Digital B2B
Outlook
2023
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Introduction
About Alibaba.com
Alibaba.com is one of the largest wholesale ecommerce marketplaces
in the world. Since 1999, small to medium-sized businesses (SMBs)
have connected with a suite of tools built just for business-to-business
(B2B) trade.
Our mission is to make it easy for businesses to do business anywhere.
Alibaba.com connects over 200,000 global manufacturers, wholesalers,
and distributors with a vast network of over 40 million global business
buyers in 190+ countries and regions. It’s an ecommerce marketplace
place platform where buyers and sellers alike can communicate and
trade with one another, access trade services such as payment, order
protection, and shipping, and succeed on their own terms.
The Global B2B Environment
The global B2B environment is currently undergoing a period of
disruption brought about by the outbreak of the COVID-19 pandemic in
2020.
The disruptions to supply chains, cancellation of trade shows, and
restriction of in-person meeting globally accelerated the shift to digital
commerce. While large corporations had the resources available that
allowed them to quickly shift to digitally focused procurement, SMEs
faced a set of challenges including a lack of resources, budget, and
expertise in selling and buying their goods online.
This shift has caused SMEs to increasingly turn to more established
partners in the B2B e-commerce space, who are able to provide the
tools, platform, and reach for SMEs to strengthen their digital presence
and evolve with this new way of doing business.
Digital Outlook 2023
Welcome Letter
Greetings!
In the blink of an eye, 2022 has come to a
close, making way for new opportunities and
greater success in 2023.
If we’ve learned anything in the past few
years, it is that change is the only constant.
Businesses have been forced to adapt in the
face of back-to-back global crises, and
overcoming these hurdles has required
flexibility, hard work, and great resilience. By
observing the businesses that have proven
successful in the face of adversity, we have
discovered several lessons that B2B
businesses can take with them into the new
year.
The first lesson is that a stable B2B
e-commerce platform is worth its weight in
gold. As e-commerce grows, finding a
destination to sell and source goods is very
important. Ensuring that your chosen
marketplace will remain stable as your needs
grow and evolve is even more important.
line. This requires finding a sustainable,
cost-effective solution to avoid overspending.
The reason this is more important than ever is
that the unpredictability of the global
situation can cause instability in your income.
By reducing spending, businesses are able to
stay afloat through temporary decreases in
revenue.
On behalf of Alibaba.com, I wish you a
prosperous New Year. Our organization and
platform are here to help you continue to do
great things in the realm of global trade. We
are confident that with the right strategy and
hard work, your business will continue to
overcome the challenges that come your way.
Alibaba.com has proudly served as that stable
solution to tens of millions of buyers and
sellers over the past 23 years. In that time,
we’ve made it a priority to grow with the
market’s needs to ensure a best-in-class
experience for all users. We do this by
regularly adding new tools and support to
accommodate the ever-changing global B2B
trade landscape.
The second lesson is the value of leveraging
partnerships with reliable suppliers. As a
business owner or operator, you know that
there will be ups and downs, so you need
partners that can ride the waves with you.
Here at Alibaba.com, we find great value in
these partnerships, which is why we offer
dedicated 1-on-1 support to empower sellers
to assume the role of reliable partners with
the goal of creating broader success.
Lastly, we’ve seen the importance of keeping
spending in check to ensure a positive bottom
Regards,
Andrew Zheng
Vice President
Alibaba.com
Table of contents
Global trends in the post-pandemic era
01
Digital export environment
02
i. What is digital export
02
ii. Global trade & economy in post-pandemic
03
iii. Digital transformation of MSMEs
04
iv. Seven digital export trends for 2023
05
B2B Ecommerce in time of instability
08
Key findings on Alibaba.com
09
i. Cost-efficiency
09
ii. Operational skills
11
iii. Global demands
13
iv. Localized service
15
v. Digitalization
17
vi. Conclusion
19
Survey: How small business survived the pandemic
20
i. About the survey
21
ii. Effect of the pandemic on small business
22
iii. How to survive the pandemic
25
iv. The impact of E-commerce & beyond
28
v. Conclusion
31
Part
01
Global trends in the
post-pandemic era
In 2022, companies worldwide experienced various trade shocks, ranging from global conflict to
volatile energy prices and soaring inflation. Thankfully, the ability to digitally reach customers locally
and globally without stretching operating budgets helped provide an important buffer.
01
Digital B2B Outlook 2023
B2B Ecommerce in time of instability
7 digital export trends
for 2023
It’s that time of the year again. As 2022 winds down and B2B companies lay plans for the new year, we’re
looking at the key digital export trends that will shape global trade in 2023.
This year, companies worldwide experienced various trade shocks, ranging from global conflict to volatile
energy prices and soaring inflation. Thankfully, the ability to digitally reach customers locally and
globally without stretching operating budgets helped provide an important buffer.
But how will digital selling change in 2023? What can B2B sellers expect from the competition? By how
much will buyer expectations change in the coming year? Here’s a rundown of the key digital export
trends to look out for in 2023.
What is digital export?
As the name suggests, digital export means engaging in international export trade
using digital selling channels. It typically involves using internet resources like social
media, search engines, e-commerce stores, and online marketplaces to reach foreign
buyers.
Unlike traditional export methods that leverage physical selling channels like
international conferences, trade expos, or local trade contacts in foreign countries,
digital export has several advantages. Because it happens through electronic
platforms, it reduces the expense and logistical challenge of traditional exports.
For instance, you can meet thousands of buyers on a B2B marketplace like
Alibaba.com without needing to source contacts individually. In addition, digital
export through such a marketplace also offers logistical advantages as it provides a
single platform where you can coordinate marketing, negotiations, sales, and
delivery.
Consequently, if you’re new to online selling, it’s worth exploring what digital exports
can do for your business. As you’ll see in the next section, digital trade has been a
lifesaver for many companies over the past three years.
Digital B2B Outlook 2023
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B2B Ecommerce in time of instability
Global trade and economy in the
post-pandemic era
At the onset of the pandemic in 2020, astute experts predicted that the COVID-19
disruption would be the most significant event of this decade. Three years later, this
position is proving prophetic, particularly concerning the e-commerce industry.
