Alibaba Case Analysis

ALIBABA.COM

Introduction

Alibaba.com (the company) is a business-to-business website (B2B) that offers sellers the opportunity to showcase and sell their goods. It has 61 million registered users in more than 240 countries and regions.

Alibaba.com is the flagship company of Alibaba Group (parent company), a private enterprise based in China. Alibaba Group has a 73% stake in Alibaba.com. The company is listed on the Hong Kong Stock Exchange (Symbol: 1688). The parent company is owned by Yahoo (39%), Softbank - a Japanese telecommunications company (31%) while the remaining shares are held by the Chairman, Jack Ma and other founders. Exhibit 1 outlines the subsidiaries of the Group.

Alibaba.com was set up in 1999 by Jack Ma along with 17 other founders.

The company has four marketplaces or trading platforms:

* www.alibaba.com: International platform

* www.1688.com: Chinese platform

* www.alibaba.co.jp: Japanese platform

* www.aliexpress.com: small order platform geared towards the purchase of small quantities

The website itself does not sell any physical products. Buyers join for free and suppliers can join for free as well but value-added services are provided to suppliers who pay CNY 29,800 per annum to become Gold Suppliers. A China TrustPass membership is also available.

According to the website, Gold Suppliers can:

* list an unlimited number of products with top-tier priority,

* get exclusive access to buyers contact details

* the latest buying leads before non-paying members

* gain buyers trust fast with the Gold Supplier seal

* analyse performance in real time

* trade with global big buyers as sourcing events

* gain targeted exposure at tradeshows that Alibaba.com attends

* create a company website in less time with design templates provided by Alibaba.com

Suppliers use the company’s services to manage their storefronts on the website and their customer relationships. Not all...