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The contemporary world is known for the fast progress in digital technologies facilitated by the internet that provides total and ubiquitous connectedness on the global level. As a result, the businesses involved in online retail have a massive advantage to expand their customer base and increase their income. The focus company of this paper is the Chinese e-commerce giant called Alibaba Group – the largest retail and wholesale company specialized in the online trades. Alibaba Group is known for its rapid expansion and the development of a broad ecosystem that secured a variety of competitive advantages for it.
Alibaba Group Holding Limited is based in the People’s Republic of China; however, its business operates globally, and the company has customers in every continent. The leader and the major founder of the company is a businessman and a former teacher of English, Jack Ma. Today, he is known as one of the wealthiest people on the planet and his business success and strategy are admired and studied in the business schools as exemplary. Initially, Alibaba Group was organized with one main objective – to create marketplaces for the small domestic businesses of China (Alibaba Group Holding Ltd (BABA.N), n.d.).
Jack Ma and 17 of his associated founded Alibaba Group in 1999 (The History & Timeline of the Alibaba Group, 2014). Focused on their role of the providers of the growth opportunities for the small domestic manufacturing companies, Alibaba Group took the Chinese trades to the new level. As a result, today, the Chinese business tend to produce more goods than the local consumers need as they rely on the customers from abroad. As the e-commerce business of Alibaba grew, the company became to penetrate many other spheres of life of their customers. These days, they B2C and B2B online platforms specialized in retail and wholesale such as TaoBao, Aliexpress, and T-mall, mobile payment (Alipay) and Cloud computing services; the company also is involved in the entertainment sphere owning a TV channel and producing motion pictures, mobile games and supporting a mobile browser (Alibaba Group Holding Ltd (BABA.N), n. d.)
Mission and Vision
According to the website of Alibaba Group, its mission is “to make it easy to do business anywhere” (Company overview, 2016, para. 1). The focus on the expansion of the business and growing its ecosystem is the main idea of the company’s vision and its primary goal. Small businesses remain the main target of Alibaba Group (Culture and Values, 2016).
The competitive advantage of Alibaba Group is its size – the e-commerce giant is larger than several platform that operate in Europe combined which reflects in its level of income (Here’s Why Changing Market Dynamics Should Worry Alibaba’s Investors, 2014). Besides, the strong and all-consuming ecosystem provides a larger client base and secures the company’s dominant position in more than one market.
One of the biggest problems Alibaba Group has to deal with is the heavy presence of counterfeit goods in its e-commerce platforms. In fact, most of the company’s current income originates from the activities of the counterfeiters selling know off items via the Chinese platforms. The leaders of the company are known to overlook this issue offering their marketplaces on mild conditions to all kinds of businesses (Buchwald & Neckes, 2014). Some of the world’s most renowned brands such as Gucci and Yves Saint Laurent noted that they were willing to press charges against Alibaba for the support of knockoffs that harmed the original manufacturers (Raymond, 2015).
Alibaba Group Holding Ltd (BABA.N). (n. d.). Web.
Company Overview. (2016). Web.
Culture and Values. (2016). Web.
Raymond, N. (2015). Alibaba sued in U.S. by luxury brands over counterfeit goods. Web.
The History & Timeline of the Alibaba Group. (2014). Web.