University Report: Digital Business Strategy Development for Alibaba

This report provides a detailed analysis of Alibaba's digital business strategy, focusing on its evolution and key components. It begins with a synopsis of Alibaba's e-commerce operations, highlighting its growth and digital marketing strategies. The individual report delves into the company's digital business strategy, emphasizing the role of cloud computing and technologies like X-dragon Super-Computing Cluster, PolarDB, and SaaS Accelerator. It also explores the application of strategic analytical tools such as SWOT analysis to understand Alibaba's market position. Furthermore, the report examines how Alibaba manages its business performance, including the use of KPIs and the evaluation of big data technology. Overall, the report offers insights into Alibaba's innovative approaches to digital business and its strategies for maintaining a competitive edge in the global market.

Running head: DEVELOPMENT OF DIGITAL BUSINESS STRATEGY FOR ALIBABA
Development of Innovative Digital Business Strategy for Alibaba
Name of the Student
Name of the University
Author note

1DEVELOPMENT OF INNOVATIVE DIGITAL BUSINESS STRATEGY FOR ALIBABA
Table of Contents
1. Synopsis.......................................................................................................................................2
2. Individual Report.........................................................................................................................4
2.1 Introduction............................................................................................................................4
2.2 Discussion..............................................................................................................................5
2.2.1 Digital Business Strategy at Alibaba..............................................................................5
2.2.2 Management of Business Performance by Alibaba......................................................11
2.2.3 Evaluation for Big Data Technology established for Alibaba......................................15
2.3 Conclusion...........................................................................................................................19
References......................................................................................................................................22

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1. Synopsis
The Alibaba Group is considered as one of the most reputable kind of multinational e-
commerce company that primarily specializes in the sector of retail, internet and e-commerce.
The company was founded during 1999 in the city of Hangzhou of China. The company is
categorised as a B2B website specializes to the rising demands of buyers, suppliers and
promoters. The primary target audience of Alibaba’s website is their employees and globally
distributed customers. From the year of inception till the present times, it has been seen that
Alibaba has experienced tremendous form of growth in their digital business strategies.
Alibaba follows a simple ecosystem within the digital business strategies based on
linking their wide ranging number of seller and buyers of goods and various other services. With
the movement of business functions towards the online platform different functionalities that are
performed are marketing, logistics, advertising, finance and social media strategies. Digital
marketing, as the name suggests, refers to the wide number of processes based on providing
services and products to their dedicated customers with the help of Internet based strategies. The
Internet is used as the primary tool for sending items to customers. Digital marketing and
business strategy also refers to the collection of information, analysis and enriching the use of
information for evaluating the activities of customers.
All form of digital business strategies that would be implemented through the Internet are
considered as the primary means for achieving certain kind of objectives based on marketing.
Digital business forms a major component within the marketing of the business functionalities of
Alibaba. The various functions based on performing digital business includes promotion of their
website in various social media platforms, launch of specialised information, maintaining an

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efficient relation with customers, enhancing the channels based on sales and service, online
research and promoting their brand for building a global reach to customers. Alibaba is thus
considered as one of the largest form of experienced companies based on the Internet since their
inception. These different kind of digital business strategies are further been implemented for the
purpose of ensuring the practices of providing their customers with comprehensive form of
marketing services.
Based on enhancing their digital business strategies, Alibaba had also developed their
payment instrument, which was named as Alipay that was firstly implemented in China. The new
kind of instrument based on making digital payments was mainly designed to enhance their
digital business platforms and it had also contributed to a major success factor for the business.
Alibaba also supports a major process of gaining feedbacks from their customers and employees
regarding the type of services that they offer to their online customers. Alibaba, which is in the
constant process of expanding their business market have approached the strategy of offering
freebies to their customers.

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2. Individual Report
2.1 Introduction
Alibaba is presently been considered as the largest and reputed e-commerce platform,
which continuously has been in the process of expanding their business opportunities in all over
the world. Since its inception, the company has been in the process of developing new kind of
online strategies and enhanced form of business growth opportunities that has the capability to
attract the international customers (alibaba.com 2020). The different strategies that are set
forward by the business sets their standards apart from rest of the competitors of the company.
Alibaba Group comprises of seven business groups, which are considered as the growth factors
leading towards the positive outcomes as planned for the business.
The company operates as one of the leading e-commerce business, which expands their
operation over the online mode of mobile marketplace in terms of wholesale and retail trade.
They also perform different other kind of services such as supporting an online platform that
would enable merchants, customers and various participants for conducting business based on
associating within their network. In the present state, Alibaba possess the capability to run both
of their domestic and international marketplace (Jin and Hurd 2018). These marketplaces
primarily put their focus on a globally distributed network that is established for suppliers and
buyers based on the consideration of raw materials, integrated components and wide form of
finished goods. The domestic market supported by Alibaba focuses on buyers and suppliers
situated in China.
The mission and goals that are set by Alibaba is based on building a profitable and strong
kind of business to customer connection. In order to maintain the efficient form of connection