2020 brought about an explosion in B2B e-commerce, with more micro, small and
medium enterprises (MSMEs) than ever moving to digital selling. While global trade
suffered, digital exports of consumer goods rose by 14%, compared with 2019.1 But
the effects of the pandemic didn’t remain in just 2020.
In 2021, pandemic-related headwinds caused significant shocks to the global
economy. A sharp rise in consumer demand, fueled by the lifting of lockdown
mandates and stimulus checks, led to an uptick in economic activity for the year. But
the surging demand also caused extensive supply backlogs as producers struggled
to reclaim supply chains from the COVID-induced disruptions of 2020.
As a result, the defining picture of the year for global trade would be clogged ports
filled with ships unable to pick up or drop off overdue cargo, record-high shipping
costs, and increased energy prices. Despite these roadblocks, international trade
continued to enjoy a resurgence, posting a record world trade value of $5.6 trillion by
Q3 2021.2 During the same period, e-commerce sales grew by 11%, continuing the
impressive trend set in 2020.3
2022 has yet to maintain the trade gains of the previous year, however. While global
think tanks like the World Bank had predicted slower global economic and trade
growth in 2022, other factors conspired to make actual performance for the year
worse. Multi-year high inflation levels, the damaging Russia-Ukraine war, continuing
COVID-19 outbreaks in Asia, and a spate of global interest rate hikes all contributed
to worse trade performance during the year.
According to the World Trade Organization (WTO), world trade will lose momentum
this year due to these shocks. While global merchandise trade volumes are expected
to grow by 3.5% in 2022, those figures will likely fall significantly to 1% in 2023. 4
Inflation is still a concern, with energy prices up 78% compared to last year and food
prices up by 11%, and there is no slowdown currently in sight.4
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Digital B2B Outlook 2023
B2B Ecommerce in time of instability
Real GDP growth projections for 2022 and 2023
Year-over-year,%
Saudi Arabia
India
Indonesia
China
Turkey
G20
Global
Korea
Australia
Spain
Mexico
Canada
Japan
South Africa
Brazil
France
United States
Italy
Argentina
United Kingdom
Germany
Russia
-5.5%
6%
5.7%
4.8%
4.7%
9.9%
6.9%
5%
3.2%
3%
2.2%
2.2%
2.2%
2%
5.4%
2.8%
3%
2.8%
4.1%
4.4%
2.1%
3.4%
1.6%
1.7%
2.5%
2.6%
What’s next?
1.5%
3.4%
3.6%
3.4%
-4.5%
0.0%
0.0%
2022
2023
Source: OECD Economic Outlook,Interim Report September 2022
The OECD reports similarly
conservative figures,
putting expected global
economic growth at just
2.2%, compared to the
earlier projected 3.2%.5
These projections likely
mean small companies
faced with difficult
conditions this year might
not get a respite in 2023.
Consequently, it makes sense for concerned sellers to pursue means to manage their
risk and reduce exposure to the effects of an increasingly uncertain global economy.
Digitalization and a shift to online selling can help cushion these effects and
potentially provide a platform for growth.
Importance of digital transformation
for MSMEs
Digital transformation is the deliberate effort to improve a company’s operations
using digital tools. It’s a modern operational mindset that looks for ways to achieve
efficiency and productivity gains through digital technologies.
As the OECD suggests, even though digital transformation is crucial for MSMEs, these
companies often need to be more digital. For instance, research indicates that, in
many countries, less than 40% of employees in small firms use connected
computers.6 Even fewer companies adopt digital solutions such as enterprise
resource platforms and e-commerce stores in their day-to-day work.
However, companies that adopt digital transformation in their operations can unlock
several potential benefits, including possibilities to:
Reduce business risk: Many companies face dramatically increased risk due to
today’s business environment. For instance, operational risk from an inability to
find customers and dispose of inventory was a threat for many MSMEs during the
pandemic. Going digital helped many companies combat this risk, as they could
access selling opportunities while their physical locations were closed.
Reach more customers: Clearly, digital export presents far more opportunities to
find, connect with, and convert more buyers. With the nearly unlimited
possibilities of digital trade, small companies have few limitations to the range
and quality of prospects they can access. And when they combine this advantage
with great marketing on a helpful platform, they can find more high-quality leads
that ultimately convert into a sale.
Digital B2B Outlook 2023
04
B2B Ecommerce in time of instability
Improve productivity and manage costs: Small companies that implement
digital transformation can reduce costs and boost productivity by 16% on
average.7 You can save time on low-value labor and reinvest that time in quality
interactions that grow your business. Likewise, companies with digital selling
channels ultimately spend less on acquiring new clients and can expand
internationally at little cost.
Boost company profits: Digital transformation also helps unlock greater profits
and trade presence. For instance, one study found that 85% of companies
implementing digital processes acquired greater market share.8 They were also
able to increase company value by 25%.7
Ensure business certainty: Ultimately, it’s important to recognize that choosing to
go digital is choosing certainty in an unpredictable business world. Amidst supply
and demand chain shocks, enduring viral outbreaks, and an unstable geopolitical
landscape, the reality for small businesses is that every advantage counts. If that
advantage consists in having a reliable way to sell through supply and demand
shocks, then it’s worth taking a closer look at.
7 digital export trends for 2023
The coming year will see some enduring trends continue, like the rise of
personalization and video marketing in B2B e-commerce. But some new trends will
take center stage, such as a fall in the time consumers spend online.
Being up to date on these trends, and understanding their underlying data, will be
crucial to business success in 2023. Let’s dive in.
1. Digital migration
We’ve discussed how more companies have transitioned to digital selling
since 2020. This trend is set to continue in 2023. According to data from the
OECD, 70% of small companies surveyed said the impact of COVID-19 drove
them to make greater investments in digital technologies.6
With the enduring shocks of the pandemic, more businesses will go digital.
The relative certainty of digital selling will be just what many companies
need to keep operations ticking over in the coming year.
