Alibaba’s Vice Chairman To Lead Its Offline Focus

With a massive investment last month in Koubei, Alibaba and Ant Financial made it clear that the companies were serious about the online-to-offline market.

So serious, in fact, that Alibaba and Ant Financial, the maker of Alipay, are betting big and investing almost $1 billion in a joint venture called Koubei.

And now Alibaba has tapped one of its own to help lead that vision. Alibaba Vice Chairman Joseph Tsai has been selected to lead Koubei’s board to help the company boost its presence into the local services market, Bloomberg reported. Koubei is an expansion of Alibaba/Alipay’s mobile business that seeks to blend the real world and online shopping experience into a single, fluid, commerce event — mainly by focusing on restaurants and brick-and-mortar stores. On the platform, Ant Financial will provide merchants with tools.

The company confirmed Tsai’s role at Koubei via an email to Bloomberg and said he will still maintain his role as the vice chairman at Alibaba. Ant Financial’s Samuel Fan will serve as Koubei’s CEO. Alibaba and Ant Financial both have an equal stake in the company, with both owning half the company.

The online-to-offline market targets the trend in mobile commerce that has more consumers shopping online via mobile to buy physical goods and services. As Alibaba continues to focus on its mobile commerce growth, investing in the online-to-offline market has been a major focal point for the eCommerce giant.

O2O is a natural expansion of Alibaba’s mobile business, as it works to navigate the switch to a digital commerce environment dominated not by computers but by devices. O2O services allow Alibaba to capture the attention of shoppers wherever they are, whenever they are shopping. An Alibaba customer in a brick-and-mortar shop can look to the Alibaba app for discounts and promotions, use their Alipay Wallets for purchases or order goods from local stores for delivery.

Alibaba’s stake in Koubei also sets it up against Baidu and Tencent to compete in the local services market. According to figures provided by Bloomberg, that market is anticipated to grow to 7.28 trillion yuan ($1.17 trillion) by 2017.

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