AliExpress vs eBay: The Battle for Global Market Share

When it comes to the online retail industry, AliExpress, the Chinese retail giant, are providing serious competition to the market leaders on the other side of the world. SimilarWeb data shows that over a period of 3 years, AliExpress, utilized an aggressive online marketing strategy, and managed to surpass eBay in global desktop traffic.

The map below displays countries that sent more traffic to eBay (blue) vs AliExpress (orange). Clearly AliExpress’ digital strategy has been working to gain more worldwide market share and eBay as well as other retailers need to take notice.

AliExpress vs eBay: The Battle for Global Market Share
The turning point came in April 2015, when AliExpress crossed the 1.1 billion desktop visits benchmark. At the same time eBay (all geographic domains combined), dropped by 12% from the previous month to around 1 billion desktop visits. So what digital strategy was responsible for such a massive increase in AliExpress traffic?

By the end of 2013, Aliexpress’s major sources of traffic were direct and referral traffic. However, neither the brand nor their affiliate partnerships were strong enough to drive more value to the site. With the introduction of another traffic source by the end of Q1 2014, AliExpress’s digital strategy would turn into a learning session for other online goliaths that would like to gain quick market share.

So how did AliExpress manage to increase their worldwide desktop traffic by 366% from May 2014 to July 2015?

To answer this question, we need to dive into a much deeper traffic source analysis. SimilarWeb shows that with the implementation of an aggressive display ads strategy, traffic to aliexpress.com increased almost immediately. With this positive traffic trend, AliExpress continued to invest heavily in their display ad campaigns. As early as July 2014, display ads had become the leading traffic source, and between March 2014 and July 2015, display ads had driven around four billion visits to the site. In June 2015 alone, 430 million visits came via display ads campaigns.

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At this point, due to display ads, and their resulting effect on direct and referral traffic, AliExpress had more visits than eBay. Things were about to change in July 2015 when AliExpress turned its display ads strategy 180 degrees.

From August 2015, much less effort was invested into display ads which resulted in an immediate decrease in desktop traffic. Moreover, the drop in display ads numbers negatively affected other traffic sources such as direct and referral traffic.

You might have expected that the snowball effect on traffic sources, which resulted in a boost in direct and referral traffic would not have happened when AliExpress stopped its display ad strategy. One would presume that after achieving a certain brand awareness, we would still see steady traffic coming from direct and referral traffic. Yet, we observed that by dropping its digital ads strategy, other traffic sources did not maintain continuity. Not long after the change in their digital strategy, in October 2015, eBay reclaimed its former glory and surpassed AliExpress in total desktop traffic – the old status quo was restored.

traffic ebay v ali

Conversely, something positive happened to AliExpress desktop traffic after changing its display ads strategy. From October 2015, all engagement matrixes started to improve. The quality of the traffic increased significantly.

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Was the digital marketing strategy of AliExpress a success? The company’s desktop traffic has had a pretty rough rollercoaster ride over the past few years, so it is arguable whether the strategy was a success or not.
On the one hand, you could claim that without Display Ads, AliExpress was not driving enough desktop traffic to their site and were unable to compete with the rest of the digital retail world. Conversely, the quality of their traffic has since increased, and when comparing November 2013 to April 2016, direct traffic increased by almost 200%.

There are multiple ways to analyze and conclude these insights, yet it is certain that AliExpress, through a massive campaign of display ads, managed to change the balance of power among digital retailers and has forever changed the online retail map.

About the Author -

Yoav Oren is the General Manager for China at SimilarWeb, responsible for all operations, including data partnerships and sales. He is a graduate of Columbia University (BA) and Jiaotong University in Shanghai (MBA). Outside of work, Yoav is a martial arts enthusiast. He holds black belts in different styles, and is a certified teacher in three. He lives in Tel-Aviv with his wife and two children.

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