How Did Alibaba Win The Battle against eBay?

Alibaba is the most popular e-commerce in China. It accounts for 58.2% of Chinese retail market share, while the second one, JD.com, has 16.3%. Alibaba was founded in 1999 and now owns products such as Taobao, Tmall, Alipay etc, which covers retailer, brand, logistics, financial service and many more.

The success of Alibaba is due to loads of factors. As far as I am concerned, there are three main reasons resulting in its achievement today, ie, Taobao,advertising, leadership.

Taobao

Taobao is an online retail platform, equivalent to Ebay and Amazon. officially established by Alibaba on 10th May 2003. To obtain as big market as possible, Taobao was free to register and use, even if it had a trading loss for 5 consecutive years since it started. It attracted a significant amount of retailers to open their online shops on Taobao.

On 13 January 2009, Taobao announced that the trade volume reached 99.96 billion RMB in 2008 and it became Chinese biggest retail market. Chinese people began to give up shopping on high street retailers, but on Taobao. Taobao became a brand of Alibaba who soon developed other products, Alipay, identical to Paypal, Aliwangwang, similar to Skype, Ant Credit Pay, like a small loan provider. In a word, Taobao is the foundation of Alibaba’s services.

Advertising

In China, 11 November is celebrated as Single’s Day, which started in 2009. Alibaba decided to have a big sales day between autumn and winter and aimed at young customers. Single is a very attractive theme among youngsters and Alibaba took a big advantage of it to promote the sales. Undoubtfully, it is a massive victory. The sales came to 52 million RMB, 10 times as much as daily sales. The Single’s Day sales on Taobao has been on every year since 2009, it is said that the sales was 213.5 billion RMB on 11 November 2018 alone.

Apart from Single’s Day, Alibaba also dispatches red packets, lucky moeny, over Chinese New Year. Chinese people are obssessed to login to Taobao to participate in this activity. Talking about how much red packets received is a beloved topic over the Chinese New Year.

Leadership

Jack Ma is the founder of Alibaba. He is a superman who has unique insight, creative ideas and strong personality.

As an English teacher and translator, he received a very decent salary in late 1990s, and it was a dream job for most Chinese people. However, Jack Ma made his decision to quit his job and started online business. In 1990s, lots of Chinese people never heard about online business, but Jack Ma believed in its great potential and invested it. He didn’t manage to make any profit for almost 10 years, but he never gave up.

He had an idea to start financial service Ant Credit Pay. It is similar to bank services from which you can borrown money, save money, buy financial products but in a much smaller amount. Ant Credit Pay helps young people buy stuff on Taobao, thus boosting business in both Taobao and Ant Credit Pay.

He convinced his business partners that his idea is not impossible and they can make it work. He used his personal skills to persuade them to stand on his side to develop Ant Credit Pay, Aliexpress, Alibaba Clound, which are new products changing customers’ behaviour.

Thanks to Taobao, great advertising and Jack Ma, Alibaba is growing faster than competitors. It is still growing and the market Alibaba is targeting at is international, as their products are issuing international versions.