One implication of this trend is that B2B online sellers will likely see greater
competition next year. Consequently, if your business is not yet digital, you
should plan to transition by next year.
70%
of small companies
surveyed said the
impact of COVID-19
drove them to make
greater investments
in digital
technologies.
2. Digital marketing and administration
More small companies will find their way online in 2023. But many of the
newcomers will look to make a gradual entry into the digital selling space. The
OECD suggests that new digital market entrants will prioritize electronic
marketing and administrative functions.
93%
Digital marketing is already a big draw for companies, especially considering
that 93% of all interactions on the internet happen through search engines.9
With digital marketing, new entrants can immediately start working to gain a
share of those interactions.
of all interactions on
the internet happen
through search
engines.
There’s also likely to be a rise in companies using digital tools for
administrative purposes. For example, popular products like Notion, Evernote,
and Canva are options businesses can employ for organizing and clerical tasks.
05
Digital B2B Outlook 2023
B2B Ecommerce in time of instability
3. Data-led marketing
Marketing is increasingly a precise exercise focused on targeting specific prospects.
We’re now well beyond the days of B2B marketing strategies hinged on guesswork.
With data-led marketing, businesses are introducing greater accuracy to their
marketing. As a result, they can yield better results and gain more insights from
previously opaque data sets.
Part of this capability arises from better tools that let companies access and exploit
broader data types. There’s a greater variety of data that enables companies to plan,
test, and launch successful marketing campaigns. Companies can also apply better
data to assess and learn from marketing campaigns.
4. Personalization
Personalization across various business touchpoints continues to be a key trend for
digital exports. Customers don’t want to feel like just one of thousands – they want to
feel seen and heard.
How do you implement personalization in your business practices? Start by
incorporating personal details in communications with the client. For example, are
you sending cold emails? Simply addressing the customer by their name can help.
You can also research the client’s unique needs and incorporate that into your
proposition.
Other ways customers seek personalization include how they are offered services
and products. For instance, a customer who bought from you expects you to know
their previous purchases and leverage that information during a repeat purchase.
5. Time spent online
People typically spend between six and seven hours on the internet. According to
statistics, the average person spends roughly 40% of their waking life accessing an
internet-enabled device or service.
But those statistics have fallen recently. Average time spent online fell to 6.47 hours
from 6.53 hours in Q4 2021.10 While this drop isn’t significant, it is an indicator of a
likely peak in the overall time that people spend using the internet.
6. Video marketing
Video is a compelling medium due to its ability to engage by showing. So, it’s
unsurprising that video marketing continues to gain ground in digital export.
Platforms like Alibaba.com incorporate video into their marketing channels to help
foster greater engagement with buyers.
What’s next?
As a result, offering digital
content to users may
become trickier for
businesses. There’s now a
greater need to ensure
they’re providing enduring
value. Otherwise, they
may find users leaving
their content for other
digital consumables.
While short-form videos are currently the most popular, there is scope for growth in
the consumption of long-form and live-streamed videos. Most important is ensuring
that prospects see images that align with their buying intentions.
Digital B2B Outlook 2023
06
B2B Ecommerce in time of instability
7. Real-time messaging
Finally, along with growing buyer preference for rapid service, real-time messaging is
emerging as a key trend for B2B digital exports. Buyers don’t want to wait hours or
days to receive responses from B2B sellers.
Consequently, sellers are implementing methods to ensure real-time or
near-real-time buyer engagement. These include the use of chatbots incorporated
into their e-commerce store. For sellers with a presence on B2B marketplaces, one
option is to employ mobile applications they can access on the go.
References:
1
https://www.morningfuture.com/en/2021/05/26/export-e-commerce-pandemic/
2
https://unctad.org/news/global-trade-goods-hits-all-time-quarterly-high-56-trillion
3
https://www.salesforce.com/resources/research-reports/shopping-index/
4
https://www.wto.org/english/news_e/pres22_e/pr909_e.htm
5
https://www.oecd.org/economic-outlook/september-2022/
6
https://www.oecd.org/industry/smes/PH-SME-Digitalisation-final.pdf
7
https://www.mti.gov.sg/-/media/MTI/Resources/Economic-Survey-of-Singapore/2019/Economic-Survey-of-Singapore-First-Quarter-2019/FA2_1Q19.pdf
8
https://www.sap.com/dmc/exp/4-ways-leaders-set-themselves-apart/index.html
9
https://www.imforza.com/blog/8-seo-stats-that-are-hard-to-ignore/
10
https://datareportal.com/reports/looking-ahead-to-what-2023-holds
07
Digital B2B Outlook 2023
Part
02
B2B Ecommerce in
time of instability
In a time of global recession and instability, we collected a list of critical elements on what kind of
sellers can leverage the power of B2B eCommerce with Alibaba.com to sustain their business.
Digital B2B Outlook 2023
08
B2B Ecommerce in time of instability
As a seller you may wonder:
What are the best opportunities for sellers on Alibaba.com?
What kind of business is most suitable for Alibaba.com?
Alibaba.com is
tailor-made for small
businesses to reach
out to new markets
Unlike Chinese suppliers on the platform, the majority of GGS suppliers
on Alibaba.com are manufacturers who produce their own products,
with nearly 40% of suppliers having annual revenue of less than $
100k. It is a more economical channel for small business owners who
don't possess the experience or knowledge of exporting or simply
cannot afford the cost of business travel and offline tradeshows.
Alibaba.com Merchant Persona
Business type
Annual revenue of foreign B2B trade
100%
0.207
0.232
0.379
80%
0.245
80%
0.244
60%
0.302
40%
20%
60%
0.465
0.466
0.357
40%
20%
0.549
0.398
0.156
0%
GGS
CGS
0%
GGS
CGS
Trading company
Large: 1 million USD
Manufacturing and trading combined
Medium: 100k to 1 million USD
Manufacturer
Small: Less than 100k USD
Source: Alibaba.com Customer Experience Survey
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Digital B2B Outlook 2023
B2B Ecommerce in time of instability
Duong Khanh Toan
Director of International Business Development
ME TRANG COFFEE JOINT STOCK COMPANY
In the new year, we will put more money and investment into
Alibaba.com, because the Alibaba.com platform is the most
economical way to market now. And traditional marketing is
too much expensive for us.
