Tuesday, May 21, 2024

Alibaba said to invest in South Korean women’s clothing app operator Ably

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AliExpress, the international online retail platform of Alibaba, has been in talks to invest US$72.4 million to acquire a 5 per cent stake in Ably Corp, operator of South Korea’s top women’s shopping app, according to a report on Monday by daily newspaper The Korea Economic Daily, which cited banking sector sources.

Alibaba, owner of the South China Morning Post, and Ably did not immediately respond to a request for comment on Tuesday.

A successful investment in Ably would enable Alibaba to gain a bigger foothold in South Korea, where AliExpress, Shein and Temu compete against major domestic retail platforms such as Gmarket and Coupang.
Alibaba Group Holding’s AliExpress is one of the fastest-growing online retail platforms in South Korea. Photo: Shutterstock

The Ably shopping app, currently valued at more than US$1.5 billion, has grown to become the largest in terms of user accounts in Korea’s online fashion arena, with 8.05 million monthly active users in March, according to local mobile intelligence firm Wiseapp. Ably has said in local reports that it was the only fashion e-commerce platform to be profitable last year.

Alibaba will spend US$200 million this year to build a logistics centre and US$100 million to help small- and medium-sized firms on the peninsula to sell their products overseas, according to South Korean media outlet Yonhap News Agency, citing a business strategy document from the Chinese company.

Ably Corp’s South Korean fashion e-commerce platform, currently valued at more than US$1.5 billion, had 8.05 million monthly active users in March. Photo: Handout
Founded in 2018, Ably started as an online marketplace used by bricks-and-mortar vendors at Dongdaemun Market, a bustling shopping and tourism area in the Jongno District of Seoul, capital of South Korea.

Ably’s growing domestic market share in online sales of women’s garments appears to fit the strategy of AliExpress, which has launched a dedicated women’s apparel channel on its global platform.

According to The Korea Economic Daily report, Alibaba has been exploring investment opportunities in various local lifestyle e-commerce players since 2020. These include the likes of 11Street, Tmon and W Concept Co. AliExpress, which launched in South Korea in 2018, saw its monthly active users surpass 7 million as of last November, according to Wiseapp.
Chinese merchandise has been gaining traction among South Korean shoppers, with online consumption last year rising 121 per cent to 3.3 trillion won from a year earlier, according to a Reuters report citing official data. That made up nearly half of the country’s total overseas e-commerce purchases, the report said.

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