Taobao boosts rural e-commerce

Company's program helps people in countryside to access goods, services

Almost half of China's 1.3 billion population still live in rural areas. While incomes are growing, some rural residents still lack the employment opportunities and everyday products and services that city dwellers take for granted.

That is what Alibaba Group Holdings Ltd sees as a huge unmet need. Through an initiative called the Rural Taobao program, the e-commerce titan is helping to raise living standards in China's countryside by providing e-commerce access to millions of the nations' poorer residents. Taobao is the customer-to-customer online marketplace owned by Alibaba.

With an estimated investment of $1.6 billion since 2014, the company has established thousands of Taobao Rural Service Centers across China, enabling villagers with little or no access to the internet to order and receive goods which so far have been inaccessible to them.

Gong Jianfei, who runs one such service center in Lin'an county in Zhejiang province, is helping local villagers source needed items online with better quality and lower prices. She places 40 to 50 orders a day on behalf of the buyers and asks them to collect when the parcels arrived at the center in a couple of days.

Gong said: "E-commerce is helping them join the digital economy, and some of them even start their own businesses online."

The program has gone into partnership with local governments to provide free access to computers. Alibaba also offers training to villagers on internet searches and the completion of online payments.

According to company data, the top-three best-selling items sold through the service centers are home appliances, mobile top-ups and women's clothing.

By June 2016, the gross merchandise value of e-commerce in rural China reached 316 billion yuan ($46 billion), accounting for nearly 15 percent of all e-commerce transactions nationwide, according to a joint study by Southwest University of Finance and Economics and Ali Research, an Alibaba think tank.

Apart from traditional services, Alibaba is also extending into new tech such as big data to empower villagers to identify the right produce to sell to customers.

Wang Xiaoer's march into online sales stemmed from a request by his father-in-law, a farmer in Shandong province whose apples were not selling too well in 2012. So, Wang opened an online store on Taobao and expanded the product portfolio from just apples to include pears, cherries, avocados and mangoes.

But the real secret to the business was leveraging big data analysis provided by Alibaba, which helps the vendor analyze customer preferences and decide which fruit sells better and in which time period.

Wang said: "Without big data, we used to be clueless in selling. Now we don't worry about the potential waste."

Wang quit his job as a software developer last year to focus on the fruit business.

More than 10,000 individual farms are now tied up with Wang in the hope that e-commerce and precise data analysis could boost sales and help them sell their local specialties globally.

Also turning to high-tech are villagers in Youxi county, Fujian province, who have harnessed live-streaming and the Taobao platform to market kumquats. At the end of November, the county had 132 e-commerce firms employing 2,360 people.

Taobao also promoted the local produce by inviting a Michelin star Italian chef and a Chinese internet celebrity to visit the area on a tour and they put on a cooking demonstration which was streamed live.

"People are normally concerned about food safety when they purchase food online. We want to show them the source of the produce," said Wang Xiuli, a Rural Taobao staff member overseeing the project.

hewei@chinadaily.com.cn