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Time for Amazon to move over? China's Alibaba takes on the world

Tapping into Chinese diaspora part of e-commerce giant's strategy for taking on Amazon and eBay

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Illustration: Lau Ka-kuen
Bloomberg

Using a combination of word of mouth and advertising, Alibaba is tapping the millions of Chinese outside its homeland - from Singapore to San Francisco - to accelerate global expansion.

The e-commerce giant, which this week meets potential investors for its initial public offering in the United States, is attracting people of Chinese heritage drawn by hard-to-find items on its Taobao Marketplace like pineapple cakes and motorbike brake pads, as well as bargain-basement prices.

"I buy everything on the platform because it's so cheap," said Sam Ng, a 33-year-old web designer in San Francisco who shops for car gadgets and Korean fashion on the website and learned about Taobao from friends.

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Alibaba's success - and the prospect of pulling off the largest IPO in US history - is built on its business in China, where the company dominates the fast-growing e-commerce industry. Chairman Jack Ma Yun is looking beyond his base, betting that Chinese abroad will help him reach a wider array of customers in Asia, Europe and the home turf of Amazon.com and eBay.
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"If Alibaba's strategy is to follow the Chinese diaspora, it's a smart strategy because you don't have to build a brand from scratch," said Niraj Dawar, a professor of marketing at the Ivey Business School in Canada. "To be a global player, they eventually have to serve markets that are non-Chinese."

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