Alessandra Bruni: 20:09 Well, are you talking about the technology innovation in China?
Allison Hartsoe: 20:13 Yes.
Alessandra Bruni: 20:13 Well actually China is going through a lot over the last years. It's starting well from the factory of the world. It actually became the innovation country for excellence. It's investing a lot in new technologies like 5G or robotics, artificial intelligence, and even blockchain. And so it's achieving a lot in technology in right now. So, of course, both the online platforms and buyers and retailers now can benefit of this research in new technologies. For retailers, it's very important because as I said before, they now can leverage the whole ecosystem that can lie on new technologies. Like in the case of Alibaba, the wide use of big data is what allows the platform to perform better and retailers as well. And then artificial intelligence and robotics, it's what is driving like the switch to our domain, the warehouses. So even delivery time processes now is even faster than before. Like there are many brands like Nike this year that are relying on drone deliveries. So it's a big change because now they can serve rural customers faster than before.
Allison Hartsoe: 21:32 Oh Wow.
Alessandra Bruni: 21:33 Yeah. So I think they are benefiting a lot from the Chinese switch towards new technologies and all the investments because, of course, these are the technologies of the future. So they just had both the customers and retailers to better perform them at the least.
Allison Hartsoe: 21:50 Are there other examples of brands innovating in China and then maybe thinking about that for the US or just taking advantage of Chinese innovations like you just mentioned with Nike and drone delivery?
Alessandra Bruni: 22:03 Well, actually even I could mention two brands that performed particularly well in the last single Day. In addition to Nike, there is also Lancome that features thanks to the new technology. It's the French cosmetics house virtually brought its Chinese buyers to Paris. So I mean that it built 62 feet long paper plane near the Eiffel Tower and then it opened up popup store in Beijing, and both the CDs launched the Livestream to offer an interactive and exclusive experience just the Day before the single Day. So this is probably a good example of leveraging the new technologies during the global festival
Allison Hartsoe: 22:44 and well, it's not just a good example of new technology, but it's also a good example of the entertainment combined with shopping. They're obviously selecting certain buyers, perhaps their best buyers or people they want to become their best buyers and bringing them into this store to give them a special experience. Is that fair?
Alessandra Bruni: 23:04 Yes, of course, there is a like a big research before these kinds of events, and I think that things, the start of the idea, the new technologies have had a lot in creating these kinds of experience and of course the technologies because it was live-streamed in two different countries into different, I don't know, continents in real-time.
Allison Hartsoe: 23:26 I think those two examples are great examples and certainly iconic brands, whether it's Lancome or Nike. I'm sure there are plenty more who are looking at interesting ways to sell on social media or to sell with live streaming and experimenting with this, and the platform makes it just easier for them. So let's say that I'm convinced and I am a fairly new retailer, or maybe I've been around for a couple of years in the United States market and I want to try Alibaba or, you know, start parts of the Alibaba platform. I realized when we say Alibaba there's really quite the ecosystem here. What should I do first in order to explore this market?
Alessandra Bruni: 24:02 Well first, I would suggest to go and check the Chinese tech giants. Because there is a whole ecosystem out there and it is led by the two Chinese titans like Alibaba but also Tencent. So I would suggest also to starting being familiar with their platforms like WeChat to start in addition to the other e-commerce giant which is jd.com, but other important social commerce platforms can not be ignored anymore, and such e-commerce refers to those marketplace with social media features and those social networks with e-commerce features. And two examples are Pinduoduo or Xiaohongshu and also live-streaming platforms like ticktock now have become very crucial. So moreover I would say the single Day is not the only big sale event in China because there is also jd.com meet year Shao ting festival, which is the second most important in China and it's called 618 then there's Alibaba's double 12 in December, Taobao six six festival in June.
