Jack Ma of Alibaba made a recent splash by his visit to the US, and more Chinese companies want to follow in his footsteps. Joel Backaler, author of China Goes West: Everything You Need to Know About Chinese Companies Going Global explains in Forbes the rules to be learned from Alibaba.
Jack Ma, chairman of Chinese e-commerce giant Alibaba, recently returned to the city where his firm made history last year with its record-breaking $25 billion IPO. First in New York and then in Chicago, Ma emphasized the importance of ‘cross-border e-commerce’. This relatively new form of e-commerce enables Chinese consumers to purchase products directly from the US and other international markets via Alibaba’s TMall Global online platform. This booming industry is expected to grow from $40 billion in 2014 to as large as $240 billion by 2020. There’s a huge market up for grabs, and competition is intensifying – NASDAQ-listed JD.com recently launched its similar JD Worldwide, while other ‘pure cross-border’ companies like Shanghai-based Ymatou.com are quickly gaining ground.
Ma’s high-profile US visit had two goals. First, it enabled him to promote cross-border e-commerce and explain how American businesses can capitalize on the emerging phenomenon to sell their products to Chinese consumers. Second, it provided him a platform to address mounting concerns about counterfeit products being sold on Alibaba’s sites. Ma’s fluent English and ability to navigate complex and sensitive topics are key assets that have enabled him to connect with Western audiences. However, there are three more important lessons that Chinese CEOs who wish to ‘go global’ can learn from Jack Ma and Alibaba.
Lesson #1: Be Visible
Chinese companies, especially in traditional business-to-business sectors, have often built success through a relentless focus on short-term sales. Given the size of the Chinese market and rapid pace of economic growth, their firms often grew without extensive focus on activities like marketing, branding and public relations. Yet these three capabilities are critical for Chinese firms expanding overseas in order to proactively build and manage their international reputations.
Alibaba’s successful example demonstrates how important it is for Chinese CEOs to personally invest in spending time with overseas governments, trade associations and media to shape perceptions, rather than appearing only during times of crisis. During Alibaba’s high-profile IPO roadshow, Jack Ma traveled to 10 different cities around the world serving as the face of Alibaba. He accepted interviews and guest spots with nearly every major international business media outlet. His firm produced high-quality videos, articles, and a wide variety of online and offline content positioning the firm as a global company with a track record that is comparable to other more established multinational firms.
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