THE ALIBABA CASE STUDY

Running head: ALIBABA CASE STUDY
Alibaba Case Study
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1ALIBABA CASE STUDY
Question 1
Alibaba is basically an ecommerce platform. The major services that Alibaba provides
are B2B and B2C selling platform. When it first started, the company provided platform for
Chinese manufacturers to sell to other international retailers as well as traders. Then it started
to provide services for C2C and B2C sectors. In simpler words, Alibaba is somewhat like
Amazon or e-Bay as they too, connect the sellers and the buyers. They have three platforms
that they use for this purpose (Wang et al. 2018). The site Alibaba.com is used for
international business, 1688.com is used for B2B sales and AliExpress.com is a platform for
small businesses. Despite these similarities, Alibaba has some unique features. They do not
have inventories, thus, they have no goods stored, and they do not have any warehouses
where they would be able to keep the products. They do not have fulfillment responsibility
which indicates that they ate not liable to exchange or return but the seller is and nor does it
take any charges from its users.
The major competitor of Alibaba in China is JD.com. This company came in the
market few years later than Alibaba, and conducts their business through direct selling. They
have their own warehouses, shipments and transports that makes it one of the greatest
competitor to Alibaba (Jiang and Lu 2018). Due to their business structure JD.com has been
able to tap the gap in the market that had been their due to Alibaba’s business strategy, the
authenticity and reliability of the products.
Question 2
The competitive advantage of Alibaba in the country china is that they have an
extremely low cost business model. They do not have warehouses or direct transport system.
They do not take any money from the sellers which is a great competitive advantage for
them. Any other ecommerce companies have to bear the costs of such infrastructures or
services and thus are costlier than Alibaba (Yuen 2016). They have focused on cost savings
and affordability of the consumers and the SMEs. They also have started operating a
OneTouch platform that allows the consumers to book tickets for ships. They are focusing
more on providing their own delivery, much the same way their competitors do.
Another competitive advantage of the Alibaba is their ability to understand the
changes in the market and changing according to that. In most cases, the problem with old
companies remain in their rigidness to change. They do not accept the gaps that are there in
their business model. Alibaba is different in that aspect. They are constantly evolving with

2ALIBABA CASE STUDY
the new market. They have changed their business strategy and has changed the way they
approach counterfeit products (Forgione 2016). They are developing their physical presence
through acquisitions so that they are able to compete with the ecommerce giants like Amazon
or e-Bay. In the last few years there have been much outcry about the methods of corporate
business and their moral code of conduct. Though, the company got involved at the
beginning, they have been able to make all the necessary changes so that they are able to
compete against their market competitors.
Question 3
For businesses, the greatest motivation is that it provides them with large number of
businesses and consumers that are willing to buy from them. B2B businesses need bulk
consumers, mainly other sellers who will take products from them in a large quantity. The
Alibaba platform provides them with the opportunity to connecting with consumers locally
and globally. The international goods sellers for B2B business use the Alibaba.com to
facilitate imports and exports across the world. The local Chinese B2B sellers use 1688.com
which provides them with business opportunities in the Chinese market (Tan et al. 2015). The
china is a large potential market and due to its population, it is quite lucrative. There is also
AliExpress.com which is for small businesses, who are not willing to buy in large bulks but
in a small quantity. This enables both the businesses to compete in the market without
investing too much. There are no delivery charges which is an added bonus for them.
For customers, the company provides them with a diverse range of products at a much
cheaper level. The consumers can order in both small and large quantities. Thus Alibaba has
always kept focus on the cost effectiveness of their services. They do not require delivery or
any additional charges (Chen 2016). The company is well known and is a leader of e-selling
in the Chinese market. It also gives the consumers and opportunity to connect to their desired
sellers. The company has a swift refund policy which is also another motivation for using
Alibaba.
Question 4
Though alibaba is the most popular ecommerce brand in China, there are many
potential buyers inside the country who are not yet buyers of the brand. The reason behind
that is their association with the counterfeiting accusation. Many of the people in china prefer
authentic and original products. Due to the practices of Alibaba in the last few years and Jack
Ma’s commentary on counterfeiting that the quality of the counterfeited products are equal to