Alessandra Bruni: 25:04 And so shopping festivals in China are a real culture phenomenon. So knowing them and understanding them very well is extremely important right now. So here comes the CIF news to help because I know it can be confusing. So I would suggest to go and check CIS news. The company I write for because it is the first Chinese media specializing cross border e-commerce in particular for over six-year it has been connecting Chinese manufacturers and brands with global markets, and it became the largest service platform right now in China cross border e-commerce industry because it's working with 16 industrial districts in China and it connects them with global players like Google, Facebook, Amazon, Waze. And it has also offices in China and in Europe. So it's very easy to reach. And it also organizes conferences, workshops, and forums. And last year it opened at its business centering Xiamen in China, and it provides facilities for international cross border companies that want to enter the Chinese market. So it actually helps Chinese companies to enter the Chinese market. And the other way around, I would suggest to check that.
Allison Hartsoe: 26:18 That's what I thought you were saying cause it sounded like originally this platform was helping Chinese companies move to the global market and then perhaps helping US manufacturers find industrial working districts. But now that paradigm seems to have changed a little bit. And in addition to doing that, they're also helping US retailers enter the Chinese retail market.
Alessandra Bruni: 26:42 Yeah. Of course.
Allison Hartsoe: 26:43 And could you go back to the two social networks that you mentioned? These were Chinese words that I don't think our listeners would naturally hear or would naturally know. You mentioned there were two strong Chinese, yes. Social networks. Could you say those again?
Alessandra Bruni: 26:57 Yeah, these are two social commerce platforms, Pinduoduo and Xiaohongshu, and they're very popular in China. It's a combination of, well actually they are two, well, Xiaohongshu started as a social network and then it's combined e-commerce features, while Pinduoduo was born as a group buying deals for customers and it is particularly popular in lower-tier cities, so it's actually growing a lot in China. It is a very new social commerce, and it also overtakes the other e-commerce giant jd.com thing, Chinese sales. So it's important to know them because they're growing and they're gaining wide consumer base in China and they also new for western retailers because they offer both social networks features and e-commerce features as well as the other platforms. I mentioned it before.
Allison Hartsoe: 27:53 Great. Well. We will link to those in the show notes as well as to CIF news. Now, if there are ways that people want to get in touch, whether they want to explore the platform or whether they want to reach you personally, how would you suggest that they reach out?
Alessandra Bruni: 28:08 I can be reached at my LinkedIn profile and I will be more than happy to engage with people interested in this topic to talk about it even more and or you can either contact CIF news directly on the website or social media profiles for an in-depth study of cross border e-commerce environment in China in particular.
Allison Hartsoe: 28:30 Excellent. So Alessandra Bruni is on LinkedIn. It's not hard to find her. There are a couple Alessandra Bruni's out there, so make sure you look for the one that says web editor at CIF News and that will get you right to her. As always, everything we discussed is going to be at ambitiondata.com/podcast. Alessandra, I've really enjoyed our conversation. Thank you so much for joining us today.
Alessandra Bruni: 28:54 Thank you Allison. I loved it too.
Allison Hartsoe: 28:56 Your perspective is so valuable. It's very unique, and it's not something that we often hear in the US market where we're kind of in our own bubble, so really appreciate your sharing that with us today. Thank you again.
Alessandra Bruni: 29:09 Yeah, thank you. I appreciate the chance you gave me to talk about China and this incredible event and on the Chinese point of view.
Allison Hartsoe: 29:16 Good, remember everyone when you use your data effectively, you can build customer equity. It's not magic. It's just a very specific journey that you can follow to get results. Thank you for joining today's show. This is your host, Allison Hartsoe, and I have two gifts for you. First, I've written a guide for the customer centric Cmo, which contains some of the best ideas from this podcast, and you can receive it right now. Simply text, ambitiondata, one word to, three, one, nine, nine, six, (31996) and after you get that white paper, you'll have the option for the second gift, which is to receive The Signal. Once a month. I put together a list of three to five things I've seen that represent customer equity signal not noise, and believe me, there's a lot of noise out there. Things I include could be smart tools. I've run across, articles I've shared cool statistics, or people and companies I think are making amazing progress as they build customer equity. I hope you enjoy the CMO guide and The Signal. See you next week on the Customer Equity Accelerator.