Materials maker Covestro AG is all in on Alibaba.
The firm on April 23 opened an online store selling its high-end plastic materials on 1688.com, an online platform operated by Alibaba, the Chinese internet giant.
1688.com is the biggest online business-to-business (B2B) marketplace in China, officials with Leverkusen, Germany-based Covestro said in a news release. Covestro's presence on the platform is designed to offer products for small and medium-sized customers, they added, and to help Covestro listen and learn to adapt to customers' needs.
The first group of around 50 Covestro products available under the link covestrochina.1688.com includes polycarbonate. A second wave will include pre-products for polyurethane foams, coatings and adhesives. Covestro expects that new forms of online commerce will contribute up to 1 billion euros ($1.2 billion) through the end of 2019.
"Digitalization rapidly changes customer needs and preferences and offers new business opportunities, especially in the fast growing Chinese economy," Covestro chief commercial officer and incoming CEO Markus Steilemann said in the release.
"For us, China plays a more and more important role, not only in terms of market size, but also with regard to innovation in relevant markets and technologies," he added. "With the launch of an online store on Alibaba we follow our strategy by innovating our business models in close cooperation with our customers."
Officials added that, with a maximum quantity order, the flagship store is more tailored to the needs of small and medium-sized customers. As a result, transactions will be of relatively small volumes.
"We need to be where the customers are and will be," Covestro executive Xiaobin Zhing added. "1688.com is that place." Zhong serves as Coatings, Adhesives and Specialties commercial head for the firm in the Asia Pacific region.
Covestro employs more than 16,000 worldwide and posted sales of 14.1 billion Euros ($17.1 billion) in 2017 in specialty plastics and chemicals. The firm operates a North American headquarters in Pittsburgh.
