Who is Behind the Exponential Growth of European Foreign Trade Orders?

Author | Jing Xing

Editor | Yang Zhou

"Our growth rate in the European market is exceptionally good, especially in France, where our order volume has surged to 3.6 times that of last year," Huang Ruihua, General Manager of Dimax Sporting Goods, told "Market Trends".

Amidst global trade turbulence, the robust growth of the European market stands out as a significant boon for all foreign trade enterprises.

On April 2, the United States wielded the tariff stick, imposing "reciprocal tariffs" on its global trading partners and announcing the termination of the exemption policy for small packages under $800, effective May 2. This triggered severe turbulence in global stock indices and commodity markets.

Unlike past U.S. tariff policies, Trump's latest tariff measure covers major global markets, including Vietnam, effectively blocking tariff avoidance routes. There are even rumors online that even the uninhabited "Penguin Island" has been subjected to a 10% tariff increase.

Amidst this tariff wave, the European market has risen swiftly, becoming a new growth hub for foreign trade businesses. "Market Trends" observed reports indicating that the order volume on Alibaba International Station, a global B2B cross-border e-commerce platform, surged in Europe in March, with France experiencing a remarkable growth rate of 125%. Some insiders on the platform commented: "France's growth has reached unprecedented levels."

The "Dimax Sporting Goods" mentioned earlier is a merchant on Alibaba International Station. They informed "Market Trends" that Europe, originally an established foreign trade market they had been operating in for years, has recently been growing on the platform like an "emerging market," with growth rates soaring into the triple digits.

Europe's unprecedented growth has provided reassurance to foreign trade businesses amidst the uncertainty of U.S. market policies. Today, we delve into the question, "Why Europe?"

"As early as last September, we received a million-dollar order from France on the international station. For us, the volume of new orders in the European market is very high. Besides France, the growth in the UK and Danish markets has also been impressive," said Huang Ruihua.

Similarly, "Market Trends" interviewed a wireless headset seller in Shenzhen who mentioned being overwhelmed with inquiries from Europe since the beginning of this year. Additionally, Zhieu Technology, a major seller of household products, mentioned to the media that the company's European revenue accounts for about 60% of its total revenue. This year, it will continue to consolidate its position in Europe, accelerate the launch of new products, and expand into new high-value categories, focusing resources on increasing expansion speed and gradually penetrating offline channels in Germany, among other strategies.

Europe is not an emerging market for the foreign trade industry, so what signals does its surge signify?

"Market Trends" attempts to observe from the perspective of Alibaba International Station. A review of past information reveals that Alibaba International Station has indeed made some advance layouts in Europe. Starting last year, it has heavily invested in the European Championship, the Paris Olympics, signed NBA basketball superstar Tony Parker, known as the "French Sports Car," and advertised extensively in airports, subways, and landmark buildings. However, the growth brought about by such investments is often linear. So, who is driving the current exponential, non-linear growth?

We have observed that AI is undoubtedly a core factor that cannot be ignored behind the surge in the European market.

Over the past two years, the progress of AI applications on Alibaba International Station has been rapid, almost revolutionizing its entire business. Currently, more than half of domestic sellers use Alibaba International Station's AI Agent daily. AI has automatically received buyers over 20 million times, increased the second reply rate of buyers by 35%, and boosted the payment conversion rate by 52%. The AI search tool Accio launched overseas has already acquired 1 million users.

However, these are just the obvious data. The deeper changes brought about by AI are hidden beneath the iceberg. For instance, the optimization of minor language translation and communication by generative AI is growing exponentially.

"Sometimes customers come around 4:30 a.m., and AI can directly communicate with them in minor languages. It can help us conduct background checks on customers, such as determining how many products they need and what they are used for. Many times, customers don't even realize they are communicating with AI," said Huang Ruihua. In the past, most of the company's foreign trade salesmen received French customers in English and needed to keep translation software on hand. Now, with the help of AI, they can directly communicate in French, significantly enhancing the efficiency of reception and order placement.

During the March New Trade Festival alone, Dimax Sporting Goods increased its best-selling products by 300% and its excellent best-selling products by 175% in just one week with the help of the international station's AI Agent.

Among the explosion of European foreign trade orders, the growth from minor language countries is particularly notable. Besides France, markets such as Italy, Spain, and Germany have also seen accelerated growth to varying degrees.

In terms of product categories, common consumer goods such as beauty products, luggage, consumer electronics, clothing and accessories, jewelry, eyeglasses, watches, and home and garden products, as well as non-consumer goods like hardware tools, engineering machinery, and auto and motorcycle parts, have all seen double-digit growth in order volume.

AI has also reshaped the operating habits of cross-border sellers. In the past, foreign trade was an industry with high manpower demands, requiring not only the search for overseas business opportunities but also the publication and optimization of product information, patience in dealing with customers across time zones, and vigilance against policy changes in overseas markets that may bring risks at any time.

Currently, Alibaba International Station has launched four AI Agents for product operation, automatic reception, intelligent marketing, and risk control compliance, automating most aspects of foreign trade operations and lowering the barriers to entry for foreign trade businesses.

Huang Ruihua told "Market Trends" that it used to take more than ten minutes to publish a product on a cross-border platform, but AI can do it in just three minutes. If there aren't too many keywords and parameters to modify, AI can be even faster:

"We are also training AI to input product parameters and information into the model for training. Now, AI's ability to publish products and capture keywords is even better than our average employees. Overall, we can save nearly 80% of our effort."

Another Alibaba International Station merchant, Li Dong, even "tackled" a "ten million order" in just one week during the March New Trade Festival this year.

Li Dong's secret is to input marketing information into the AI knowledge base in advance, so that automatic reception sends relevant marketing information to new inquiry customers. "In the end, about 30% of new customers were attracted by AI, and the daily business opportunities in March increased threefold to 200." The old customer behind that "ten million order" was on the AI's active marketing list.

Li Dong's team even handed over the "night shift" work to AI. Of course, before that, they not only fed FAQs to AI but also connected a private knowledge base to let AI learn "human tone" and even use various expressions, so that "customers don't even know they are chatting with AI."

After the advent of AlphaGo, Go players were shocked by the reversal of traditional chess strategies. For foreign trade businesses, AI can not only assist with arduous tasks but also help businesses make better judgments in product publishing, quoting, market analysis, and other dimensions.

For B2B cross-border businesses, the underlying logic of global trade is being rewritten by AI. On the one hand, the United States, the core market for cross-border trade in the past, is facing policy fluctuations, and the tariff stick wielded by the government has made businesses feel insecure. However, Europe, which is "not a new market," can also become an "emerging market" under the cultivation of AI, which is excellent news for China's foreign trade. This is also the "butterfly effect" of AI application.

More importantly, the impact of this technological wave is not limited to Europe.

Driven by AI technology, the discourse power of global trade is being redistributed. With AI technology as a link, China's production capacity is connecting with the demand of emerging markets around the world. In regions such as Africa, the Middle East, and Latin America, massive demand is pouring into the market. The explosion in the European market is likely just the beginning.