Alibaba

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Not every month has a notable event, but February was a rare exception. As many of you know, Bill Walton made a trip to China late 2015 and networked into the executive team at Alibaba. (In case you forgot, Bill is our number 1 talent scout!)

Bill arranged a preliminary meeting for Nick and me in San Francisco. We made the trip, met the Alibaba executive team and had a good dialog about the California SAL scene. On the way out, the senior exec, Jim Wilkinson, said “if you have companies in your membership that would like to sell more in China, bring them up to the office sometime.”

“Sometime” was this month, February 10th. I invited a representative group of our members to come along: Jinx, SKLZ, VerifiR, Eagle Creek (VF) and Road Runner Sports made the trip. The mission was to see if Alibaba could facilitate members' efforts selling in China.

As many of you know, I have been sourcing in China for 20 plus years and actively selling into the Chinese retail high fashion footwear market for several years. I don’t think of myself as “China naïve” or as uniformed about the Chinese market, or Alibaba for that matter. Big mistake!

Here are a few notes from the meeting. The numbers are not typos!

  • The Alibaba.com is a Market Place for living. It is not a Yahoo or Google site. Imagine a single site that combines Amazon, PayPal, eBay, Google, Yahoo, Facebook, email, Twitter, Netflix, Yelp, Fed Ex, Kayak Travel and more.
  • China is more than 90% mobile device based. Last year 409 million people used the Alibaba website, almost all mobile based. They transacted on average 50 times per user…around 20 billion annual transactions.

Alibaba is an everyday life experience for more people in China than live in total in the U.S.A. The average day for these people is often centered around the site. They go there first to plot out their day…food shopping, restaurants, movies, brand buying, travel, navigation, etc.

  • Alibaba is a marketing monster. On China “Singles Day,” November 11, 2015, Alibaba sold $14.32 billion. That amounted to 1,640 transactions per second!  There are over 1.1 million people in the delivery process, moving 467 million packages per day.
  • Basically this makes the opportunity almost overwhelming. Imagine if you wanted to start selling in the U.S.A. just to reach around 100 million active users across all the disciplines…then multiply it times 4…mega challenge that will require a serious strategy and funding!

Now, it’s not easy to sell B to C , or B to B in China. It’s not perfect for every brand. There is risk of counterfeit, or channel conflict, or perhaps conflict with your brand’s distributor. It takes money (imagine SEO costs to access this many people). On the other hand, it's a huge opportunity.

SDSI is working on a model to facilitate access to China via Alibaba. I suspect it will take several months to get it done. Of course we will get the plan out to everyone as soon as we can.

It’s not often that a small business accelerator group like SDSI can bring a real opportunity to its members, certainly not of this scope. I am very anxious to see if we can help members who are interested to make the big step into this market!

bob

A welcome note from Bob Rief

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Hey, Welcome to SDSI... We don’t care how you got here, phone, email, website…welcome! San Diego Sport Innovators is the local business development group focused in on Sport, Active and Healthy Lifestyle companies. The sum of our members businesses are what’s commonly known as ‘the San Diego lifestyle.” Hike, bike, surf, kite, skate, fly, hit balls or catch them, swim-peddle and run, moto, desert, whatever, its why we live in San Diego and its why there is an SDSI.  If you run a company like this, or work in one, or want to work in one, or better yet, start one, San Diego is the place and we are here to help.

SDSI is a business development group that is focused on the SAL business, “Sport and Active Lifestyles.”  We are a membership organization comprised of Industry members and the Service providers that make the wheels go around. Our industry members range from very small sandal companies to very big companies like GoPro. Our service providers run the gamut as well, from small-business focused bookkeeping firms to multinational Law Firms, Banks and Investment Bankers. There are three classes of membership: Board of Directors, Advisory Board and General.  The fee structure is low. Each group meets no less than 4 times a year. Major events are attended by all.

And what do we do….?

We work non-stop on making San Diego the capital of the SAL Industry. Just as Boulder is the Capital of Outdoor, San Diego should be the Capital of the SAL industry. We are adjacent to the “new China” called Mexico, number 3 in car exports, number 1 in beer, and 5000 miles and 15 timezones closer than the “old China.”  To the east we have the mountains and deserts and all the fun things that come with them. To the west, the Pacific…what can I say? And to the north, Camp Pendleton and 8,000 Marines keeping the Orange and LA Counties up there, away from our peace and serentity!

San Diego is the perfect work ecosystem! Bring your business , bring your self, start a business…this is the place.

But that's not all. We provide Executive Networking, for instance, connecting an emerging company with sales momentum with a local Investment group to fund growth.  We do this actively every day. If we can help connect, that's what we do!

Our executive education programs have been very successful. In 2015 we met Jeff Kearl, the Founder of Skullcandy and Stance, Bob McKnight, the Founder of Quiksilver, Beaver Theodaskis, Founder of prAna, and the amazing Guy Kawaski, Apple’s first marketer and Jeff Harbaugh, a very well known consultant, journalist and skate iconoclast. The goal is to send everyone home just a bit smarter that they arrived. Seems to work!

Last but most importantly, we run the SDSI Springboard Program. This amazing program serves start ups by providing a 20 week mentoring program that converts dreams to business plans. Our Mentors understand this special “space” called SAL and have played a role in helping many companies get started..50 in fact, and they have accessed a little over $40 million in capital!

So the strength of SDSI is membership. If you are not a member, email, call, come in; the more of us, the better.  Join us in making San Diego the best place to live and work anywhere!

bob