Amazon and Alibaba continue to expand into Western Europe—Amazon with hopes of capturing a greater European consumer base, and Alibaba selling luxury European goods to its tens of millions of consumers in China.
Here's why marketers in Western Europe are paying attention to these digital giants:
Amazon's Prime Positioning
Amazon’s mastery of ecommerce—a broad and growing range of products; a user-friendly website; a developed recommendation engine; and reliable and efficient delivery—has made it one of the biggest online retailers in Europe. The company’s reach and logistics position it as the key competitor for retailers in the region.
Widespread and consistent use of Amazon is now the norm in Western Europe. According to a July 2018 report from Periscope by McKinsey, 47% of consumers in Germany noted frequently shopping with Amazon, as did 30% of consumers in Italy. And more than one-fifth (22%) of UK consumers considered themselves to be loyal Amazon shoppers.
Prime is at the core of Amazon’s European expansion. Periscope by McKinsey found that more than half of internet users in Italy, Germany and the UK have a Prime account.
Amazon’s next strategic maneuver is in voice technology. “As more and more consumers use Alexa for purchasing, Amazon will be a primary beneficiary,” said Karin von Abrams, senior analyst at eMarketer. “Amazon Echo is already the leading voice-enabled speaker in most advanced markets.”
AliPay in Play
Unlike Amazon, Alibaba doesn’t sell its own products, but instead functions as a platform for third parties and brands. The company has dual European objectives: to encourage top European brands to sell in China, and to establish and grow a consumer base within Europe.