Loy Alvin Gin Hui
Founder
M/S INDIAN DECOR HANDICRAFTS
We’ve worked with several e-commerce platforms in the past,
but the performance was quite disappointing. This is especially
in terms of the quality of leads and customer service. But not
with Alibaba.com. We get better quality leads from
Alibaba.com, which is vital for my business. It is because of
Alibaba.com that we could reach certain countries and vendors.
Digital B2B Outlook 2023
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B2B Ecommerce in time of instability
Alibaba.com is a
beginner e-commerce
choice for many B2B
sellers
According to our survey, 60% of suppliers here doesn't have previous
E-commerce experience before joining Alibaba.com. This means, if you
have some e-commerce operational skills before, you are already in a
better position than many existing sellers. Moreover, it shows that
sellers who spend more time studying the platform rules or hire an
account manager/exporting manager dedicated to the platform, are
more likely to have better results from the platform.
Experience in operating e-commerce platforms before
joining Alibaba.com
Marketing through online channels,
but not selling on e-commerce
platforms
38%
No experience in e-commerce
platform operation
60%
22%
Only selling in offline channels
Have experience of selling on
e-commerce platforms, but lack of
experience in marketing and operation
20%
Experienced in marketing and
operation of e-commerce platforms
20%
Experience in e-commerce
platform operation
40%
Business before joining Alibaba.com
39%
Mostly/All foreign B2B trade
Mostly/All foreign B2C trade
46%
7%
Mostly/All domestic B2B trade
Mostly/All domestic B2C trade
20%
Started a business through
Alibaba.com, but without a relevant
experience
17%
6%
Mostly/All domestic trade
31%
11%
Worked for a relevant company and
started a business through
Alibaba.com
Mostly/All foreign trade
Started a business
through Alibaba.com
23%
Source: Alibaba.com Customer Experience Survey
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Digital B2B Outlook 2023
B2B Ecommerce in time of instability
Mr. Vijayan S
CEO
HYPERCRYSTALS
After completing my master's degree in Business (MBA), I joined
Alibaba.com as an account manager for 2 years. I didn’t need
any introduction to Alibaba.com's B2B e-commerce platform
because I had first-hand experience with how businesses could
use it to grow.
Haci Ali Kucuksakarya
Founder
Ayseliza IC VE DIS Ticaret Limited Sirketi
I live on Alibaba.com, to be honest. Whenever I get home from
work, I open my computer and go straight to Alibaba.com. I
check for updates, and join all the training – even the Chinese
language training! – and I’m always trying out new things on
the platform. HYPERCRYSTALS currently gets 90% of its revenue
from exports and just 10% from domestic sales. Also, 90% of the
company’s international customers come from Alibaba.com.
Usman Asif
Founder
Moytei Sports
I had two platforms on my mind then. One is a popular B2C
platform; one is a B2B platform-Alibaba.com. I chose
Alibaba.com. Because the Aibaba.com platform required very
little capital and almost no experience to get started.
Digital B2B Outlook 2023
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B2B Ecommerce in time of instability
Alibaba.com is ideal
for sellers who want to
tap into new markets
for potential buyers
Alibaba.com is ideal for sellers to reach out to customers that they are
unable to reach in traditional channels, such as business travel and
tradeshows. 42% of sellers use Alibaba.com as their primary source of
business with 60% aiming to break into new markets.
Reasons for joining the Alibaba.com
Expanding export countries and
markets
61%
Offline business expand to online
channels
20%
Start a business through
Alibaba.com
15%
Transform from domestic trade to
foreign trade
13%
Others
1%
Positioning of Alibaba.com in B2B foreign trade
Most important sales channels for
B2B foreign trade
42%
One of the main sales channels for
B2B foreign trade
29%
Supplementary channels for B2B
foreign business
Not operating Alibaba.com
26%
4%
Manufacturer
Manufacturing
and trading
combined
Trading
company
Most important sales channels for
B2B foreign trade
38%
41%
50%
One of the main sales channels for
B2B foreign trade
30%
31%
25%
Supplementary channels for B2B
foreign business
30%
22%
22%
Not operating Alibaba.com
3%
5%
2%
Source: Alibaba.com Customer Experience Survey
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Digital B2B Outlook 2023
B2B Ecommerce in time of instability
Gianluca Vincolato
Export Manager
Ursini srl
Alibaba.com provided us the opportunity to boost our digital
presence and to be in touch with potential customers in different
countries, including Bangladesh, a country I never thought we
could reach.
KAI XUEN TEE
Business Develop Manager
L.K TEE ENTERPRISE SDN BHD
Before we use Alibaba.com, we have never exported to Maldives,
as it is a small market in our minds. But in fact, this traditional
market is huge. Customers know about us through the
Alibaba.com platform. We are surprised that, the gross sales
value of containers is from $60k to $150k in this market. We
never know Maldives is such a potential market. We now have
more than 20 main buyers from Maldives in different industries.
Wen Wong
Founder
King O King Jewellery Co. Limited
Being a seller on Alibaba.com for two years now, I have been
able to close deals with buyers from the US and Columbia. I am
astounded by how smoothly the transactions go each time and
recognize the platform's potential to increase future earnings. I
am looking forward to Alibaba.com's trade exhibitions because
they help us connect with buyers whose trust I have earned
through Alibaba.com.
Nguyen Thi Dung
Sales Manager
PHAM BA TIEN HOUSEHOLD
Alibaba.com helped us get started in international exports in
2016, and since then, our revenues have nearly quadrupled.
Within three months of posting products on Alibaba.com, Pham
Ba Tien Household gained our first customer – a US buyer who
concluded their purchase in just one hour!
