AliExpress Russia Joint Venture deal completed

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Alibaba’s AliExpress Russia has announced the deal to join forces with Mail.ru Group, MegaFon and the Russian Direct Investment Fund is signed off which will bring together ecommerce, social media and gaming platforms for the Russian consumers and give Russian SMEs greater access to both local and international markets.

AliExpress Russia launched in 2010 to bring a new selection of affordable products to consumers by giving them direct access to the China market. Alibaba later included access to its B2C marketplace Tmall via AliExpress as well. What the new platform will do is accelerate the ability of Russian SMEs to sell domestically and across the world.

“Alibaba remains focused on fulfilling our mission ‘to make it easy to do business anywhere.’ The AliExpress Russia JV is an important part of Alibaba’s globalization strategy, and a key step toward our long-term goal to help 10 million small businesses reach profitability and serve 2 billion customers worldwide.”
– Daniel Zhang, Executive Chairman and CEO, Alibaba Group

Russia’s Federal Antimonopoly Service cleared the JV to move forward last June. Now, AliExpress Russia JV is majority owned by Russian shareholders

In addition to blending social media and eccommerce, the joint venture will work to support Russia’s consumption upgrade by delivering a greater selection of high-quality products to the market. For Russian small and medium-sized enterprises, it’s a chance to tap a newly connected ecosystem in the domestic market while accessing over 600 million consumers using Alibaba’s platforms, including in China, Southeast Asia, Turkey, Europe and India.

Potentially the AliExpress Russia Joint Venture will increase competition for domestic online merchants as Russian SMEs start to sell in Europe, however the effect will be less drastic than the impact of Chinese sellers as the main UK marketplaces are still Amazon and eBay, with others dominant in the EU. Aliexpress is well known, but not yet a dominant marketplace for UK and European merchants.

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