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with customers, Alibaba had built an efficient marketing strategy, which would have a massive
impact over the overall strategic plan set for the business (Lin and Mehaffy 2015). Upon defining
the success for the organisation, it can be defined that Alibaba had mostly set these plans by
performing market segmentation based on their target market. Intensive form of marketing
analysis and planning have been taken under consideration for taking a long-term relationship
between their sellers and buyers associated within their platform.
In the following portions of the report, the discussion would be primarily be focused
upon the kind of digital technologies that are used by Alibaba in order to enhance the growth of
their business. The discussion would be further be focused on the application of strategic
analytical tools, which would further help in supporting towards the developmental process of
the digital business strategy (Ter Chian Felix Tan, Tan and Pan 2016). In the next part of the
report, the discussion would be put on appraising the ways in which Alibaba would be able to
manage their business performance. Hence, a list of KPIs are discussed, which would help
Alibaba to understand their performance in the international marketplace. The final portion of the
report helps in the evaluation of the big data technology and the ways in which the technology
would be able to enhancing the performance of the business.
2.2 Discussion
2.2.1 Digital Business Strategy at Alibaba
Digital form of business strategy that supports Alibaba can be considered as one of the
most important support systems for the overall business platform. In this context, different
reports published have shown that Cloud Computing has been considered as the strong backend
technology that supports the e-commerce giant in the international market (Anwar 2017). Cloud

6DEVELOPMENT OF INNOVATIVE DIGITAL BUSINESS STRATEGY FOR ALIBABA
computing is considered as an important form of business asset for Alibaba Group. In the recent
times, the Alibaba Cloud is considered as one of the latest form of IaaS providers. It is also
considered as one of the largest provider of services based on the public cloud (Jia et al. 2018).
In the recent decade, the Alibaba Cloud domain has been considered to possess 162 products and
has also activated nearly 4610 functions and features.
The Alibaba Group has majorly championed the use of cloud computing in China in the
past 10 years. The firm has been reportedly considered to be present at the forefront of the rapid
development of technological progress. Cloud computing technologies and data intelligence has
been the prime factor underpinning the entire economy of Alibaba from payment and e-
commerce, to supply chain management and logistics (Lu et al. 2017). The paramount factor
towards the business of Alibaba are security, reliability and scalability. Thus, with the help of
these factors, Alibaba has majorly been helpful in sustaining real-word test scenarios. The
Alibaba Cloud is considered as one of the primary form of IaaS market leader in China based on
a large share (Jiang et al. 2019). With the growing importance of cloud supported technologies
and rise in digital assets possessed by Alibaba Group, the adoption of cloud resources is
considered to be the primary factor affecting the growth of the organization in terms of digital
assets.
Alibaba Cloud has the major capability to highly invest in different forms of
technological development and research. With the application of such form of digital capabilities
that are possessed by Alibaba, these technologies help in ensuring that the e-commerce giant
possesses the major capability to offer internet-supported technological products and powerful
computing approach based on the further form of adoption of data intelligence and cloud
resources (Zhang and Ravishankar 2019). The company has acquired a range of new products

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that would be considered to be extremely helpful for the growth and achieving success for their
business. Some of the most highlighted products that are being offered by the company in terms
of their growth of technological resources are:
1. X-dragon Super-Computing Cluster instance SCC-GN6 – This is considered as one
of the most powerful form of metal server instance that was launched by the company in the
recent times. They have the capability on enhancing the performance of the cluster by a
percentage of more than 100. The new kind of instance has the capability of providing 50 Gbps
of RDMA networking throughput, 8 NVIDIA V100 Tensor Core GPUs, 96 custom Intel Skylake
vCPUs (Liu et al. 2018). These together form 1000 TFlops for performing computational
throughput and high-performance based parallel file system with 1TB/s R/W throughput. SCC-
GN6 has the capability of supporting different scenarios of supercomputing that includes
machine interpretation, autonomous driving, recommendation systems and natural language
processing (NLP).
2. PolarDB – This is considered as the cloud-native relational database-based service that
is being primarily designed for the applications of enterprise-grade database. PolarDB is mainly
compatible with MySQL, Oracle and PostgreSQL. It also possesses the capability of offering
excellent kind of business scalability with the underlying architecture of software-hardware co-
design (Marchuk 2016). PolarDB has the capability of scaling up to 710 GB of memory and
88vCPUs. It also helps towards allowing customers for paying for their usage on a minute basis.
The PolarDB further allows customers for handling the peak form of business traffic while
minimizing the excessive factor of cost. The Polar DB might also scale up to 100 TB in terms of
storage space, which further help their customers to cope up with the developmental aspects of
Big Data systems.