Digital B2B Outlook 2023
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B2B Ecommerce in time of instability
Alibaba.com puts
great importance on
its channel service,
and you should make
the most of it
Customer service is one of the highest-rating aspects according to the
user experience survey. Sellers can seek exclusive technical and
operational support from account managers on Alibaba.com, which
effectively help them grow their business. Around 80% of sellers receive
direct help from account managers. 30% of them contacted their
account managers at least once a month.
Ways to seek help when encountering problems and effectiveness - Overall
82%
68%
64%
57%
57%
49%
58%
35%
25%
24%
18%
7%
4%
Account
Manager
Customer Service
Help Center
Learning
Center
MA Backstage
guide
Search
online
Ask friends
for help
Others
Ways to seek help when
encountering problems
Effective in helping to solve
problems
Source: Alibaba.com Customer Experience Survey
15
Digital B2B Outlook 2023
B2B Ecommerce in time of instability
Haci Ali Kucuksakarya
Founder
Ayseliza IC VE DIS Ticaret Limited Sirketi
I am particular about the helpful assistance my company gains
from support reps on Alibaba.com. I’ve been on other
marketplaces where simple issues can take up to six months to
resolve. Alibaba.com provides a better experience for me,
providing my business with swift support and effective
resolution.
Abuzar Ikram
Marketer
M/S INDIAN DECOR HANDICRAFTS
Every time I found problems with how to use Alibaba.com, I
called the Alibaba.com support team for help immediately. The
support of Alibaba.com is very nice. The local partner offered me
a lot of help.
Angela H. Brown
Founder & CEO
D' Serv Healthy Hair Care
The Alibaba.com team is great. With people like them, I know it
can work! That's what keeps D'Serv thriving.
Toyiah Marquis
Founder
Patch Party Club
I have been so impressed with the team at Alibaba.com. They've
helped me every step of the way and have been so invested in
my success.
Digital B2B Outlook 2023
16
B2B Ecommerce in time of instability
Alibaba.com provides
to one of the most
helpful tool for small
businesses to get
through the Covid-19
pandemic
Over 55% of small business owners saw their revenue drop during the
pandemic, and 20% reported that they shut down altogether.
However, almost 15% of respondents report that their businesses
stayed the same, and 10% of respondents saw their business rise
instead of fall. Among those who succeeded, utilizing e-commerce was
the top strategy for surviving the pandemic.
Trade Business Affected by the Pandemic
55%
20%
15%
Business
dropped
Completed
shutdown
Almost the
same compared
with years ago
10%
Higher
than before
Source: Surveys by Alibaba.com
17
Digital B2B Outlook 2023
B2B Ecommerce in time of instability
Maria Francesca Aceti
CEO
Deltha Pharma Societa a Responsabilita Limitata
The pandemic has brought many challenges to our business. But
luckily in 2019, I had already joined Alibaba.com. Most Italian
businesses were dramatically affected when offline sales
stopped. But Deltha Pharma turned this difficulty into an
opportunity by pushing digitalization into our business.
Especially through digital marketing and marketplaces like
Alibaba.com. During this period, there was a huge request for
vitamins and products for the immune system.
Wen Wong
Founder
King O King Jewellery Co. Limited
After COVID, I had to stop business travel. The business dropped
70%. It was still profitable, but I had to let go of some staff.
Joining Alibaba.com was the single move that helped my
business recover after the pandemic. I have been able to resume
international trade, and this time, I don't even have to travel
around to close sales. Instead, the customers request a paid test
sample, and when they’re satisfied with the quality, they place
their bulk orders.
Digital B2B Outlook 2023
18
B2B Ecommerce in time of instability
Conclusion:
Why you should choose
Alibaba.com
What kind of sellers can
succeed on Alibaba.com?
Sellers with good negotiation skills, outstanding country-of-origin effects, and low
Minimum Order Quantity (MOQ) are more likely to succeed on Alibaba.com.
Investment in platform operation is essential for sellers to reach more customers.
Effective daily operation enables sellers to secure more orders. Over 30% of sellers
who arrange specialized personnel to operate their online stores can secure more
than 6 significant orders on the platform annually.
For sellers who operate by third-party agents, around 1 to 10 orders can be secured
in the first year.
Which sectors have the
most growth potential?
Apparel, Home & Garden, Beauty & Personal care, and Food & Beverage are
large-scale and high value sectors for suppliers out of China on Alibaba.com. The
Sports & Entertainment sector also witnessed quick growth in scale in recent years.
Among them, Food & Beverage sector is in the “blue ocean”, while Apparel, Home &
Garden, beauty & personal care sectors are in the “red ocean”. That means sellers
have fewer competitors and more opportunities to increase their sales in the Food &
Beverage sector.
It is estimated that Food & Beverage sector has buyers with a purchasing power of
U.S. $750 million. The rapid growth of the food & beverage sector is mainly
contributed by alcohol, chocolate and soft drink products. Coffee also shows huge
potential, but it depends more on the quality of the products.
*Source: Industry Opportunity Research on Alibaba.com
Cost-effectiveness:
How to invest?
B2B e-commerce is a cost-effective solution to sustain business to avoid
overspending, especially for small businesses. Over half of sellers arrange
specialized personnel to operate their stores on Alibaba.com. It shows sellers who
invest more in sales operations tend to secure more orders.
Sellers can seek exclusive technical and operational support from account managers
on Alibaba.com, which effectively help them grow their business. Around 80% of
sellers receive direct help from account managers. 30% of them contacted their
account managers once a month. Currently, most sellers are satisfied with the
services offered by account managers.
The critical time to
transform digitally
E-commerce has emerged as the main force of Southeast Asia's digital economic
growth which Vietnam has a remarkable potential to develop. The growth rate of
e-commerce in the period 2013 – 2019 is always high, over 20 %/year. As a result,
from a low starting point of $2.2 billion in 2013, the size of the e-commerce market
has grown to about $10.08 billion in 2019. According to the 2019 e-Conomy SEA
Report of Google and Temasek, The Compound Average Growth Rate (CAGR) for
2015-2025 is 49%, and the market size is expected to reach $23 billion by 2025.
