Chinese technology giant Alibaba is silently testing waters in India’s mobile e-commerce market to tap the South Asian nation’s half a billion smartphone users.
Alibaba has so far invested in Indian startups like payment services company Paytm and its e-commerce arm Paytm Mall, online marketplace Snapdeal, food delivery startup Zomato, online grocery unicorn Bigbasket, and logistics company Xpressbees. While Indian users could access its B2B trading marketplace Alibaba.com, and its cross-border B2C commerce app Aliexpress, it didn’t have a direct marketplace entity in the country. However, local media Entrackr reported Thursday that Alibaba has been running Yoli, its mobile e-commerce app, for about eight months in the country.
As of now, it is an affiliate platform flashing deals from e-commerce companies such as Amazon, Flipkart, Snapdeal, Myntra, Nykaa, Paytm Mall, and Purplle, among others.
“Currently, the app is similar to other affiliates sites. However, it will turn into a video-centric affiliate,” one of the sources told Entrackr, adding Alibaba is in talks with production houses to ramp up the infrastructure for video.
The app will be similar to video commerce apps like Bulbul and SimSim, the sources told Entrackr. Videos will have a buy button, which when clicked would redirect users to the sellers’ platform. Yoli, according to the report, is likely to become a video-only affiliate site by June-July.
Alibaba has been trying to tap into India’s rapidly growing mobile-first users. Last year in May, it pumped USD 100 million into Vmate, a three-and-a-half-year-old social video app, owned by its subsidiary UC Web. Vmate allows users to share short videos, do live-streaming, and download videos. Now it is aiming to grab India’s thriving mobile commerce market.
According to Shraeyansh Thakur, vice president of Sequoia Capital India, the country’s social e-commerce market will grow similar to how it grew in China.
“Social commerce in China has grown rapidly over the last few years and now accounts for over 15% of online retail sales in China, growing 2x the rate of the overall online retail sector,” he wrote in a blog post. “We think social commerce will track a similar trajectory in India and could account for 15% to 20% of online retail in India in the next 10 years, creating a market worth USD 70 billion (more than 2x the size of the current e-commerce market in India).”
Last year, India witnessed a growing tribe of social e-commerce platform that lured in global investors. In November 2019, video e-commerce app SimSim raised USD 6 million in a Series A funding round led by Accel and China-based venture capital firm Shunwei Capital. Just a month before that, social e-commerce venture, HappyShappy had raised an undisclosed amount of seed funding from a slew of high-profile investors including Beerud Sheth, Samuel Choi, Shivashish Chatterjee, and Yuvraja C Singh.
Social e-commerce startup Meesho bagged USD 125 million in August 2019 in a Series D round led by South African tech conglomerate Naspers. Rising with its contemporaries Meesho, SimSim, and HapyShappy is Bulbul, a live-streaming e-commerce platform, which was picked up amongst others by Sequoia Capital India for its Surge accelerator program held in April 2019. Similarly, rival EkAnek secured about USD 10 million seed round from Sequoia Capital, Lightspeed Ventures, and Matrix Partners in March 2019.