Hugo Exclusive|Rollover Warning!The dimensionality reduction and crackdown mentality does not work in cross-border e-commerce

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Li Chun, co-CEO of DHgate, graduated from Peking University and has served as a platform executive of Lazada, Alibaba B2B, PayPal, eBay and other platforms. He has been deeply involved in the overseas industry for many years, and has deep insights and forward-looking judgments on industrial development, profound R&D accumulation, and innovation and growth experience leading multinational companies.

"Cross-border e-commerce platforms are becoming more and more competitive, and the better things are for sellers, the more they can take off by seizing the opportunity. "China's manufacturing and supply chain have significant advantages, and overseas enterprises should make full use of this advantage, resist the temptation of short-term profits, base themselves on long-term business development, and promote high-quality products to the international stage." ”

He further suggested that cross-border sellers should not only focus on the B2C market when going overseas, but should take advantage of the huge potential of the overseas small B market, which will bring broader development space and market opportunities for enterprises.

Here's an edited conversation:

01Does the highest technology determine the highest value?

Boss Talk: What was the most important turning point in your career?

Chun Li: I enjoyed the process of learning in each position, and there were two unforgettable experiences that had an important impact on my subsequent career development:

The first turning point was in 2000, when I had been working overseas for almost a decade and decided to return to China to start my own business. Prior to this, the experience of working in companies that generate business value based on technology empowerment has also been quite successful. At that time, there was a strong perception that technology is everything, and the highest technology can bring the highest value. However, in the process of starting a business after returning to China, I gradually realized that business success does not only depend on the most advanced technology, but should start from the needs of the market and users, and find the most suitable technical solutions. I am a person who is very fond of technology and willing to delve into it, and this shift has also led to a deeper understanding of the relationship between business and technology, and has influenced subsequent career choices and development.

The second turning point was when he joined Alibaba and worked for 3 years in charge of Lazada's technology product upgrades and integrations. After successfully completing the technical transformation, it is a very pleasant experience to try to enter a new and more challenging business management field.

Boss Talks: How did you feel about the change from a technical leadership position to a CEO management role?

Chun Li: There are a lot of advantages to moving from a technology leader to the business, especially in the digital economy, which places more emphasis on logical and data-driven decision-making, which is very similar to the way technology leaders used to work. Technology leaders are accustomed to working hard to deliver high-quality results with identified needs, and this mindset and technical background are often easier to adapt and succeed in the digital economy.

Technology leaders are often proven to be able to get things done efficiently and with high quality. This ability to execute is equally important in the digital economy, as it involves turning ideas into actual products or services. While technology leaders are accustomed to dealing with deterministic tasks, the business world is fraught with uncertainty, and successful business leaders need to be able to make judgments in a volatile environment and continually adjust strategies based on the results of execution.

As a CEO, you not only need to deal with a variety of people, including technical staff, product personnel, marketing, legal affairs, and finance, but also motivate your team and participate in public speaking. In addition to this, empathy and business acumen are required, which includes an understanding of users, partners, and a grasp of the essence of the business. These abilities help to make better decisions in situations of uncertainty.

Boss Talk: What are some of the most important influences on your career from studying at Peking University and The Ohio State University?

Li Chun: University education is not only about the learning of professional knowledge, but more importantly, the cultivation of basic personal qualities and the formation of thinking patterns.

After working in China for 4 years, I went to the United States for graduate school with practical work experience, which made me more clear about my learning goals in the learning process, able to absorb and apply new knowledge faster, and laid a solid foundation in computer science. Although the study experience at Peking University was not directly related to later programming work, the life during that time had an important impact on the way of thinking and long-term development in the career.

Boss Talks: How do you maintain a good work-life balance after your busy work?

Li Chun: I'm not a person who pushes myself to the extreme at work, but I do have a lot of interest and enthusiasm for my work, and this enthusiasm doesn't feel particularly painful or complaining even when it requires a lot of input. Love for work is an important factor in maintaining a work-life balance.

While there are times when it takes a lot of time and effort to work at work, it's not healthy to keep it that way for a long time. In my spare time, I de-stress through recreational activities such as yoga and golf.

If you enjoy your job, then the stress at work will also be easier to handle. Young entrepreneurs, don't treat stress as a purely negative thing, but as a motivation and challenge. This positive mindset can help maintain a good mindset and life balance during a busy work schedule.

02 "It's the worst to just listen to PPT presentations"

Boss Talk: You've worked for Lazada, Alibaba B2B, PayPal and eBay, could you describe the style of these companies in one keyword?

Li Chun:

eBay是“people are basically good”，对商家、用户和员工都非常友好和nice。

Alibaba B2B is a "mission must be achieved", this is a very affectionate and righteous team, the company's success in the early difficult business model depends on the team's joint efforts and persistence.

