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  1. E-commerce platforms originating from China, such as Alibaba Express and Temu, are experiencing rapid growth. In the Korean e-commerce industry, there's speculation that Alibaba Express might have reached the third spot, following Coupang and Naver. Even Temu, which entered the Korean market slightly later than Alibaba Express, has significantly closed the gap in Monthly Active Users (MAU) with Alibaba Express to just 1 million. How is the domestic e-commerce and logistics industry responding to this foreign incursion?
  2. Recently, there has been talk in the logistics industry about Alibaba Express inquiring into detailed conditions for operating a domestic logistics center. Last year, Lei Zhang, the representative of Alibaba Express in Korea, mentioned that operating a domestic logistics center was worth considering. Why would Alibaba Express be interested in operating a logistics center in Korea? We've compiled four benefits Alibaba Express could gain from operating a logistics center in Korea, based on discussions with current e-commerce and logistics industry practitioners.
  3. There is one method to secure all four mentioned benefits at once: Alibaba Express acquiring 11st. While there are considerations regarding valuation, the industry widely accepts that 11st is keen on selling itself. If Alibaba Express becomes the acquirer, the synergy could be greater than expected, according to forecasts in the e-commerce sector.
  4. One might wonder why Temu, which has grown as rapidly as Alibaba Express, has not been heard to be entering the domestic logistics center market. The difference in the e-commerce business operation structure and the merchant onboarding process between Alibaba Express and Temu provides an answer. We've heard from global sellers who have stores on both Alibaba Express and Temu about these differences.

Alibaba's Interest in Korea: Targeting Warehouses?

One of the hottest topics in the Korean e-commerce ecosystem recently revolves around the Chinese cross-border e-commerce platforms Alibaba Express and Temu surpassing 10 million Monthly Active Users (MAU). According to IGAWorks, as of January 2024, Alibaba Express and Temu's MAUs were reported at 5.61 million and 4.59 million, respectively. Continuing from last year, the number of new installations for these platforms remains the highest in the domestic shopping sector, showcasing their steep growth trajectory.

In the e-commerce industry, there's speculation that Alibaba Express has already surpassed 11st and Gmarket to become the third largest commerce app in Korea. Given that Alibaba Express has declared this year as the "first year of localization in Korea," it seems increasingly likely that the position of the third-largest e-commerce platform in the country will inevitably be handed over to a Chinese platform.