EM4023 - Management in Engineering Enterprises: Alibaba Case Study

This report analyzes the business and management issues faced by Alibaba, drawing from Porter Erisman's book and relevant academic theories. It explores challenges such as branding, target market strategies, and the company's unconventional approaches to problem-solving. The analysis highlights Alibaba's focus on both local and international markets, the use of freebies to attract customers, and the importance of technology in its operations. The report concludes that Alibaba's success is attributable to its strong branding, customer value proposition, sales volume, and economies of scale, while also acknowledging the impact of issues like payment systems, internet censorship, and trust. Desklib provides access to this and other solved assignments for students.

Management in Engineering Enterprises 1
MANAGEMENT IN ENGINEERING ENTERPRISES
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Management in Engineering Enterprises 2
Introduction
Alibaba remains to be among the foremost organization that deals with B2B e-Commerce
established within Chinese markets. From the book, it is evident that Alibaba plays the vital role
as the messenger of the advanced business landscape in the global community. The company
concentrates its operations different regions on the Eastern side instead of Western parts of China
(Alibaba’s World 2015, p. 62). The idea of service makes it have huge marketplaces over
developed companies along with quick entrepreneur over titan of company. According to the
book, there are various business and management issues faced by the internet business Alibaba
some of these were approached in the highly unconventional manner that lead to the mixture of
bad, right, as well as indifferent operational outcomes (Shen & Kim 2016, p. 263). Therefore,
some of these business and management issues faced by the internet business Alibaba addressed
on this paperwork consist of quality of its services and achieving profitability that remains to be
the most significant challenge to its operations.
Classic theory and definitions of target marketing as per the book
The theory states that internationalism of operation of firms has received well
documentation n although there is the lack of the survey into the process of internationalization
of different firms in Chinese marketplaces. Various theories exist relative to internationalization
process. For instance, decision of firm to enter international marketplaces can be regarded as the
steady sequential process related with various phases of internationalization. Through classical
theory, it evident that company of Alibaba concentrates on expanding its new marketplace
through the use of available freebies. The company targeted both local as well as international
marketplaces. The company used different strategies in marketing its essential commodities

Management in Engineering Enterprises 3
along with services by focuses on offering freebies (Yu & Dhen 2015, p. 1). The provided
freebies help in boosting operations of the company by attracting more clients as well as the
customer to utilize the company as the online platform for marketing. Through classical theory,
there is a need for every company to concentrates on investing in different users of their products
as well as services to assist in boosting their customer base. Moreover, classical theory helped
Alibaba to concentrate on enhancing technology and development of the survey for the advanced
infrastructure of the internet to offer the fastest speed as well as accuracy for marketing of its
products online (Alibaba’s World 2015, p. 62). Other future strategy actions on marketing by
Alibaba include the focus to sustain domestic Chinese marketplace. The company has seen that it
is essential for it to maintain its local marketplace first to help in achieving success in the global
market. Therefore, classical theory calls for promotion strategy of e-commerce of Alibaba that
assist in enabling the organization to improve their operations.
Key business and management issues highlighted in the book
Porter Erisman’s book highlights crucial different business and management issues in
operations of Alibaba Company (Alibaba’s World 2015, p. 62). Some of the highlighted Key
business and management issues in the book include:
Branding and image
Just like many companies in China, Alibaba faces the same problem in establishing
strong image branding for its operations as most foreigner partners in business find it tough to
remember the name. The company concentrated on the provision of products within the same
range with variation in prices depending on the suppliers that were capable of offering buyers the
broader choice of variety (Watters 2017, p. 81). Moreover, the idea of penetration pricing