Digital transformation is a process that has begun to be accelerated in recent years,
businesses need to be aware of that development trend to catch business
opportunities in the digital environment.
19
Digital B2B Outlook 2023
B2B Ecommerce in time of instability
How small businesses survived the
pandemic: Alibaba.com survey
The pandemic affected many businesses across the world. Some businesses excelled, but unfortunately,
many others failed. B2B suppliers were in for an especially wild ride as they had to work quickly to bend
to the ever-changing needs and demands of B2B buyers.
In an attempt to better understand the implications of operating Micro, Small, and Medium Enterprises
(MSMEs) for over two years of the pandemic, Alibaba.com put out a survey to learn more about how
different global suppliers navigated the pandemic.
A few of the questions the survey asked included:
After the pandemic, do you believe that Alibaba.com is still valuable to small business
owners?
How did the pandemic impact your trading business, being being a small business
owner in recent years in recent years?
What did you do to sustain your business during the pandemic?
In terms of improving business environments, what [do you] most expect from other
sectors of society?
The survey also gathered data on company size, location, and business type to better understand
who the respondents are.
Our main goal with the survey was to understand the effects of the pandemic on global suppliers
and assess how they navigated the trials and tribulations of the last two years. We also wanted to
determine how important B2B e-commerce was for small businesses during this time.
Since history tends to repeat itself, documenting how different types and sizes of businesses fared
through this global crisis will better equip businesses to navigate crises of similar magnitude in the
future.
In this report, we will discuss the findings of the Alibaba.com small business survey for global suppliers.
We will review how the pandemic affected small businesses and how these businesses survived the
pandemic. We will also discuss the importance of e-commerce marketplace to small businesses after the
pandemic and what small business owners expect for future support.
Digital B2B Outlook 2023
20
B2B Ecommerce in time of instability
Who participated in the survey?
Alibaba.com received survey responses from over 1000 B2B suppliers from around
the world. This group is made up of both latent customers and in-service customers,
so the past or present use of Alibaba.com was the commonality among all
respondents.
Asia was by far the most prevalent location of the suppliers who filled out the survey.
The most common countries represented by respondents include India, Pakistan,
Turkey, Japan, Indonesia, Italy, Canada, Malaysia, Vietnam, and the United States.
There was representation from every inhabited continent of the world.
Trade Business of small businesses in Selected Economies Affected by the Pandemic
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
il
ico
ex
M
Af
ri
So
ut
h
Br
az
ca
nd
la
ia
ai
Th
M
al
ay
s
sia
m
ne
an
na
et
do
In
Vi
a
di
ist
Pa
k
In
ke
y
Tu
r
n
Ko
re
a
pa
h
Ja
So
ut
ia
ra
l
ly
da
na
st
Au
Ca
Ita
an
y
ce
rm
K.
Ge
Fr
an
U.
U.
S.
0%
My trading business went higher than before
My trading business was almost the same compared with years ago
My trading business dropped, but less that 50%
My trading business dropped over 50%
My business was completed shut down
Data sources: Survey by Alibaba.com
Note: According to the OECD classification, surveyed enterprises with less than 250 employees are considered small businesses; possible bias
cannot be ruled out due to the small sample size in some countries.
Respondents were able to indicate the size of their organization based on the
number of employees that they have. They had the option to choose 0-10, 10-50,
50-250, or 250+. The vast majority of respondents, or precisely 95%, were small
businesses with less than 250 employees, and 80% of the respondents had less than
50 employees.
Manufacturers take the highest percentage of survey responses, accounting for more
than 60%. The other 40% of respondents were trading companies, distributors, and
entrepreneurs. Trading companies accounted for 17.5% of total respondents, and
distributors and entrepreneurs accounted for 7.8% and 14%, respectively.
Understanding who participated in this survey is important because it allows us to
recognize the true scale of the effects of the pandemic on B2B businesses.
21
Digital B2B Outlook 2023
B2B Ecommerce in time of instability
How the pandemic affected mall businesses
As we mentioned, the pandemic affected everybody differently since each nation had
a unique response to the coronavirus. Some countries simply locked down their
borders whereas others limited all “non-essential” operations.
However, the global restrictions and disruption did spark some widespread shifts
that were felt around the world. Global demands shifted, lockdowns sparked
shortages, and e-commerce became a major in B2B trade.
Businesses of all types and sizes were forced to quickly adjust their operations to
navigate things that were thrown their way. Many had to pivot within their industry in
order to survive. For many businesses, the issues caused by the pandemic were
simply too much.
In general, over 55% of respondents saw their revenue drop, and 20% report that they
shut down altogether. However, almost 15% of respondents report that their
businesses stayed the same, and 10% of respondents saw their business rise
instead of fall.
Let’s take a closer look at how businesses with different sizes, types, and locations
fared through the pandemic.
Digital B2B Outlook 2023
22
B2B Ecommerce in time of instability
1. Effects of the pandemic on small businesses by company size
The pandemic had more negative effects on smaller on smaller businesses. For
example, 25% of survey respondents with under 10 employees shut down
completely, whereas only 13% of respondents with over 250 employees had the same
results.
Trade Business Affected by the Pandemic for Enterprises of Different Sizes
100%
80%
11%
10%
9%
12%
13%
13%
29%
27%
17%
60%
40%
20%
0%
22%
22%
35%
32%
25%
0-10
17%
32%
16%
19%
10-50
50-250
26%
13%
250+
My trading business went higher than before
My trading business was almost the same compared with years ago
My trading business dropped, but less that 50%
My trading business dropped over 50%
My business was completed shut down
Data source: Survey by Alibaba.com
In addition to lower shutdown rates, 17% of respondents with more than 250
employees reported that the pandemic left their businesses better off than before.
This is nearly double the success of businesses with under 10 employees. Only about
9.8% of respondents in the latter category reported that their businesses were better
off than before the pandemic.
Respondents with 10 to 50 employees and 50 to 250 employees had very similar
results to one another. Both were better off than smaller companies but worse off
than larger companies.