Lazada is a platform for "diversification", which was founded by Europeans with an American business model, operates in Southeast Asia multiculturally, and was later acquired by Chinese internet companies.

PayPal has an "innovative and adventurous" spirit and is not much different culturally from eBay.

Boss Talks: How do these styles influence your leadership in DHgate?

Chun Li: No matter which company you work in, you have the opportunity to learn new knowledge, skills, and ways of working. I believe that leaders should have their own persistence and nature, even in different circumstances, they should play to their strengths and solve problems in combination with specific situations. This means that leaders should be able to adapt their strategies to the actual situation, rather than simply copying past experiences.

I am a person who likes to learn and think, draw from different company cultures and work environments, and think about how to apply those experiences to new situations. As a B2B e-commerce platform, DHgate has its own unique business model and market environment, so it is necessary to combine the specific situation of DHgate, give full play to its own advantages, and create strategies and solutions suitable for DHgate.

Boss Talks: As a co-CEO, how do you balance strategic planning with day-to-day operational needs?

Li Chun: First of all, clarify the company's long-term goals. This includes understanding the company's ultimate vision, the customer base it serves, and the maximum value the company provides, all of which help the team build a common understanding and work in the same direction. Once the long-term goals are defined, leaders need to work with the team to develop a strategic path to achieve those goals. This path should be continuous, not set in stone, but based on a correct understanding of the company's current situation and available resources.

Second, there needs to be a balance between strategic planning and day-to-day operations. Strategic planning should guide day-to-day operations, but feedback from day-to-day operations should in turn validate and adjust strategic planning. After developing the strategy, the leader should empower the team to execute the strategy and develop a specific execution plan and methodology within the strategic framework. This allows the team to have more autonomy while also making better use of the expertise and knowledge of the team members.

Furthermore, the team may encounter challenges and difficulties during the execution process. As a leader, you need to identify which are the key issues and bottlenecks and use your experience and knowledge to solve them with your team. It is worth mentioning that leaders should avoid falling into a situation where they only listen to PowerPoint presentations without understanding the actual situation. Leaders need to be hands-on and face real-world problems with their teams to ensure that strategy is closely aligned with reality.

Finally, leaders need to constantly learn and adapt. Through real-world problem solving, leaders can validate and optimize strategic planning to ensure that the company can continue to move forward.

03 Don't just stare at the 2C volume, make good use of the overseas small B, the sea and the sky

Boss Talks: You have both cross-border to B and to C experience, why did you choose the B side now?

Chun Li: In his early career, he has been engaged in enterprise software and supply chain related work, and has a deep emotion and interest in using technology to solve B-end problems. With the continuous progress of Internet technology, especially the development of emerging technologies such as AIGC and blockchain, these technologies have brought new possibilities to the B2B field, and will further solve the B-end business problems that the Internet has failed to solve in the past. Compared with the B2C field, the B2B industry is likely to have more room for added value driven by new technologies.

Boss Talks: Where do you think the potential breakthrough points and opportunities of the B2B model in the current market?

Li Chun: To find the breakthrough point of the B2B model, we first need to understand the pain points of users. Each B-end enterprise has its own unique needs and challenges, so it is necessary to dig deep and solve the pain points of these key nodes for different industries and business scenarios.

With the development of new technologies such as artificial intelligence (AI), blockchain, etc., B2B platforms can leverage these technologies to solve problems that the internet has failed to solve in the past. New technologies can help businesses deal with supply chain, logistics, finance, and other challenges more effectively.

In the past, when talking to B2B teams, it was common to mention that there were a lot of things that were necessary but not sufficient. In fact, B2B platforms need to be deeply rooted in the industry, using modern technology and operating models to provide more accurate and effective solutions according to the needs of specific industries. This requires the platform to not only understand the common problems of the industry, but also solve the specific difficulties faced by each enterprise.

It is worth noting that the rise of social e-commerce has brought new opportunities for the B2B model. If Chinese brands want to go overseas, they can use overseas influencers to carry out live streaming or video promotion. This B2B model, which combines social networking and e-commerce, can help businesses better showcase their products and brands while improving sales efficiency.

In addition, B2B platforms can also learn from the successful experience of B2C e-commerce in the fields of supply chain, logistics and finance, and provide more efficient services by integrating resources and technologies.

Boss talks: It is observed that major cross-border e-commerce platforms have made frequent moves in overseas business, such as 1688's entry into cross-border business, Amazon's opening of the industrial belt to the sea, and so on. In this regard, how does DHgate create its own advantages?

