This is a big deal
Alibaba, the Chinese e-commerce giant that's bigger than Amazon and eBay combined, is quietly entering the U.S. market today. Called 11 Main, the company's U.S. website is starting off as an invite-only storefront featuring roughly 2,000 upscale items from American specialty shops and boutiques.
Analysts see the store as a small, but significant step in Alibaba's attempt to gain a foothold in the lucrative American marketplace. "U.S. e-commerce is crowded and relies on high marketing expenses to rise above the clutter," Forrester analyst Sucharita Mulpuru told AP. "We'll see if they live up to expectations."
Since 11 Main doesn't have ads, it plans to make money by taking a 3.5 percent cut of each transaction. In return, retailers will get access to the company's "national marketing power and reach." The opening comes as Alibaba is prepping for what is expected to be a massive IPO. In the last three quarters of 2013, the powerhouse generated $6.5 billion in revenue and is expected to raise up to $20 billion when it eventually files later this year.