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3. SaaS Accelerator – This is considered as a highly efficient and agile-based platform
in which ecosystem partners would be able to easily develop, build and implement SaaS-
supported business applications (Knodel and Spallek 2015). They also possess the capability of
leveraging the proven business capability of Alibaba and supporting a technology based on
know-how. The SaaS accelerator also primarily helps customers based on SaaS for quickly
deploying and test their major business applications on the cloud-based platform. The accelerator
also possesses the capability of shortening the lifecycle of implementation while also
accelerating on a time-to-market. They also possess several kind of innovative features such as
the drag-and-drop interface, an intuitive interface and a launch kit, which are highly compatible
with the various application programming interfaces (APIs) (Stackowiak 2019). With the help of
the SaaS accelerator, a smart form of SaaS application could be able to go live in a short period
of five days.
In consideration of the case supporting the use of digital technologies being used at
Alibaba, there can be a consideration of some form of strategic analytical tools, which would
help in understanding the strategic position of the company in the international market
(Gutmann, Kanbach and Seltman 2019). In the case of the concerned Alibaba Company, the use
of SWOT could be considered based on the utilizing the exploitation of external opportunities,
protecting the strengths of Alibaba, defining counter threats and eradicating the weaknesses
while also identifying the opportunities that could be utilized by the company.
The application of SWOT-based strategic analytical tool could be further applied in the
case of Alibaba. These are defined as follows:

9DEVELOPMENT OF INNOVATIVE DIGITAL BUSINESS STRATEGY FOR ALIBABA
1. Strengths – Alibaba possesses numerous strengths that primarily help the company in
thriving in the global marketplace. The discussed strengths help towards protecting the share
within the existing markets while also helping them to penetrate within the new markets. Some
of the major strengths possessed by Alibaba are discussed as follows:
a. Higher customer satisfaction rates – The Company has an intensive relation with
their customers (Khan, Liang and Shahzad 2015). They also have the capability of achieving
high level of customer satisfaction rates while maintaining a good form of brand equity within
their potential customers.
b. Successful business track record – In the recent past years, Alibaba has a strong
record of performing acquisition with different complimentary firms, which further help them in
streamlining of business operations and building a reliable mode of supply chain.
c. Fine performance on growing markets – The Company also possesses a good record
in maintaining a strong sense of communicating and making way into the new markets and
gaining success from such acquisitions (Hidalgo Naranjo 2018). This capability primarily
supports the organisation to develop a new kind of stream for generating revenue while
diversifying the economic cycle of risk in the market in which they operate.
2. Weakness – There are some areas in which Alibaba could possibly improve their
strategies about making choices and improving their current state of operations. These are
discussed below:
a. Investments in R&D – Through Alibaba have been majorly investing in the areas of
Research and Development, yet they are not being able to keep pace with the rising demands of
the market and manage their competitors.

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b. Less investment in new technologies – Based on the estimation of the scale in which
Alibaba has been expanding in different geographies, Alibaba is not investing sufficiently in
technological areas based on integrating the various individual processes (Murray 2017).
c. Tackling challenges – Challenges based on moving to the different product segments
based on depending on their present culture is considered as another challenge faced by Alibaba.
3. Opportunities – The certain opportunities that could be brought in within the
organizational policies and making improvements of their scenarios in the competitive market
are discussed below:
a. Enhanced environmental policies – The new form of environmental policies would
be helpful in the representation of a great opportunity for driving several advantages based on
gaining a market share in new category of products.
b. Estimating transportation costs – Lower prices of shipping of products could also be
a leading opportunity for bringing down the cost of the products delivered by Alibaba.
c. Improvement in digital technologies – Implementation of new technologies at
Alibaba would help the company in differentiating their pricing strategies within the highly
competitive market (Zhao, Wang and Gao 2015). This could be a major way to lure customers
based on different value-oriented propositions.
4. Threats – The obvious threats that are being faced by the Alibaba Company are:
a. Less skilled workforce – Certain shortage in skilled workforce in the international
market could be considered as a continuous threat leading to steady growth of profits.

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b. Lawsuits in different markets – Continuous fluctuations and changing laws regarding
the standard of products could lead the company in facing lawsuits.
c. Low estimation of customer behaviour – The changing form of customer behaviour
could be considered as a major threat to the organisation (De Souza 2020). Inefficiency in
estimating the changing behaviour of customers could lead to tremendous losses to the company.
2.2.2 Management of Business Performance by Alibaba
In the recent times, there has been major rise in the competition towards the business
sectors. This has further led to tremendous changes made in the context for every businesses
while making them highly dynamic in nature based on the changing needs of customers.
Advancements made in the field of technology have also formed another tremendous factor thus
contributing towards the factor of increasing business competition (Falcone, Kent and Fugate
2019). The sector of e-commerce has become one of the increasing and common factor that
would be implemented by each organization based on the factors of advancements in
technological aspects. Thus, in this context, it can be discussed that Alibaba, which is a major e-
commerce giant has been in the process of adopting a generic strategy, which has been in the
process of guiding their activities of business.
In the context of the business of Alibaba, it has been that the business processes followed
within the company are based on lowering of operational costs through the use of appropriate
form of technology. Since, the core functionality of the business is supported by technology,
hence it is majorly considered as the primary success factors underlying the business objectives
(Burke and Eaton 2016). Alibaba does not own their own warehouses for the purpose of storing
finished goods. The goods, which are displayed on the website of the company can be viewed by