Somewhere around 600 million people live in the Chinese countryside, and Alibaba has spent years trying to turn them into customers. The problem is, while e-commerce has been exploding in China’s urban areas, the logistical challenges of shipping products to rural areas, as well as the lower rate of internet usage in those areas, has made it difficult to tap into that vast pool of potential customers. That’s why Alibaba has joined forces with the Communist Youth League to train one million teenagers how to bring e-commerce to rural areas, and has set aside $154 million to support college graduates who want to return to their rural homes and establish their own e-commerce business.
Strengthening ecommerce in rural areas has been one of Alibaba’s goals for years now in helping to expand its domestic market. Now, Chinese official state media outlet Xinhua announces, the company has a new partner in that venture: the Communist Youth League. According to Xinhua, Alibaba will work with the Communist Youth League to train one million teenagers on how to bring ecommerce into rural areas. Funding will also be available; Alibaba financial arm Ant Financial has set aside US$154 million to “support” college grads who want to return to their rural hometowns and set up ecommerce businesses. (It’s not clear whether that money will distributed in loans, grants, or some combination of the two). 45 percent of China’s population – some 600 million people – still live in the countryside, and ecommerce has spread there far slower than it has in China’s cities. There are a number of reasons including logistical challenges (some rural locations are difficult to ship to) and lower computer and internet usage rates. At present, in many Chinese villages “ecommerce” is a physical shop you can go to set up by an ecommerce company (like Alibaba or JD) that will help you buy and sell products online without needing internet access, your own epayment account, or any real computer literacy.