Alibaba and Amazon have been locked in a seemingly endless tug of war for e-commerce supremacy since the late 90s. Both companies have managed to carve out a chunk of the global market in spite of each other, and both have achieved incredible success. However, Alibaba has developed an obscure reputation — among shoppers from anywhere not named China — as a hub for counterfeiters and scammers. We have the facts behind some bad Alibaba reviews to help you make well-informed purchases in the future.
First Things First, What is Alibaba?
Alibaba is one of the largest e-commerce companies in the world. This Chinese titan dominates China’s consumer retail industry, and, unlike Amazon, Alibaba doesn’t own the inventory of the merchandise sold. Basically, the platform only focuses on connecting buyers and sellers together.
Alibaba is divided into 3 core businesses:
- Alibaba – Launched in 1999. It connects manufacturers from China, India, Pakistan and the U.S. with international buyers. Merchants can list their products for free on the platform, or pay for special features to obtain greater exposure. *AliExpress – It is an online marketplace where U.S. buyers can make purchases from manufacturers and retailers. There are no minimum order requirements, but products are sold at slightly higher prices.
- Taobao B2C (Business to Consumer) – Launched in 2003. It is considered China’s largest shopping website. It lists hundreds of millions of products, allows merchants to list their products for free, and it doesn’t charge transaction fees. It caters to small merchants and individual sellers.
- Tmall – Launched in 2008. It focuses on larger companies and multinational brands, such as Nike and Apple, and offers a wide range of products oriented towards China’s growing middle class. Gold members must pay a security deposit (up to 25K), plus annual seller fees (10K), and give Alibaba a 2-5% commission on each sale.
These e-commerce websites allow Alibaba to act as a middleman, facilitating the exchange of goods and services.
Source: Investopedia
Is Alibaba Safe?
Alibaba Review No. 1
“The mediation of Alibaba is not working and the insurance not protect buyer. So i have many bad other experiences, like when you cancel a product, they don’t totally refund you and keep 5% of your money. They FOOL PEOPLE. I have videos, photos, to show everything.”
Trustpilot
Fact No. 1
Let’s clear the air.
Alibaba helps shoppers meet manufacturers.
Practically, ANYONE can sell almost ANYTHING on the platform and this could be one of the reasons why it is not as trusted as Amazon.
Truth is, many won’t even try to buy on the platform, let alone do business.
Unlike Amazon, shoppers can hold direct communication with manufacturers, and they can even ask for product customization.
Considering that merchants can list their products for free on the platform and that the platform houses thousands and thousands of sellers, it is almost impossible to run a thorough scan of each one of them to ensure their reliability. This is why transactions can get a bit iffy.
Alibaba has been trying to fight this problem for a while now.
That said, selling on the platform isn’t unsafe, you just have to be extra careful.
Alibaba and Amazon’s Counterfeit Problem
Alibaba Review No. 2
“A seller from the platform sent me rusty kiosk and used device. I pay for new merchandise, they send me olds.”
Trustpilot
Fact No. 2
It is no secret that both Alibaba and Amazon have a notorious counterfeit problem.
The U.S. Government of Accountability Office found in 2018 that two out of every five products purchased online was counterfeit. Late April 2019, President Trump signed a memorandum pledging to curb the sale of counterfeit goods online from Alibaba, Amazon, and other platforms.
In 2017, Alibaba was suspended from the International Anti-Counterfeiting Coalition (IACC). This led the company to form its own anti-counterfeiting alliance, in its efforts to win the trust of the industry and its consumers. This alliance includes valuable consumer brands such as Disney, Apple, and Starbucks.
In 2018, Amazon spent more than $400 million to combat counterfeits, and more than once has sued its own third-party sellers for selling fake goods.
Alibaba’s counterfeit problem has more exposure and relevance since China is the world’s leading exporter of manufactured goods. Also, the Chinese super-giant is able to list more products than Amazon, and the expansion into new markets is easier due to its cost-friendly policies.
The Chinese titan has dedicated millions to rooting out unethical sellers from the platform. Mid-2019, Alibaba released their Intellectual Property Rights Report, stating the following:
“…The company has “developed best-in-class systems to protect [intellectual property] and battle the scourge of counterfeiting,” and looks forward to “further advancing the working relationship and cooperation with the US federal agencies mentioned in today’s order, as well as with our global commerce peers…”
Jing Daily
Related post: How to Source Products From Alibaba to Sell on Amazon
Prolonged Shipping Periods
Alibaba Review No. 3
“I pay a lot for delivery. Waiting. Big delay. And when they are ready, prices are changing and additional cost for delivery.”
Trustpilot
Fact No. 3
While Alibaba can be a cost-effective option for small businesses, selling on the platform can still represent some drawbacks, for example:
- Consumer skepticism
- Language interference (most of the manufacturers on Alibaba are Chinese)
- Prolonged shipping periods
Yet, there’s a workable solution for the latter.
Drop-shipping is a type of contract you sign with a seller who agrees to store, manage, and ship your products to end consumers on your behalf. It’s pretty similar to the way Amazon FBA works. There’s a slight difference, however. You are not required to pay for warehouses fees.
If you are a new comer, Drop shipping could be a feasible solution to your order-fulfillment problems.
Just keep in mind that most sellers fulfill bulk orders, and individual orders can be extremely costly.
Refunds
Alibaba Review No. 4
“I purchased a few beauty devices on this platform and they arrived not working. I contacted the supplier directly, sent videos of the items not switching on and he agreed to refund me. It’s been a month and no refund. When I message the seller, he reads my messages but does not respond.
Trustpilot
The seller is swiss. DO NOT get involved with them. Alibaba is not helping at all in this regard as well. I sent various emails with no response. Worst platform ever.”
Fact No. 4
Upon review of each case, Alibaba will generally submit a refund within 7 working days once the shopper and the supplier have reached a refund agreement.
If the supplier is not replying to the shopper’s messages, the shopper may contact Alibaba’s Live Chat service to submit a claim.
However, it is important that you keep in mind that Alibaba does not take part in this negotiation. Therefore, refunds can take months to be resolved.
Closing Thoughts
The information provided by customers about whether they are satisfied or dissatisfied with a product or service must be considered as crucial for any business that is striving to improve their customer service practices.
And the fact that customer reviews are now there for all to see, makes it harder for companies to keep up with customer demands.
Alibaba is one of those e-commerce platforms in which you might find a couple of nice reviews among a sea of not-so-positive ones. Unfortunately, many shoppers take a dive into the Alibaba platform hoping to find great deals without considering the implications that this may entail.
While counterfeiting is a major problem that many e-commerce platforms face nowadays, this does not mean that Alibaba itself is a scam, you just have to be extremely careful when buying on the platform.
If you’d like to sell your products online, following a customer-centric approach, or wish to consider other options that make sense for your business capabilities and marketing plan, contact us, we have the best option for your new project or business needs.
