For the longest time, the country has been tagging Amazon as the go-to e-commerce website for anything and everything. But even bigger than Amazon, Facebook, and IBM is the Chinese company Alibaba, with its estimated company value of $228 billion. Just why is Alibaba reshaping the future of online retailing?
Alibaba is not your traditional e-commerce website.
While Amazon has a managed marketplace that enables it to create its own brands, Alibaba employs an open marketplace that merely brings buyers and sellers together. It does not own warehouses; it does not sell its own products. It helps small businesses grow more lucrative, and as opposed to Amazon, it does not need to invest in infrastructure and employees. This is why its income greatly outweighs that of Amazon.
Sales for Alibaba are through the roof.
For this year so far, sales of Alibaba are at approximately $420 Billion. For 2013, Amazon merely made $74.4 Billion, while Ebay only clocked in at $16 Billion. How can anyone compete with that kind of market?
Taobao and Tmall.com are major contributors to success.
Taobao enables sellers to peddle their wares by paying for advertisements and other promotions, which is different with Ebay’s commission scheme. Tmall.com is Alibaba’s avenue where big companies can take advantage of selling their products on the web as well. Alipay is similar to PayPal in that this is what customers can use to pay for their purchases. Because Alibaba makes it virtually free of charge for merchants to set up their stores, it’s easier to let the marketplace grow.
Alibaba founder Jack Ma knows what he’s doing.
The former English teacher in China is now one of the richest men in the world. He knows that you have to act on your dreams, and you have to have ambition. But in the end, life is truly all about living. “No matter how successful you are in your career, you must always remember that we are here to live,” he says. “If you keep yourself busy working, you will surely regret it.”
Alibaba’s Singles Day already broke the record and left Black Friday in the dust.
On November 11, 2013, Alibaba already garnered more than $5.75 billion in just a single day. This is due to the massive sales for Singles Day, the equivalent of the phenomenon known as Black Friday. By the end of November 11, 2014, Singles Day took the cake at about $9 billion. “We really are witnessing history here because we are seeing the shift of the economy from focused on the state sector to consumption,” says executive vice chairman for Alibaba, Joe Tsai.