Alibaba.com, the treasure of global e-commerce
You might have heard about Alibaba.com; perhaps you’ve come across the name when looking to buy something online, or you’ve heard about them on the news. But did you know it’s the largest e-commerce business worldwide? It has about 500 million user accounts, even though it mostly services China.
Imagine Amazon mixed with eBay, throw in some PayPal and Google, then sprinkle it with social media. It’s a social marketplace, bank, search engine and more. Combining these services and then tracking their users through different platforms and devices has given Alibaba a huge boost on the global market, with a revenue of 101.14 billion Yuan (20.03 billion AUD) for the financial year ending in March 2016.
How did Alibaba takeover the e-commerce game?
Alibaba’s strength lies in the unification of branding, searching, sharing and selling. It has two huge online retail platforms, Taoboa and TMall; a payment service, AliPay; a search engine, Shenma; and video and social media channels, Youku and Weibo. It also offers cloud storage.
Tapping into the power of creating a bond between seller and consumer through communication, Alibaba connects them without actually selling items themselves. Like eBay, it’s a B2B (business to business) platform. It doesn’t cost anything to sell through them, but you can buy advertising.
AliPay has become popular in China, partly because of its secure payments and protection for buyers if the merchants don’t deliver the goods – it also offers micro lending.
Tracking users through analytics
The big benefit for Alibaba itself is the way it can observe and track its users through a unified account for all their services. It can learn about users’ age, gender, location, demographic, education and even spending habits and power, through its apps and websites
It’s not surprising that Alibaba is now extending its selling power to western merchants. With international e-commerce on the rise, Alibaba is making it easier for the Chinese, and especially those in rural areas, where the middle class is expanding, to buy things that might not be readily available locally.
Of course, western e-commerce companies are keen to get a slice of the action; allegedly Amazon is investigating ways to cut its shipping costs to compete.
For Australian retailers, it’s more likely that they will develop strategies to use Alibaba’s rumoured plans to open an office in Australia later this year to reach Chinese customers, as there are no Australian B2B platforms big enough to compete with it.
Interested in studying the commerce behind the digital marketplace? Find out more about RMIT’s online Master of Commerce and get in touch with our Student Enrolment team on 1300 701 171.
