While Temu’s meteoric rise continues to capture headlines across Europe, AliExpress – the international marketplace arm of Alibaba – has been quietly cementing its position as a dominant force in European e-commerce.

Despite its launch in 2010, it was not until 2023 that AliExpress began achieving notable traction, rapidly becoming a key marketplace contender in numerous European markets.

AliExpress now ranks second in France, Spain, Portugal, Greece, Hungary, and Romania, and third in markets including the Netherlands, Norway, Poland, and Slovakia.

Its consistently high performance, even in mature economies such as France, reflects a clear shift in European consumer behaviour towards low-cost platforms that were once considered peripheral.

This ascent has been facilitated in part by the awareness generated by rivals such as Temu and Shein.

The pandemic period initially saw AliExpress struggle to maintain visibility, overshadowed by more aggressively marketed fast-fashion competitors.

However, the growing consumer appetite for low-cost goods from Chinese platforms created favourable tailwinds.

As trust in Chinese-origin marketplaces grew, AliExpress benefitted indirectly, leveraging its existing operational scale and broad product diversity.

The payments industry should take note of this development.

AliExpress’s business model, underpinned by ultra-low prices, also drives significant drop shipping activity in Europe.

Drop shipping remains an attractive yet increasingly saturated business model in which independent merchants or small businesses list AliExpress products on their own storefronts, only to have items shipped directly from AliExpress suppliers to consumers.

This structure creates implications for payments firms, particularly regarding chargeback risks, fraud monitoring, and merchant onboarding scrutiny.

Drop shipping-related transactions often carry elevated risk profiles due to consumer complaints about delivery times, product authenticity, or quality mismatches.

Payment service providers (PSPs) and acquirers serving small e-commerce merchants must remain vigilant in underwriting and monitoring such accounts, especially given rising scrutiny from European regulators focused on cross-border consumer rights enforcement.

Moreover, AliExpress’s rapid growth raises competitive questions for domestic European marketplaces and payment companies.

Its market penetration, achieved with minimal local infrastructure, demonstrates the strategic power of scalable digital payment acceptance, effective cross-border settlement, and localised payment options.

For instance, integrating SEPA-based methods, local wallets, or Buy Now, Pay Later options in specific EU markets could further consolidate its position.

Although AliExpress ranks slightly lower in Germany, the UK, Ireland, Switzerland, and Sweden, holding 6th or 7th place, its strong performance elsewhere highlights an untapped competitive advantage.

Its absence in Austria, Finland, and Denmark is an outlier, suggesting logistical or regulatory barriers yet to be addressed.

In sum, AliExpress’s European advance should not be viewed merely through a retail lens.

It exemplifies how seamless cross-border payments, competitive pricing, and digital platform scale can overturn established market dynamics.

As it continues to integrate with local logistics and payment infrastructures, AliExpress may soon transition from quiet contender to dominant incumbent in Europe’s e-commerce hierarchy.