From this, we can deduce that larger businesses with more employees were better
off throughout the pandemic. This is not to say that larger B2B companies went
unharmed as a whole, but they were more likely to survive the pandemic than their
smaller counterparts.
2. Effects of the pandemic on small businesses by business type
The survey received responses from four different types of businesses, and each type
had slightly different outcomes after experiencing the damages of the pandemic.
Surprisingly, there was very little correlation across the board.
Based on the results of the survey, trading companies had the lowest percent of
shutdowns at 16%, and entrepreneurs had the highest at 30%. Manufacturers and
distributors fell somewhere in between with 19% and 22% of respondents shutting
down, respectively.
23
Digital B2B Outlook 2023
B2B Ecommerce in time of instability
However, when it comes to businesses remaining unaffected or doing better,
distributors were the best off with over 35% of respondents having a positive
outcome. Unfortunately, of the respondents who were entrepreneurs, only about 17%
had a positive outcome. About 23% of manufacturers and 26% of trading companies
had favorable results.
Trade Business Affected by the Pandemic for Enterprises of Different Types
100%
80%
60%
40%
9%
14%
26%
13%
13%
21%
32%
36%
19%
16%
20%
0%
Manufacturer
Trading company
16%
19%
14%
10%
7%
14%
39%
29%
22%
Distributor
30%
Entrepreneur
My trading business went higher than before
My trading business was almost the same compared with years ago
My trading business dropped, but less that 50%
My trading business dropped over 50%
My business was completed shut down
Data source: Survey by Alibaba.com
Digital B2B Outlook 2023
24
B2B Ecommerce in time of instability
How businesses survived the pandemic
The pandemic brought forth a plethora of unprecedented issues and situations, so
businesses had to get creative to survive the ups and downs.
Some of the ways that businesses survived the pandemic included:
Expanding sale channels
Exploring e-commerce or digitalization
Controlling the business’s finances
Investing in research and development to upgrade products
Seek support from local governments or institutes
Steps Taken to Keep Business Going During COVID-19 by Firms of Different Sizes
100%
90%
17%
80%
8%
70%
11%
9%
10%
4%
7%
15%
15%
12%
17%
60%
50%
8%
32%
38%
37%
32%
32%
33%
0-10
10-50
50-250
20%
40%
30%
20%
43%
10%
0%
Expand sale channels
Attempt e-commerce or digitalization
Control the corporate finance
Invest in R&D to upgrade products
250+
Seek support from local governments or institutes (apply for subsidies, participate in government schemes)
Data source: Surveys by Alibaba.com.
According to the survey responses, utilizing e-commerce was the top strategy for
surviving the pandemic. Expanding sales channels came in as a close second.
Let’s take a closer look at how each of these survival mechanisms looked for small
businesses in the global trading spaces.
1. E-commerce and digitalization
Businesses were forced to get creative during the pandemic to keep their sales up.
Those who had previously relied on their brick-and-mortar showrooms and other
dated sales were forced to get creative.
B2B e-commerce marketplaces, such as Alibaba.com, have become a valuable
resource to many traders. However, these platforms represent only one element of a
multichannel sales strategy.
Direct-to-consumer (DTC) sales can also play an important role in a sales channel
expansion. As the name suggests, it involves selling directly to consumers with no
25
Digital B2B Outlook 2023
B2B Ecommerce in time of instability
middleman. This can be facilitated via e-commerce, traditional sales, or social
selling.
Coincidently, social selling is another important element of multichannel sales. Social
selling involves selling through social media sites. As social media platforms
continue to evolve, many are adding dedicated commerce tools that enable
businesses to sell products right on their social profiles.
2. Expanding sales channels
The pandemic has served as the driving force of digitalization in global trade. Before
the pandemic, e-commerce was already prevalent in B2C retail, but the pandemic
changed the game for B2B trade, especially when it comes to cross-border trade.
Some of the first major restrictions in the early days of the pandemic were restrictions
on travel. Since business people couldn’t travel to meetings, conventions, and trade
shows to carry out deals, as usual, they were forced to rely on digital means.
The rapid growth of B2B e-commerce1 came as a result of the dire need for
digitalization. It allowed businesses to take their operations online. B2B e-commerce
marketplaces, such as Alibaba.com, helped to make this process quite seamless.
3. Controlling finances
There are two ways may possibly increase your profit: cut your expenses or make
more sales. Since many businesses struggled to even maintain sales during the
pandemic, cutting expenses became the only option.
Businesses were forced to assess what’s most important to their business operations
and cut costs accordingly. Some ways that businesses cut costs2 to control their
finances included:
Closing offices
Laying off employees
Optimizing operations
Severing contracts with freelancers
Unsubscribing from software and services
For some businesses, these actions were permanent, and for others, it was
temporary. Most did what they had to do to survive.
Digital B2B Outlook 2023
26
B2B Ecommerce in time of instability
4. Investing in R&D
Sticking out amongst the competition has never been more important. Many
businesses have invested in research and development (R&D) in order to keep up
with and surpass the competition. By investing in R&D, businesses can improve their
products, optimize their process, and expand their services.
Investing in R&D will have different returns in different situations. For example,
investing in optimizing your processes can raise your bottom line by saving money.
On the other hand, investing in product development can provide the leverage you
need to raise your prices or appeal to a larger audience.
5. Local government aid
Many governments and other institutions offered aid to businesses throughout the
pandemic. The idea was to help businesses stay afloat to reduce unemployment.
Many businesses received thousands to millions of dollars in aid over the course of
the pandemic.
The United States, for example, had several financial aid programs for businesses
throughout the country. The Small Business Association, which is an organization
backed by the U.S. government, rolled out an initiative called Payroll Protection
Program (PPP). It was a forgivable business loan to help businesses pay their
employees.
There were a ton of similar programs offering small business aid across the EU, as
well. Each institution and organization structured its emergency funding a little
differently.
