In its evolution from online payment platform to lifestyle app, Alipay sees nothing but opportunity in China’s nascent love affair with Australian brands.
The growing demand for Australian-made goods from Chinese consumers is fuelling
the expansion of Alipay, a mobile payments platform. Likened to a Chinese version of PayPal, Alipay is China’s leading third-party payment platform and is also used in 24 other countries. Alipay opened its Sydney office in 2014.
Two years later, Alipay Australia is on a mission to recruit more small-to-medium enterprises to meet China’s love of quality Australian products. The most popular Aussie goods purchased by Chinese consumers are food and beverages, nutritional supplements, mother and baby products, organic products and natural cosmetics. Chinese consumers who are increasingly leaning towards natural, organic products, perceive Australian goods to be clean and green.
At home and abroad
This strengthening demand for Australian brands is at the heart of Alipay’s foray into Australia. The company also aims to cater to Chinese travellers in Australia, the company’s Senior Manager of Corporate Affairs, Miranda Shek, says.
“We are targeting Chinese who travel in Australia and Chinese consumers who shop online at Australian sites like Pharmacy Online and Chemist Direct,” Shek says. “Alipay has evolved into a lifestyle app and we would like to provide the same kind of experience for Chinese people when they are travelling overseas.”
Australia in the top 5
To secure more Australian businesses and merchants and give them access to Alipay’s cross-border payment solutions, the company will team up with its joint-venture partner, Paybang.
Shek says Alipay representatives began to approach offline merchants in late 2015.
“In the future, we are looking to work with more local partners in providing a similar experience to local users,” she says.
Alipay’s 2014 launch in Australia came after the company’s statistics revealed just how popular Australian products are: Australia is the fifth most sought after market for online products by Chinese buyers using Alipay.
Popular way to pay
More than 60 per cent of Alipay’s transactions are carried out on mobile devices, but Shek says the company is strengthening its offline presence. “In addition to online payment functions such as online shopping payments, money transfer and utility bill payments, Alipay is expanding to offline payments both inside and outside of China,” Shek says.
“Over 600,000 brick-and-mortar merchants and over a million taxis now accept Alipay
as a payment method across China.”
With more than 450 million registered users, 190 million of them active, Alipay is taking the world by storm. As part of the company’s aggressive expansion plans, it has just launched in Europe.
Alipay’s technology has evolved from a digital wallet to a “lifestyle enabler”, Shek says. “Users can hail a taxi, book a hotel or buy movie tickets directly from various modules within the app and purchase wealth-management products such as Yu’e Bao.”
Biggest IPO ever
Alipay is operated by Ant Financial, an offshoot of e-commerce giant Alibaba, which was founded in 1999 by Chinese tech entrepreneur and now billionaire, Jack Ma. Ma’s fortune is largely attributable to Alibaba’s most popular online marketplaces Taobao Marketplace and Tmall.com.
Ma has announced plans to bring Alipay to the Chinese stockmarket this year, in what is speculated to be China’s biggest initial public offering since 2010. The IPO will be keenly watched after Alibaba’s listing on the New York Stock Exchange claimed the record as the world’s largest IPO in 2014.
Alipay’s debut in Australia was timed well. In the same year the company opened the doors of its Sydney office, the Australian and Chinese governments signed off on a historic free trade agreement. The agreement, which came into force from December 2015, means more than 85 per cent of Australian goods exported to China will enter duty free. It was a boon to Aussie exporters who will collectively save millions in tariff payments.
Opportunity for Aussie retailers
The China-Australia Free Trade agreement also gave consumers access to Tmall.com and Taobao Marketplace. It also offered small-to-medium enterprises a chance to expand their markets thanks to China’s population of almost 1.4 billion people.
trading partner, according to the Department of Foreign Affairs and Trade. In 2014, Australia’s trade in goods and services with China reached $152.5 billion up from $125.7 billion in 2012.
In the same year of Alipay Australia’s launch, Australia Post agreed to stock, sell and distribute prepaid Alipay purchase cards by June this year. The cards will enable local customers to purchase goods from Tmall.com and Taobao Marketplace.
A growing range of Aussie brands are signing up to sell at both Tmall.com and Taobao Marketplace, including big names such as wine label Penfolds, clothing store Jeans West, baby food manufacturer Bellamy’s Organic and A2 Milk. Small businesses are also eager to jump on board. Sydney’s Olive Oil Skin Care Co and Melbourne beauty subscription service Bellabox
have set up shop in Australia Post’s Tmall store.
Shek says Alipay has no current plans to open further offices in Australia. If the company’s phenomenal growth overseas is anything to go by, Australia could soon be welcoming more Alipay locations.
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