Alibaba: Competing in China and Beyond

1395 Words Jan 8th, 2013 6 Pages
Alibaba: Competing in China and Beyond
Individual Report

Intercultural Management
Professor: Dr. Jacobo Ramirez

Aalto University
School of Economics
Bachelor´s Degree Program in International Business
Mikkeli Campus

September 3, 2012
Matti Uusivirta

Introduction

In this report I will examine the case “Alibaba: Competing in China and Beyond.” Alibaba under the leadership of Jack Ma, its founder has transformed into one of the most successful e-commerce companies in China. In the 2000s Alibaba had emerged as the largest e-commerce company in China. The company tailored its strategies to meet the needs of the customers and made a mark because of its understanding of the Chinese language and culture. However, some
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Also again Ma decided to build a loyal customer base before really attempting to make a profit; he did this by offering free listings as opposed to eBay, which charged for listings (Deresky, 2010).

A major factors in Taoboa 's success was Alibaba Groups better management of the trust factor involved in e-commerce trading and better understanding of the local Chinese market. eBbay positioned its standard business model that was used in the United States and other countries. Taoboa, instead, established its own payment escrow service. With AliPay buyers paid into an escrow account that did not pay the seller until the buyer noted he had received the product; therefore, making the transaction thrust worthy since the money was in escrow until the transaction was completed (Deresky, 2010).

Furthermore, Taoboa offered e-mail and chat services between users unlike eBay, which concealed identities and only had an offline messaging system. Taoboa also advertised aggressively through websites and billboards in major population areas something eBay did not do. The final steps of defeat for eBay was when Taobao offered three years of free listings and when Taoboa launched its B2C services in 2006. Moreover Taoboa had a large list of

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