Alipay Bridges North American Merchants to Chinese Consumers Seeking Overseas Goods
This week, Souheil Badran, president of Alipay North America, participated in Money 20/20 in Las Vegas, presenting how the company’s mobile payment platform is helping more than 100 million Chinese tourists all over the world easily find and use local services in the Alipay app during their travels, while opening new revenue opportunities for merchants.
With Chinese consumers traveling more than ever, there is a unique opportunity to bridge these consumers — who seek a familiar, frictionless payment wherever they go — to merchants who can provide them with products they can’t find in China. According to the World Tourism Organization, the Chinese tourism market is estimated at more than $164 billion and Chinese consumers are the largest spenders worldwide. The number of Chinese consumers visiting North America is predicted to grow to four million this year, with the Chinese middle class being the fastest-growing online consumer market in the world, slated to reach 600 million by 2022.
This makes Chinese travelers a lucrative audience for North American merchants. However, the language and payment barriers can often stand in the way, making it difficult for Chinese travelers to shop, locate restaurants, buy tickets and more. Even online shopping can prove to be difficult because of currency conversion barriers.
Nonetheless, Chinese consumers continue to seek out overseas goods. During Badran’s presentation, “Alipay: From Payment to Lifestyle, From China to Global,” he noted that Chinese consumers are shopping for overseas products most often because they are cheaper than in China (76.2%), they can’t buy the product in China (70.6%), and they are authentic products (65.9%).
As the preferred payment method for 520 million consumers in China who consider Alipay a critical lifestyle app, Badran noted they saw an opportunity to expand in North America.
“The approach we’ve taken is through partnerships,” he said during his standing-room-only keynote presentation Sunday afternoon. Several partnerships were announced ahead of the Money 2020 conference including NAB, Marqeta, Verifone and Poynt. The company’s aggressive partnership strategy has already resulted in the addition of hundreds-of-thousands of acceptance points for Alipay in North America. Badran expects this momentum with partnerships to continue as Alipay expands its merchant acceptance footprint in the U.S. pointing to the Alipay app’s geolocation-based “Discover” function which enables consumers to receive promotions from local merchants via push notifications.
Badran also noted the key to the company’s success has been that Alipay is so much more than a mobile wallet, it is a valued part of the Chinese consumer’s everyday life as well as a key part of their travel plans. Alipay users engage with the app 14 to 15 times a day. Users can not only hail taxis, rent bikes and manage their money market fund all within the app, but users can also book flights and hotels through the online travel platform, Fliggy, within the Alipay app. On average, Chinese consumers start planning their trips about 57 days in advance of travel and can find a wealth of information that guides their travel decisions and allows them to prepay for their experiences, all within Alipay.
The bottom line as Badran noted is that Alipay connects Chinese consumers with North American merchants pre-trip, mid-trip and post-trip. Alipay offers directions, coupons and offers in Chinese, and also facilitates an integrated tax refund post-trip.
By creating a lifestyle platform centered on the needs of tech savvy Chinese consumers and one that also facilitates payments, Alipay is transcending country, currency and language barriers. Expanding partnerships in North America that enable merchants to accept Alipay at checkout both instore or online creates a positive experience for Chinese consumers and offers new revenue opportunities for merchants and partners. Alipay is the superhighway for North American merchants to unlock the China opportunity