Alibaba Group President J.Michael Evans on how Australia fits into Alibaba's global strategy

I want to spend just a few minutes talking briefly about who we are, what we do, and what we're going to do here. First of all, many of you actually don't know that much about Alibaba, and I'll be very brief. We're an online e-commerce company; we also do payments and cloud services. We are primarily China-based. We hit sales last year of about 500 million US dollars. We deliver 33 million packages every day, including Sundays. And we aspire to be much bigger and much broader, since the bulk of that business today is done in China. I was hired by Jack last year after being on the board as an independent director. I didn't see that coming. Jack and I have known each other for almost 15 years. Jack said, 'Look, what I'd like you to do is to build what we have in China everywhere else in the world.' And I thought, 'Sounds very reasonable, get started on that right away.' And it's taken me a good 11 months to really figure out what does it really mean to build Alibaba in the rest of the world. What we settled on—and I say 'we' because the leadership of Alibaba now agree on it—is that we want to connect small businesses all over the world to two billion consumers. We have to decide which businesses, which markets, and which consumers in rich markets. To make this very straightforward, it occurred to us that five of the seven billion people in the world roughly live in Asia, so we should probably focus on the consumer side in the Asian countries like China, India, and Southeast Asia. And the best products in the world all come from the big developed markets in the world, which would of course include Australia, New Zealand, Korea, Japan, Europe, and the United States. So our strategy, which is fairly easy to remember, is all about connecting the businesses in the developed world with the consumers in the emerging world, on a belief that more and more of those consumers will enter the middle class in the next 10 to 20 years. And we know based on the data that we have and the experience we have every day on the Alibaba platform, consumers and markets outside of China want to buy exactly the same types of products that Chinese consumers want to buy. And what might that be? All the things that you make and produce in this country, and New Zealand, and Korea, and Japan, and the United States, and Europe. So as I come to Australia and New Zealand, I'm struck once again at the opportunity, the enthusiasm, the creativity, the warmth of the people, the sophistication of the business, the quality of the products, and the opportunity that exists here to connect Australian and New Zealand small businesses to the consumers who desperately want their products but haven't the time finding them. Now, of course, there are a large number of Chinese that have decided to move here and live here, with good reason. There's an even larger number of Chinese that come here each year as tourists, who are looking to spend money, buy products, take them home, and consume them while they're here. So our strategy in Australia—and this is what I've been reviewing with the premiers, the Prime Minister, lots and lots of companies, and the Australian Post Office—our strategy here has really four planks. First is to continue the work that we've been doing with merchants and retailers to connect them to the Chinese platform. Understanding is now most of them do that. It's China today, both the business development that we're doing in terms of our globalization strategy to build out our businesses in Southeast Asia and India is really providing a much broader consumer opportunity for these companies. We could probably do this without being here, but of course it's much better to be here and have people on the ground so that we can develop closer relationships and deal with issues on a day-to-day basis. But we really need to be here for the other three things that we want to do. The first of which is payments, which is our Alipay, which is an electronic app used by over 600 million people in China, and by Chinese consumers in this country to buy products off the Tmall platform. But we also want to provide an opportunity for merchants, hotels, restaurants, and small businesses in this country to be visited by Chinese tourists who unfortunately have short credit cards and loan cash, and would prefer to be able to use a mobile app to pay for everything they buy, where they stay, and restaurants they go to. So we're working on a trial basis today for that, but we see that as a very, very significant opportunity, and one which relates to the two other opportunities that we also want to pursue. Perhaps the biggest and most ambitious of which is our plans for small businesses in this country. There are more than two million small businesses in Australia. You all know that. We would like to take, as a start, hundreds of thousands of those small businesses, put them on a platform, and connect that platform to Chinese and Asian consumers. Why do we think that will work well? First of all, we already do it in China by taking Chinese businesses and connecting them to Russian consumers and Brazilian consumers, and we send 300,000 packages every day to Russia to satisfy their consumer needs. So we understand the logistics component, but we also understand the consumer desire to buy products from small businesses, which in China amounts to products that are being produced by non-branded companies. Many of the SMEs in this country are not brands, but they do produce great products at a terrific price, and they would benefit greatly from finding another expression of interest or demand for those products. But it's impossibly expensive and logistically complicated to approach those markets on their own. So our plan is to put them on the platform here, to develop the logistics capability to move their products, to connect them by the internet to the consumers of today and the future, and to let nature take its course. We think it's great for Australia, we think it's great for small businesses, it's a terrific opportunity for consumers. And Jack's vision—Jack Ma's vision—for Alibaba in the future is to have two billion consumers and tens of millions of small businesses. Most of those small businesses on our platform are coming from the developed markets of the world, and Australia and New Zealand are key, key priorities for us. The last business supports all the rest of the business, and that's our cloud business. When you say cloud computing, people get a little edgy. Governments and regulators start worrying about what's going to happen with the data. This is a business we need to develop slowly, but it's a necessary part of the overall ecosystem that we want to establish in your country. That ecosystem needs to be able to manage the data generated by SMEs so that they can use that data to also assist in analyzing and growing their business. This is something that we'll develop over the next three to four years, and you'll see it first in the form of data centers that are built in several different places. We'll work very closely with the government and regulators to make sure that we comply with all of the appropriate rules and regulations. The most important thing is it will support small businesses and be of great value and assistance to them as they grow, with both domestic consumption and international consumers buying their products. Sounds pretty simple, right? It's going to be a big undertaking, which means the 58 people that you see on our team today will almost certainly get bigger rather than smaller. I am sure we will open additional offices to accommodate that, to accommodate the placement of businesses and personnel in the most appropriate locations to service the clients. But we have as a vision: Australia is a huge part of our future, and I am extremely excited and honored to be able to be here today to tell you a little bit about it. I'm looking forward to being back regularly to talk to you about the progress that we're making. Someday, many of you may look back, as I hope I will, and say something started here.