The Alibaba and Canada Lovefest

Vicky Xiao

“Jack Ma? Oh, I know, he’s that super rich guy!” Mention Jack Ma, and now even Toronto’s cab drivers will recognize his name, perhaps even knowing that before he founded Alibaba he was an English teacher.

“He’s like a movie star!” When Ma came on stage at the company’s Gateway 2017 event in Toronto, promoting business and partnership in Canada, the crowd erupted in applause, one person next to me even screaming like a fan at a concert. Even here, far from China, Ma is no stranger, and just like with any charismatic business leader, they talk about his wealth and his success story.

But today, in Canada’s largest city, Ma is officially hitting it big. Before an audience of some 3000 small business owners, he launched into one of his typically inspiring talks. He sat opposite Canadian Prime Minister Justin Trudeau and joked with him. And when he announced that Alibaba will be taking Canada’s lobster, spirits, maple syrup, and health products to the tables of China’s soon to be 500 million strong middle class, the crowd rose to a standing ovation—Trudeau among them.

This is not the first time that Alibaba has held such an event in North America. In June it held a similarly titled conference in Detroit, inviting the 300 million plus population of the US and the many business owners among them to take their products across the Pacific. This time, though, in Canada, which has roughly only a tenth of the population, Ma was still able to attract an equally large and eager crowd.

Ma said that initially Alibaba had thought they might only be able to entice 500 people to attend. Of those who showed up, 68% were from companies with 50 or fewer employees, but they were from all across the board: manufacturing, retail, professional services, agriculture, tourism, and more. In the manufacturing segment, 73% of the companies still have no business with China; they showed up because they hope to change that.

Ma’s lure for them is of course China’s huge and still burgeoning middle class, expected to surpass half a billion people within the next five years. That is more than the population of Canada and the US combined, and will be the largest middle class population in the world. What they want is clear: the best products from around the world. And on that wishlist is many of the things that Canada is known for, from maple syrup to 850 RMB Lululemon yoga pants and 2000 RMB Arc’teryx backpacks.

In fact, Canadians have already witnessed the frenzy Chinese shoppers are capable of. Some 500 Canadian brands are now on Taobao and Tmall. Arc’teryx, for instance, saw its sales boom by 80% once it listed on Tmall, with China becoming its fastest growing market. The founder of health goods company Viva said that, since launching on Tmall in April, their sales have doubled each month.

But what do Chinese consumers love most from Canada? Simple, fresh food, especially seafood, along with blueberries. Skincare products, health goods, and baby products also sell well.

“We are striving to optimize our supply chain, and push for more open policy in the hope that in ten years’ time everyone will be able to freely enjoy high quality goods from all over the world, delivered within 72 hours,” Ma told us.

He repeatedly called out to the audience at the event, invoking the excitement of “consumer upgrades.” Last year, he said, China had already become the largest online retail market. By next year, it is expected to be larger than the online markets of all other countries combined.

He rattled off a series of figures: 1.4 billion people in China, 800 million online, 500 million of whom are shopping. Middle class consumers, overseas travellers, daily shipping volumes, and so much else, all measured in the tens or even hundreds of millions.

Over the last 50 years, the US has generally been Canada’s largest market, but, Ma told the audience, “Now, it is time to look east.”

Those at the conference were also looking at another benefit of all this trade, outside of ecommerce: tourism. As Ma noted, the average tourist paying a visit to one of Canada’s wineries might spend 30-100 CAD, but for Chinese tourists, that number shoots up to 1000 CAD or higher. As a result, over 600 Canadian businesses have already started to accept Alipay.

And here, Canada’s government is lending a hand. Last September, Prime Minister Trudeau attended the G20 summit in Hangzhou, which of course happens to be the location of Alibaba’s headquarters, and there he met with Ma at to launch Canada’s official Tmall site. Now, as Ma was paying a visit to Canada, Trudeau not only showed up, but joined Ma on stage for a fireside chat.

Of course, Ma and Alibaba have interests of their own, and Ma expressed a hope that Canada might make use of Alipay’s social credit system in processing visa applications from China. At that point, Trudeau turned to the audience and said, smiling, “For the record, that’s not the first time Jack’s made that pitch for me.”

So just possibly, there could still be some hope in the future for Chinese tourists to make their way to Canada and buy all the maple syrup they want.