To find out how Alibaba Group Holding is pulling out all the stops to lead Southeast Asia’s e-commerce market, check out who is in command of its US$4 billion flagship enterprise in the region.
Lucy Peng Lei, one of the 18 co-founders of Alibaba and the former head at affiliate Ant Financial Services Group, was named last week as the new chief executive at Southeast Asian e-commerce company Lazada Group.
Her appointment followed Alibaba’s investment of an additional US$2 billion in Singapore-based Lazada, in which the Chinese e-commerce giant had previously poured US$2 billion to take an 83 per cent shareholding. Alibaba did not reveal its current stake.
For the 45-year-old Peng, who also serves as the executive chair at Ant Financial and chairwoman at Lazada, her mission is clear: accelerate Alibaba’s expansion in the region.
Chinese technology companies see a huge new market in Southeast Asia. It consists of 11 countries with a total population of 653.4 million, about 49 per cent of whom live in urban areas, according to the latest United Nations estimates.
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The region is also home to more than 370 million internet users as of January this year, according to a recent report by We Are Social and Hootsuite. With most internet users going online with their mobile devices, as well as a growing middle class eager to spend money online, Southeast Asia represents a lucrative region for e-commerce activity.
Southeast Asia’s total e-commerce revenue is forecast to exceed US$25 billion by 2020, according to business consulting firm Frost & Sullivan. It said the region’s largest online retail markets are currently Malaysia and Thailand.
“With a young population, high mobile penetration and just three per cent of the region’s retail sales
currently conducted online, we feel very confident to double down on Southeast Asia,” said Peng in a statement after her appointment at Lazada.
Peng, who was ranked 34th by Forbes in its “World’s 100 Most Powerful Women” list, is recognised as one of China’s most powerful businesswomen, along with Alibaba chief financial officer Maggie Wu Wei.
Peng’s storied professional career includes the role of chief people officer at Alibaba from June 2014 to April 2016. She presided over significant personnel growth at the Hangzhou-based company, which increased the number of employees from over 22,000 in 2014 to more than 36,000 at the end of its 2016 financial year.
Before that, Peng served as the head of Alipay, overseeing the growth of that business into one China’s leading online payments platforms today.
Paul Haswell, a partner at international law firm Pinsent Masons, said Peng’s well-rounded experience gives her an advantage in driving up e-commerce activity across Southeast Asia.
“I think we can expect her to both push Lazada to the growing middle class consumer market in Southeast Asia, as well as use Lazada as an entry point for Alibaba’s other offerings, not the least of which includes financial services,” said Haswell.
Still, Peng and Lazada are facing stiff competition in Southeast Asia’s e-commerce market. Alibaba’s mainland online retail rival, JD.com, has already set up major e-commerce ventures in Indonesia and Thailand. In January, JD.com invested an undisclosed amount in Vietnamese e-commerce firm Tiki.vn, which also has a large warehouse and logistics operation.
In July last year, US e-commerce giant Amazon.com made its long-awaited foray into Southeast Asia by launching its subscription Prime Now service in Singapore. The service allows members to place orders for items from a local and international selection of products.
Ride-hailing service Grab has also recently expanded to providing loans and lending services in Southeast Asia, a move to counter the steady expansion of Alipay and Tencent Holdings-backed WeChat Pay in the region.
Alibaba declined to make Peng available for an interview.
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While she continues to play an important role in Alibaba today, Peng’s professional career started from humble beginnings.
Like Alibaba founder Jack Ma Yun, Peng began her career as a teacher. She taught at the Zhejiang University of Finance and Economics after obtaining a degree in business administration in 1994 at the Hangzhou Institute of Commerce (now known as Zhejiang Gongshang University).
In 1997, she married Sun Tongyu, before quitting teaching in 1999 to join her husband as part of the 18-strong Alibaba founding team.
“For most of the time, it was Ma who was waving his hands and saying that we must build the most successful internet company in the world, by a group of Chinese,” Peng was quoted as saying in the book Chinese Women Business Leaders: Seven Principles of Leadership, as she described the first meeting they had with Ma.
Peng started with a monthly salary of just 500 yuan, and admitted to feeling “confused and uncertain” about how to make Alibaba a great company, according to the book.
Alibaba employees described her as low profile, preferring to stay out of the public eye, although her down-to-earth and adaptable nature have helped her shine in various roles in the organisation.
For more than 10 years, Peng worked in human resources at Alibaba, before becoming its chief people officer in 2014 and part of the Alibaba management team.
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She is known for setting up the “mom and pop” managing model in Alibaba teams, where a “mom” executive would be in charge of promoting teamwork and passion, while the “pop” executive assessed performance, according to the book Women in Leadership: Contextual Dynamics and Boundaries.
From January 2010 to February 2013, Peng served as the chief executive of Alipay. She helped lead the online payments service through its meteoric rise to become one of China’s leading third-party payments services.
She then took on the role of chief executive at Ant Financial, where she came up with products such as Yu’e Bao – the world’s largest money markets fund, with more than 1.5 trillion yuan (US$228 billion) of assets as of September last year. Ant Financial is estimated to have a valuation of about US$75 billion today.
In 2014, Peng became a billionaire from her stake in Alibaba, which was valued at US$167 billion ahead of its initial public offering in the New York Stock Exchange. Forbes has estimated her current net worth at US$1.14 billion.
Alibaba owns the South China Morning Post.