Li Chun:

On the one hand, focus on specific scenarios, such as social e-commerce, online celebrity e-commerce sellers, or the procurement needs of small businesses. At the same time, it provides a series of professional services, including buyer services, front-end one-click dropshipping services, and FOB-based financial logistics services.

On the other hand, to maintain neutrality, unlike other large platforms, DHgate has always maintained neutrality when serving these small B merchants for multi-channel operations, and will not force merchants to choose one or three choices. DHgate supports merchants to sell on Amazon, TikTok, or other channels, rather than restricting them from operating on a specific platform. These strategies allow merchants not to worry about being forced to choose between different platforms because of using DHgate's services, thus building long-term trust and partnerships. At the same time, it can further establish its own brand and expand its market influence.

Boss Talks: You mentioned that DHgate will strengthen the acquisition of Class B customers in the new scenario, can you elaborate on the direction and plan of this strategy, and what is the innovative strategy in the field of logistics and payment?

Li Chun: DHgate sees social e-commerce as an important growth point, especially in the business area of MyyShop. With the continuous development of the platform, DHgate is not only strengthening its back-end capabilities, but also improving its front-end ability to acquire customers. This two-way enhancement will help solve the "chicken and egg" problem, that is, to provide quality service while also being able to attract more customers to the platform.

Payment: DHgate not only provides traditional collection services, but also innovatively launches payment services to meet the needs of merchants in different scenarios. This one-stop payment solution improves the efficiency and security of cross-border payments by integrating multiple payment methods and financial services.

Logistics services: By accelerating the digital transformation of cross-border logistics business, and cooperating with high-quality third-party logistics, combined with its own investment, we will provide users with a better logistics experience. DHgate has established warehouses overseas and launched a dropshipping service. This kind of logistics service innovation from the B-end to the C-end effectively solves all the logistics problems from the big B-end to the small B-end to the C-end.

Boss Talks: How do you see the strategic position and synergy between the B2B cross-border e-commerce platform DHmogo and the social e-commerce platform MyyShop in DHgate?

Li Chun: DHmogo focuses on providing fulfillment solutions based on the FOB model for both parties in the B2B field, while MyyShop focuses on the social e-commerce field and provides the ultimate B2B2C service for overseas influencers.

The B2B marketplace served by DHmogo and the social e-commerce marketplace served by MyyShop are different, but they can complement each other and jointly develop a wider customer base. In the long run, the innovative business model of the two platforms will help DHgate explore new growth points and bring new vitality and inspiration to traditional businesses, with great potential.

Boss Talks: How does DHgate build and maintain long-term relationships with B2B customers?

Chun Lee: In a B2B relationship, trust is crucial. For the platform, the first focus is on creating value for the customer, which means that the customer's real problems need to be solved. Before talking about user experience, we must pay attention to user value. Only when customers realize that they can obtain substantial business value through DHgate, they will choose to continue to cooperate.

Different from the more emotional B2C users, while the B2B users are relatively rational and the user group is relatively concentrated, word-of-mouth in the industry is crucial to the long-term cooperation of enterprises. At present, the value generated by B2B and customer relationships is relatively thin, and DHgate has been committed to continuously making valuable businesses, such as DHmogo and MyyShop, to adapt to market changes and the evolution of customer needs, so as to establish a solid cooperative relationship in the long term.

Boss Talks: What new development trends do you think may emerge in the B2B cross-border e-commerce field in the next few years?

Li Chun: As the market continues to segment, more vertical and specialized B2B solutions and platforms will emerge. These platforms will focus on specific industries or fields, provide more accurate and professional services, and meet the individual needs of customers in specific industries.

At the same time, technologies such as artificial intelligence, big data analysis, and blockchain will play a greater role in B2B cross-border e-commerce, improving the efficiency of supply chain management, optimizing logistics and warehousing, and improving the transparency and security of transactions.

04 "It's dangerous to do maritime business with the idea of dimensionality reduction!"

Boss talks: In the past two years, cross-border e-commerce companies with annual sales of more than 10 billion US dollars have been running out of the industry. Why is this so hot, and where do these results fit overseas?

Li Chun: In overseas markets, some cross-border e-commerce companies have achieved remarkable results, and it is not uncommon for companies with annual sales exceeding 10 billion US dollars. These companies have occupied an important position in the international market, especially on large e-commerce platforms such as Amazon, and the sales volume of top sellers is very high.

Despite the increasing scale of leading enterprises, consumers still have high requirements for the uniqueness and diversity of products. This means that there is still a lot of room for development in the cross-border e-commerce industry, especially for cross-border enterprises that can provide personalized and innovative products. The growth of social commerce is expected to help balance the market, providing merchants with more diverse and rich choices, while also providing consumers with a more personalized shopping experience.

