Chinese Alibaba in the U.S. - Analyst Blog

The U.S. e-commerce market is heating up, with new competition from China-based Alibaba.com. Alibaba Group CEO Jack Ma recently announced that its new business-to-business (BTB) e-commerce platform is currently in the beta stage and could be expected to launch in the U.S. by the end of the year.

This seems to be a good time to launch the site since traffic may be expected to increase as a result of the holiday season. However, the company’s entry will no doubt increase competition for existing players such as Amazon.com (AMZN), eBay Inc. (EBAY) and Wal-Mart Stores Inc. (WMT).

Still, online retail is one of the few markets that are expected to continue growing this year. According to Forrester Research, non-travel ecommerce sales in the U.S. are expected to grow 11% in 2009, a slight slowdown from the 13% growth seen in 2008. One of the major reasons for the continued growth in this market is the ongoing shift from traditional retail channels to the online model. Forrester research estimates that Internet sales, which were 5% of total retail sales in 2008 will grow to 6% of total retail sales in 2009, to 8% in 2012.

The platform has been specially designed for international customers and may be expected to launch in other countries in the next few years. Ma expects to have 10 million small and medium business (SMB) customers by 2019.

He also expressed optimism about other countries, such as India (where Alibaba currently has around one million customers). The company is in advanced talks with several local parties regarding the formation of a joint venture in India that is expected to launch within the next few months.

Alibaba is also looking for Latin American partners that could help it overcome language barriers.

Yahoo! Inc. (YHOO) has a 39% stake in Alibaba Group, which owns Alibaba.com (the e-commerce portal), Taobao (China’s largest online auction site) and Alipay (an online payment service provider).