Alibaba and Lolli butt heads over Bitcoin announcement

Earlier this week, we reported Lolli’s announcement that it had partnered with Alibaba, enabling shoppers to earn 5% back in Bitcoin.

“This is a milestone partnership for us as Alibaba is the largest retailer and e-commerce company in the world. It allows our users to earn free Bitcoin on millions of products online every day,” said Alex Adelman, CEO and Co-founder, Lolli. “Arguably the most important piece of this partnership is that it supports our mission of connecting the entire world through commerce.”

The tie up was short lived, however. Here’s why…Alibaba’s cross border B2B unit, whose buyers are located primarily outside China, works with contractors who drive incremental buyer traffic to its site through arrangements often referred to as affiliate marketing programmes.

“These are transactional relationships – not partnerships - whereby the affiliate incentivises users to make purchases on Alibaba.com and Alibaba.com pays the affiliate a set rate for any sales those users generate. One of our contractors hired a subcontractor who brokered an affiliate marketing programme with Lolli. This was done without our knowledge,” an Alibaba spokesperson told RTIH.

They added: “Upon seeing media coverage that mischaracterised the nature of the affiliate marketing programme established between the subcontractor and Lolli - i.e. it erroneously stated that Lolli had a Singles’ Day partnership with Alibaba – we contacted Lolli and asked them to cease these claims, remove related social media posts and content from on their own website and also to advise media who had published stories containing the mischaracterisations.”

Alibaba’s contractor is terminating the relationship with the aforementioned subcontractor. “As a result, Lolli should no longer promote or bring traffic to Alibaba.com. Further, it never had the right to claim a partnership or imply one with Alibaba Group. We reserve all rights and remedies as against any future misrepresentations made by Lolli.”

The company’s furious response should come as no great surprise. It has, after all, not been a big fan of Bitcoin thus far. Last month, we reported that its digital payments arm, Alipay, was banning any transactions related to Bitcoin or other cryptocurrencies.

Lolli responds

"On 11th November, we introduced an affiliate partnership with Alibaba.com. Lolli and the agency representing Alibaba.com mutually agreed to launch this partnership in conjunction with Singles’ Day.

The agency said: “We are excited to provide the shoppers with the opportunity to earn and own Bitcoin as another incentive for doing business with us”. Alibaba.com trialled our services for 24 hours and decided to deactivate the partnership without cause — breaking its contract. This is the same type of partnership it has in place with similar rewards companies.

The aforementioned agency approved a contractual agreement on behalf of Alibaba.com that included the promotion of the latter, the use of its brand, email marketing, and sharing on social media and various channels. There was no malintent on our end to misrepresent Alibaba. Lolli is partnered with 750+ top merchants and our goal is to feature them, drive sales to their businesses, and give our users an easy and safe way to earn and own Bitcoin.

We hoped to do the same for Alibaba. It seems as though there was a miscommunication on Alibaba’s end and while that’s unfortunate, we look forward to the possibility of working with Alibaba.com again in the future. In the interim, Alibaba Group’s AliExpress and its cloud computing service company, Alibaba Cloud, are still live on Lolli."