Boss talks: There is a voice in the industry that the experience and technology of Chinese companies in the mobile Internet era are ahead of overseas, such as mobile payment, social e-commerce, etc., so going overseas is a dimensionality reduction attack. Do you agree with this statement?

Li Chun: This view has a certain degree of reasonableness, but it also has certain limitations. Chinese e-commerce companies have indeed accumulated a wealth of experience in the fierce competition in the domestic market, including efficient operating models, advanced technology applications, and a deep understanding of consumer behavior. To a certain extent, this experience and technology provide a competitive advantage for Chinese enterprises to go global.

However, the idea of simply treating these advantages as a "dimensionality reduction strike" is rather dangerous. When entering overseas markets, Chinese companies need to face challenges such as a new market environment, consumer habits, laws and regulations, and cultural differences, all of which may affect the company's success. Therefore, even companies with advanced technology and extensive experience need to conduct in-depth research on the local market and build a partnership with the local ecosystem to be truly successful.

In addition, simply translating successful models from home to overseas markets can be risky. Each market is unique and requires a customized strategy and localization. Therefore, Chinese companies should maintain a humble and learning attitude when going overseas, and avoid complacency and blind confidence.

Boss Talks: As a leader with a technical background, how do you see the impact of AI-generated content (AIGC) technology on the cross-border e-commerce industry?

Li Chun: AI technology is at an important level of change. The emergence of computer technology has solved the problem of data storage and computing power, made complex calculations possible, and laid the foundation for subsequent technological development; the emergence of Internet technology has connected information islands, enabling information to circulate within the whole society, greatly improving work efficiency and social operation efficiency, and also giving birth to a series of successful Internet companies.

The development of AI technology, especially AIGC technology, enables data to not only be stored and connected, but also effectively used and transformed into productivity, further improving work efficiency and innovation capabilities.

The impact of AI technology is likely to outweigh the first two, as it enables businesses of all sizes to access and leverage AI, driving deep adoption and development across industries. The emergence of AIGC technology is similar to the role of PCs to computers and browsers to the Internet, making AI technology more popular and easy to use.

It is foreseeable that the next few years will see more innovative and successful companies emerge based on the foundation of AI technology. Today's NVIDIA could be the Cisco and Intel of the past, and today's AIGC technology could be the Netscape of the past.

For the cross-border e-commerce industry, the application of AI and AIGC technology can help enterprises better understand consumer needs, optimize supply chain management, and improve customer service experience, so as to stand out in the fierce market competition. At the same time, companies also need to pay attention to the privacy and security issues that AI technology may bring about to ensure the responsible use of technology.

Boss talks: What are the full sets of mature AI solutions that DHgate has developed in the application of AI technology?

Li Chun: The solution covers a number of key business areas, from search and recommendation, to intelligent logistics, risk control, marketing and other fields. Based on the fine-tuning of the open source large model, a professional large model suitable for the B2B cross-border e-commerce industry was developed, which solved some difficulties in the application of the general large model in Class B, such as the real-time and accuracy of information.

In addition, DHgate also uses AI to generate video content, improves the efficiency of Internet celebrity operations, and uses AI technology to carry out digital human live broadcast and bot shopping guide, which enhances user interaction and shopping experience.

05 "Get the best out of the way, even at the expense of short-term profits"

Boss Talks: What are the key development goals and milestones of DHgate in the next few years?

Li Chun: DHgate is committed to providing better services, including improving user experience, optimizing customer service processes, enhancing user interaction and engagement, and increasing repeat purchase rates. In terms of innovative business, DHmogo and MyyShop will achieve a certain scale of business development and reach a broader market space, so as to help Chinese brand merchants go overseas more effectively, and support the business growth of overseas small and medium-sized B buyers.

DHgate hopes to maintain and strengthen its leading position in the cross-border e-commerce sector, especially in the application of AI technology. Leverage AI to improve operational efficiency, optimize supply chain management, enhance personalized marketing, and product recommendations. We strongly believe that AI technology will be a key driver for future growth.

Boss Talks: Finally, what advice and messages do you have for entrepreneurs who want to succeed in the field of cross-border e-commerce?

Li Chun: China's manufacturing and supply chain have significant advantages, and the products produced are recognized by overseas markets in terms of quality and innovation. Entrepreneurs should take full advantage of this advantage and bring high-quality products to the international market.

In addition, entrepreneurs should resist the temptation of short-term profits and focus on long-term brand building and business development. This may mean sacrificing short-term profits, but in the long run, such an investment will lead to a larger market share and more stable earnings for the business.

Cross-border e-commerce is a long-term process, which requires patience and perseverance to face market challenges and changes, while continuing to pay attention to new trends in the industry and adjust strategies in a timely manner.

Text/ Hugo Cross-border Chen Lin Cover/Hugo Cross-border