📦 Taobao Launches Major Promotion
Alibaba Group has allocated 1 billion yuan (US$142M) to support a new campaign for Taobao users in Hong Kong. Starting this October, the promotion will waive delivery fees for orders over 99 yuan (US$14) across popular categories such as fashion accessories, electronics, skincare, and cosmetics. This campaign will last through the fourth quarter, a peak sales period for Alibaba. The goal is to enhance customer experience in Hong Kong, one of Alibaba's key markets outside mainland China.
📈 Competition in Hong Kong’s E-commerce
Alibaba's move comes amid increased competition from other Chinese e-commerce giants in Hong Kong. Pinduoduo, managed by PDD Holdings, started offering tailored delivery and payment options for Hong Kong consumers in 2022. Meituan, another Chinese giant, saw its Keeta app become the largest food-delivery platform in the city in Q1 2024. Alibaba’s new campaign is a strategic effort to solidify its position against these rivals.
💬 Statements from Alibaba Executives
At the campaign's launch event, Ye Jianqiu, General Manager of Tmall Taobao World, emphasized the importance of Hong Kong to Alibaba's international strategy. "Hong Kong has always been one of the most important markets for Alibaba," Ye said. C.K. Chan, head of Hong Kong and Macau operations, noted that the promotion aims to improve customer satisfaction rather than hitting specific revenue targets.
💼 Financial Context
Alibaba's revenue for the June quarter increased by 4% to 243.2 billion yuan (US$33.4B), a slowdown compared to the previous quarter's 7% growth. The company’s profit dropped 29% to 24.3 billion yuan (US$3.3B), missing analysts' expectations of 30.4 billion yuan (US$4.2B). The company is navigating an economic slowdown on the mainland while boosting its international operations, including this significant investment in Hong Kong.
Will Alibaba's delivery fee waiver outpace its rivals?
