Interview: Cross-Border Growth Takes Off for eBay China

eBay Inc. Staff

With growth in cross-border trade skyrocketing, eBay China VP John Lin recently weighed in in an interview on the challenge of leading in this exciting market.  Here are his thoughts.

How much has the Greater China Export business grown in the last few years?
It’s been a privilege to see our export business develop from a very small operation in 2006 (generating several million dollars in GMV) to the multi-billion dollar business it is today. China currently accounts for 250 of eBay’s 1,000 biggest sellers globally, which gives you an idea of how far we’ve come.

johnlinWhat has made that kind of growth possible?
Back in 2006 there were lots of problems and risks associated with retail export in China, including fraud and counterfeit goods. But we saw the enormous potential and realised what could be done if we provided sellers with the right training and support to market their products globally. By introducing strict regulation, verification and monitoring of our sellers, we reinvented the world’s perception of doing business with China online.

Do you think there had been a misconception of Chinese sellers in the past?
I do think that ensuring our sellers meet our high retail and service standards has increased trust, yes, but there is still a misconception that our sellers offer value simply because they can source products cheaply. Our biggest sellers ship around 50,000 products a day to 200 countries, so these are highly complex, efficient operations. It’s all about being able to scale things up and that’s something our sellers are very good at.

How has eBay helped them achieve this?
We have a very effective account management team and are passionate about helping our sellers be profitable, encouraging them to invest and to expand into other countries. Their success is our success, so everyone, including the customers, benefits. We give them a route to market that is trusted internationally and the peace of mind of harmonized customer support. We’re also getting our sellers to move towards heavier, higher price items by helping them improve their warehousing capabilities. What few people realize is that around a third of the items they currently buy from Chinese sellers are already held in warehouses in Europe or the US, so this is already happening and I see that increasing.

Why is the Greater China Retail Export market so important to eBay?
It is a massive growth market and is destined to be the number one country for ecommerce in the coming years. Our margins are good and we currently contribute more than a fifth of the total items sold on eBay’s US site. Plus, the statistics show that a significant proportion of first-time eBay buyers make their first purchase from Greater China.

What are your hopes for the future and what challenges lie ahead?
I think we have everything we need to maintain our position as a premium operator and our plans are now to help our sellers make the shift from exporting mainly low cost, low weight products to more expensive, heavier items. In terms of challenges, when you have a winning formula, clearly your competitors will follow. One of our main rivals, Alibaba, has much smaller fees, which is giving them plenty of success, especially in exporting to emerging markets. Amazon is also increasingly active, so we need to keep progressing.