Alibaba on Choice: it’s still at an early stage in achieving its full potential
Alibaba Group is investing in its international network, particularly a service run by cross-border e-commerce marketplace AliExpress called Choice.
Choice has been expanding rapidly, gaining traction among consumers and merchants alike.
“The introduction of Choice represents a watershed moment for AliExpress,” said Gary Topp, European Commercial Director at AliExpress.
To understand why, look no further. We’ve done the legwork and compiled the ultimate guide to Choice.
Choice is a premium e-commerce service underpinned by a slick supply chain. You can find it as a tab on the AliExpress homepage or at the front of its app.
To understand how Choice is different, let’s take a look at how traditional e-commerce models work.
In a classic approach, third-party (3P) merchants sell products on a marketplace. They’re 100% responsible for logistics and customer service. In another, called a consignment or 1P model, the platform sells the products for the merchant, acting as the retailer while the merchant is its wholesale supplier.
Choice is a hybrid of the two, combining the infrastructure of the AliExpress marketplace and Alibaba Group-wide capabilities, with upgraded services, to create a “fully-entrusted” business model.
Why is this an upgrade? Choice sources products straight from merchants and factories, shortening the supply chain so it can offer value for money to shoppers while taking care of customer acquisition, pricing, delivery and after-sales service.
It exercises greater control over product selection and quality control, attributes of the 1P model while offering the wide selection of stock-keeping units and scalability of the 3P model.
Business-to-consumer e-commerce platform AliExpress officially launched Choice on March 1, 2023. However, Choice didn’t just pop out of nowhere fully formed.
Choice sits on the AliExpress marketplace. It also has roots in Alibaba Group’s “Fulfilled by Cainiao”, a cross-border service on AliExpress and Tmall Global.
Management has said that given Choice is less than a year old, it’s still at an early stage in achieving its full potential, so as it scales, unit economics will improve.