Management in Engineering Enterprises 4
became one of the strategies for marketing tat Alibaba concentrates on implying to set the low
price. The setting of low cost enabled the company to increase its sales along with shares of its
markets. Additionally, Alibaba concentrated on bringing into play discount that helped its
operations to stimulate the sales of its products and services as well as retaining their targeted
clients. The company only concentrated on the idea of giving out discount when their customer
buys their items in bulk or during festive occasions (Luckerson 2014, p. 1). Besides, the
company applied the concept of using value-added services where it ensured that products are all
presented at low cost, but operations that include guarantees, distribution, warranties, and
immediate delivery, along with other operations. These extra services in branding and image
help the company in ensuring that the entire cost of product with additional operations remains to
be superior to the charges of production so that it can make huge profits.
Target market
Alibaba operates while targeting two different marketplaces around the business
community. These marketplaces comprise of the global market-based in the English Language
that tends to cater to different international exporters as well as importers and the China
marketplaces that has the aim of focusing on suppliers together with buyers that trade locally in
China. The company avoided largely well-liked threshold model, but it adheres to operations of
B2B as well as operations of C2C for small, medium enterprises (Xu et al., 2017, p. 247). The
idea of such strategies helps operations of Alibaba to find different business opportunities in the
international marketplace quickly. The company also launched different websites to assist it in
reaching various people from different places that use the internet as a mode of communication
and conducting business operations. The use of internet has seen the company improve on its
customer acquisitions through its force of sale together with their resellers’ networks. Besides,

Management in Engineering Enterprises 5
transactions that deal with services of value addition that comprise of bidding of keyword
together with best placements have remained to record healthy development. The presence of
two different marketplaces for Alibaba operations continues to be collectively the most visited
B2B website on the internet (Preimesberger 2015, p. 1). Besides, Alibaba concentrates on
finding ways of having a considerable portion of the share of the market by focusing on activities
that help in localizing services of e-trade by creating web addresses located on various languages
while modifying operation layouts with designs that suit local culture within foreign places. All
these issues within the target market by Alibaba Company play the essential roles in the global
success of the company.
Conclusion
The improvement of these critical businesses, as well as management issues, has made it
possible for Alibaba to become the most significant online as well as mobile commerce
organization in the globe within just a few years. These factors have made it possible for the very
individual in the global society to expect Alibaba to become so successful in its online operations
within the business community than failing. These issues have provided numerous business
opportunities for every enterprise whether small or medium scale to leverage the innovative
technology to compete more efficiently in the global and domestic marketplace. Ideal foundation
of strong branding image, superior proposition of customer value, huge sales volume, better
experienced gained during shopping, along with excellent economies of scale has made the
organization to remain competitive in the business sector. The other issues that affect its
operations are payment, the existence of the massive internet filtering and censorship engine
referred to as the Great Firewall, disclosures, the structure of the company, valuation, branding,
and image, target marketplace, and trust among other factors. The company has been able to

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escape Western notice for duration over ten years while concentrating on the creation of a base
of client than doubling Amazon's measure in dealing with main internet part of business
exchanges within Chinese marketplaces.

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List of References
'Alibaba’s World: How a Remarkable Chinese Company Is Changing the Face of Global
Business', 2015, Publishers Weekly, vol. 262, no. 8, p. 62.
Kim, S. and Yan, A. (2015). Factors Affecting the Intention to Use of Alibaba Mobile Payment
Service: A Case of Chinese Users. The Journal of the Korea Contents Association, 15(12),
pp.517-524.
Luckerson, V 2014, 'This Is Alibaba's Plan to Take on Amazon and eBay on Their Home Turf',
Time.com, p. 1.
Preimesberger, C 2015, 'Equinix, Alibaba's Aliyun Hook Up for Dedicated Cloud Services',
eWeek, p. 1.
Shen, J. and Kim, M. (2016). A Comparative Research on the Business Strategies of Chinese E-
commerce Firms : Alibaba and Jing Dong. International Business Review, 20(1), p.263.
Watters, C 2017, 'Six Billion Shoppers: The Companies Winning the Global E-Commerce
Boom', Library Journal, vol. 142, no. 16, p. 81.
Xu, X, Li, Q, Peng, L, Hsia, T, Huang, C, & Wu, J 2017, 'The impact of informational incentives
and social influence on consumer behavior during Alibaba's online shopping carnival',
Computers in Human Behavior, vol. 76, pp. 245-254. Available from:
10.1016/j.chb.2017.07.018. [9 April 2018].

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Yu, Y. and Shen, M. (2015). Consumer Protection as the 'Open Sesame' that Allows Alibaba to
Crush the Forty Thieves (Gaining Market Power by Protecting Consumers: A Private Company
Blows China's Banks Away). SSRN Electronic Journal.