Alibaba (BABA) Promotional Campaign to Expand Global Reach – May 31, 2024

Alibaba‘S (WOMAN – Free Report) international e-commerce arm AliExpress has announced several promotional campaigns for buyers after being named the exclusive global e-commerce partner of UEFA EURO 2024.

The company announced that 1,000 buyers will have the chance to win tickets to UEFA EURO 2024 matches.

Promotional campaigns also include Selection Day and the “Summer Carnival” Summer Sale, a “Shake & Win” game with limited-time prizes, and a fun quiz where users can win discounts, game tickets and discount coupons worth up to $500 each.

With this announcement, Alibaba aims to improve the user experience for its consumers around the world. This, in turn, is expected to drive solid customer growth on the AliExpress platform among international customers and sports enthusiasts, thus expanding its global reach.

Strength in international e-commerce business helps you grow

These promotional campaigns bode well for the company’s ongoing efforts to strengthen its international e-commerce business.

In the fourth quarter of fiscal year 2024, Trendyol expanded its cross-border operations in the Gulf region. Alibaba’s increased investments to improve customer experience by expanding merchandise categories, as well as ensuring fast and reliable delivery have played a key catalyst for Alibaba’s expansion in the Gulf. As a result, Trendyol became one of the most downloaded e-commerce applications in the Gulf region this quarter.

Alibaba’s growing initiatives to provide price competitiveness and fast delivery speeds to AliExpress Choice customers have further strengthened its international trade business. The company has created synergy between AliExpress and Cainiao’s cross-border logistics operations to strengthen AliExpress’s 5- and 10-day delivery services. It has also increased investments in key markets to improve the customer experience, expand its consumer base and strengthen its market position globally.

These efforts will continue to help Alibaba expand its international e-commerce footprint. This, in turn, will strengthen the performance of Alibaba’s International Digital Commerce Group (AIDC) segment, which is currently a key growth driver for the company.

The AIDC segment, which includes Lazada, AliExpress, Trendyol, Alibaba.com and other companies operating in international retail and wholesale markets, generated revenue of RMB 27.45 billion ($3.8 billion), showing year-on-year growth of 45%. .

The strengthening AIDC segment is expected to help Alibaba’s overall financial performance in the near term.

The Zacks Consensus Estimate calls for total revenues in 2025 of $138.63 billion, up 6.2% year-over-year.

Increasing competition is hurting Alibaba

However, Alibaba faces stiff competition from industry players such as Amazon (AMZN – Free Report) i eBay (EBAY – Free report) on the global e-commerce market.

Competitive pressures combined with increasing expenses related to new initiatives, macroeconomic uncertainty and unfavorable currency fluctuations remain the main risks for the company. Year-to-date, shares of the company have added 2.7%, underperforming the Zacks Retail & Wholesale sector’s gain of 8.6%. The company’s stock also underperformed Amazon and eBay’s growth, which was up 18% and 23%, respectively, over the same period.

Amazon is a leader in the e-commerce market thanks to strong Prime momentum, solid distribution strength, growing fulfillment network and growing relationships with third-party sellers.

In turn, eBay is making a concerted effort to strengthen its position in the e-commerce space. It recently launched its mobile parcel concierge, Luxe Line, to provide a convenient sales experience, allowing visitors in Los Angeles and Las Vegas direct access to experts displaying and selling luxury items.

Zacks Rank and Stocks to Consider

BABA is currently sporting a Zacks Rank #3 (Hold).

A better-rated company is in the retail and wholesale sector Kupang (CPNG – Free Report), currently sporting a Zacks Rank #2 (Buy). You can see see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Coupang shares are up 73.2% year to date. CPNG’s current projected long-term earnings growth rate is 33.83%.

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