China’s largest e-commerce company is making its first appearance in the US with the debut of 11Main.com, an invite-only online marketplace that showcases small business retailers.
Industry watchers will be paying close attention because 11 Main is owned by Alibaba Group Holding Ltd (阿里巴巴), the e-commerce giant in China that filed for an initial public offering in the US last month. Bigger than Amazon and eBay combined, Alibaba had no US e-commerce presence until now.
Forrester analyst Sucharita Mulpuru believes Alibaba will not find it easy to break into the crowded US online shopping industry.
“US e-commerce is crowded and relies on high marketing expenses to rise above the clutter,” Mulpuru said. “The hope is high. We’ll see if they live up to expectations.”
For now, Alibaba is starting small with 11 Main, based in San Mateo, California. The site, which debuted on Wednesday in a beta phase, will feature “hundreds of thousands” of products from 1,000 to 2,000 upscale specialty shops and boutiques around the country that were vetted by the company.
The 15-year-old company has navigated technical and financial challenges, and a battle with eBay Inc, to become the world’s biggest online bazaar and is now planning to sell stock in the US. Analysts say its initial public offering — planned for later this year — could raise up to US$20 billion.
The 11 Main site’s layout is clutter-free and without ads, similar to social-media sharing site Pinterest. Shoppers can browse or search by category or retailer. The site features video profiles of some of the small businesses along with its products, to give users a sense of what the stores and their owners are like.
Forrester analyst Kelland Willis said Alibaba’s strategy with 11 Main is to try to offer the Amazon or eBay shopper a different type of online shopping experience, giving each vendor its own identity on the site and offering a more curated shopping experience.
That is what Alibaba’s hugely successful sites offer in China, Willis said.
“They’re trying to come in to the US market and compete using that,” Willis said.
Without ads or retailer fees, 11 Main plans to generate revenue by taking a 3.5 percent cut of each transaction. In return, retailers get 11 Main’s national marketing power and reach.
“We want the shops to represent the diversity of Main Street. Some shops are high-end boutiques and some are more vintage,” 11 Main president and general manager Mike Effle said.
The company’s name is intended to evoke bringing Main Street online and the the “11” in its name is meant to represent the “one-to-one” relationship that customers and merchants have on the site, the company said.
The site was going to begin as invitation-only when it launched on Wednesday. Consumers can request an invitation at 11main.com.
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