27
Digital B2B Outlook 2023
B2B Ecommerce in time of instability
The importance of E-commerce through and beyond
the pandemic
Alibaba.com has served as a valuable resource to many businesses over the course
of the pandemic. It has helped businesses move their operations online in order to
stay afloat during the pandemic. Not only does Alibaba.com serve as an e-commerce
marketplace, but it facilitates trade in a way that improves accessibility for businesses
around the world.
Alibaba.com hosts virtual tradeshows and other digital sales events to help
businesses come together to form professional relationships. Plus, e-commerce
platform offers smart communication tools that auto-translate conversations which
makes it possible to overcome language barriers and connect with more potential
trade partners.
These and other tools from Alibaba.com have helped businesses break into the
digital space and survive the pandemic.
In general, 55% of customers who responded to the survey think e-commerce
marketplace like Alibaba.com is still of great value to small businesses after the
pandemic, and 32% of customers reported that it still has some value to their
operations. That means that a total of 87% of respondents had a positive take on
Alibaba.com as a part of their post-pandemic operations.
Let’s take some time to look closer at the importance of e-commerce marketplace for
small businesses by company size and type.
Digital B2B Outlook 2023
28
B2B Ecommerce in time of instability
1. The importance of E-commerce to small businesses by
company size
Among businesses with up to 10 employees, 58% of survey respondents say that
B2B e-commerce platform like Alibaba.com remains very important even as the
pandemic becomes less of an issue. Just under a third of businesses of that size
claim that Alibaba.com is relevant to some degree, and only a handful say that the
B2B e-commerce platform has become irrelevant with the passing of the pandemic.
Respondents with 10 to 50 and 50 to 250 employees had almost identical results.
Among those with 10 to 50 employees, 51% responded that B2B e-commerce
platform like Alibaba.com remains very important, 35% responded that it remains
somewhat important, 12% responded that it is not important, and only 4%
responded that the e-commerce platform does not matter.
Among the companies with 50 to 250 employees, 51.7% responded that B2B
e-commerce platform like Alibaba.com is very important, 32.5% said that it was
somewhat important, 10.7% reported that it is no longer important, and 8% report
that it doesn’t matter.
However, about half of the respondents with more than 250 employees answered
that B2B marketplace like Alibaba.com remained important, and the other half said
that Alibaba.com was still relevant to some degree. Only 1 of the 45 respondents with
250+ employees said that e-commerce marketplace was no longer important.
From this data, we can also see that the majority of respondents see value in
continuing to use B2B e-commerce like Alibaba.com to support their businesses
post-pandemic. Since nearly 98% of businesses with over 250 employees responded
that Alibaba.com will still be at least somewhat relevant after the pandemic, we also
see that the platform is considerably more important amongst larger businesses.
Ratings for Alibaba.com from Enterprises of Various Sizes
100%
90%
80%
3%
7%
2%
2%
4%
8%
12%
11%
35%
32%
48%
61%
51%
52%
48%
0-10
10-50
50-250
29%
70%
60%
50%
40%
30%
20%
10%
0%
very important
To some degree
Not important
250+
Doesn’t matter
Data sources: Surveys by Alibaba.com.
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Digital B2B Outlook 2023
B2B Ecommerce in time of instability
2.T he importance of E-commerce to small businesses by
business type
According to the survey responses, Alibaba.com was just about proportionately
important to each business type. The responses from distributors varied the most
from the other results, but not by much.
Almost 50% of manufacturers, 58% of trading companies, 67.6% of distributors, and
58% of entrepreneurs reported that E-commerce platform like Alibaba.com remains
very important to their companies. Based on these responses, e-commerce platform
seems to have been the most important to distributors.
On the flip side, less than 4% of manufacturers, 5% of trading companies, 1.4% of
distributors, and 2.7% of entrepreneurs said that B2B e-commerce platform no longer
matters to their companies. Again, the least negative response was from distributors.
3. small businesses’ expectations for future support
Small Businesses' Expectations for Improving the Business Environment
45%
40%
35%
30%
25%
20%
39.69%
15%
10%
19.26%
16.44%
12.08%
12.53%
5%
0%
Platform companies
offer favoured
policies to improve
efficiency of
operating
Governments or
institutes roll out
new export stimulus
Institutes help
connect more
business
opportunities
Industries can assist
in resolving the
problems of supply
chains or human
resources
Others
Data sources: Surveys by Alibaba.com.
Note: Based on the OECD criteria, small businesses are enterprises with less than 250 employees.
Many small businesses turned to external resources in order to make it through the
pandemic. Governments and other major organizations around the world worked
hard to accommodate businesses to help them stay afloat.
The various types of aid helped to shape the business landscape to create more
favorable conditions for B2B traders.
Among all of the respondents, the most popular expectation for future support is that
platforms, such as Alibaba.com, continue to offer accommodations and policies to
improve the efficiency of business operations. In fact, nearly half of the respondents
had this opinion.
Digital B2B Outlook 2023
30
B2B Ecommerce in time of instability
The other half of the responses were split almost equally. They stated that their expectations
for future support were focused heavily on government organizations, industry leaders, and
other institutions. The results were proportionate when the respondents were broken down
by size.
These expectations include export stimulus programs from governments and other
institutions, assistance in resolving the problems of supply chains or human resources, and
connection facilitation from institutions to create more business opportunities.
Conclusion
Although the effects of the pandemic are lessening with time and most of the world
is operating as normal, the lessons we’ve learned throughout this global crisis will
stick with businesses for generations to come. Many small businesses have faced
tremendous hardships, but the experience has left them better equipped to navigate
tough situations moving forward.
If one positive has come from this situation, it is the shift towards e-commerce in B2B
trade. With the digitalization of B2B trade comes brand new opportunities for buyers
and sellers from around the world.
Digitalization makes trade more accessible and affordable since businesses can
connect over the internet without having to travel to tradeshows and other events.
Plus, with the support of Alibaba.com, global B2B trade is easier than ever.
References:
1
https://www.bigcommerce.co.uk/articles/B2B-ecommerce/B2B-ecommerce-trends/
2
https://www.abfjournal.com/articles/how-companies-are-cutting-costs-during-the-covid-19-pandemic/
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Digital B2B Outlook 2023