Alibaba opens ecommerce door for Chinese villagers

February 16, 2014 1:16 pm

Alibaba opens ecommerce door for Chinese villagers

By Ben Marino in Donggaozhuang

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The posters plastered on walls in the isolated village of Donggaozhuang, in China’s northeastern Hebei province, do not extol the usual communist ideals of social harmony or party loyalty.

Instead, they promise to reveal the secret to becoming an ecommerce millionaire and to help the town’s residents “reach your dreams of fortune”.

Donggaozhuang is just one of a dozen of so-called ‘Taobao villages’ across China – rural townships transformed by the possibility of reaching millions of potential customers with the click of a mouse, often on Taobao, the Alibaba-owned site.

“You don’t need to go anywhere, all you need is a computer and a network cable, you can search all the customers in the whole country,” says Liu Yuguo, a resident of the village and the owner of a growing online cashmere store.

Instead of enduring a life of back-breaking work in fields for a meagre monthly income, or choosing to become migrant workers in far away coastal areas, peasants and their families in Donggaozhuang are opening online businesses selling Inner Mongolian cashmere to fashion-conscious internet shoppers.

At the centre of this transformation is Alibaba, the Hangzhou-based company that controls 80 per cent of ecommerce in China and is set to be valued at more than $100bn when it becomes publicly listed later this year.

On Alibaba’s ecommerce sites alone, the number of online stores from rural areas has increased by nearly 50 per cent since 2012, to more than 1m. Seven out of 10 areas in China where online shopping is growing fastest are in rural, less developed parts of the country, according to Alibaba.

In Donggaozhuang, some villagers have taken this opportunity even further, by hosting online masterclasses for others wanting cash in on China’s ecommerce boom.

For Mr Liu, the decision to open an online store in 2007 was an easy one, after various failed attempts to start more traditional businesses.

Sitting in his warehouse where 30 of his young employees are rushing to pack orders and reply to customers, the 35-year-old former farmer describes the advantages of ecommerce.

“There’s basically no expense – no expense in advertising, no expense in employment, the owner can do all of it himself, at most with his wife,” he says.

Mr Liu’s stock was sold out within days of setting up his virtual stall for cashmere yarns on Taobao. His online shop, called “Ku mei jiao” or “Cool, pretty and alluring” has now served 470,000 customers, and the BMW-driving Mr Liu is expanding by buying his own spinning machines, with plans to start making his own range of sweaters.

“I would never have this business offline even if I worked my whole life for it,” he says.