On 6 December, Alibaba announced personnel changes at the top.

Trudy Dai will lead the e-commerce group (including Taobao, Tmall and Alimama), the B2C retail group, Tao Cai Cai, Taote and 1688, which together form the “China Digital Commerce” unit.

At the same time, Jiang Fan will be in charge of two overseas businesses – AliExpress and ICBU (International Core Business Unit), as well as a number of overseas subsidiaries such as Lazada, which together form the “Overseas Digital Commerce” unit.

Jiang Fan, who is 36 years old, was previously President of Taobao and Tmall, undoubtedly one of the most prominent rising stars within Alibaba Group, until he was hit by an affairs scandal and had to be demoted. 

Following are some of our comments on the new “Overseas Digital Commerce”:

  1. Alibaba’s overseas business, especially the ecommerce business, is actually not quite smooth these years: Especially after 2019, Lazada has been under tremendous pressure from Shopee in Southeast Asia; Recently, Shopee has expanded into Brazil, Poland, France and other key markets that AliExpress has been covering, posing a direct threat to the latter; Trendyol has done relatively well in Turkey, while the market share and performance for Daraz in South Asia is still uncertain and need to be tested.
  2. In fact, the overseas e-commerce of Alibaba would have been able to grow comfortably  at its own pace if not for aggressive competitors like Shopee. After all, Alibaba has a proven experience and deep understanding of ecommerce with outstanding capabilities for product management, technology and operations, which are unmatched by any emerging market competitor.
  3. A lot of people doing overseas business for Alibaba are actually feeling unhappy with the fast growth of their rivals who are not as experienced as Alibaba in technology, product, and operations.
  4. It’s been realized the core of the overseas business is mainly about organisation, people and leadership: Shopee has been able to grow rapidly partially because it does not have the burden of a huge home  market and problems from organisational inertia (which of course may come later).
  5. Aligning the overseas business and putting a capable core at the helm are correct and wise moves. However, the challenges facing Jiang Fan are daunting: make correct decisions, appoint the right people and efficiently execute the ideas in every market.
  6. When people have little expectation of what can be achieved, you can actually do more because you do not have the burden. Some of Ant Group’s experiences, and many case studies in history, have proven that. 
  7. Finally, we wish Jiang Fan and Alibaba a good success. The market needs a reinvigorated Alibaba. 

Thanks for reading The Low Down (TLD), the blog by the team at Momentum Works. Got a different perspective or have a burning opinion to share? Let us know at [email protected].