Alibaba Taobao's Essay

824 Words Jun 26th, 2015 4 Pages
Alibaba Taobao
Introduction
Founded by Alibaba Group on May 10, 2003, Taobao Marketplace facilitates consumer-to-consumer (C2C) retail by providing a platform for small businesses and individual entrepreneurs to open online stores that mainly cater to consumers in Chinese-speaking regions (Mainland China, Hong Kong, Macau and Taiwan) and also abroad.
Taobao Marketplace (formerly "Taobao") was launched in May 2003 by Alibaba after eBay acquired Eachnet, China’s online auction leader at the time, for USD 180 million and became a major player in the Chinese consumer e-commerce market. To counter eBay’s expansion, Taobao offered free listings to sellers and introduced website features designed to act in local consumers' best interests,
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Evaluate e-Bay’s decisión to enter China.
Ebay entered the Chinese market in 2003/2004 and was actually doing well in the beginning because China's C2C online industry was pretty much non-existent at that time. Ebay came in with a load of cash and quickly caught people's attention.
Also, more than 50% of global Internet population is in China, and that number is growing fast.
Evaluate Taobao’s growth strategy and execution, what would be the biggest challenges for the Taobao’s global expansion?
When Ebay launched in China it had global revenues of more than $2bn. As a young, domestic entity, Taobao was taking on a huge rival while also fending off many similar small competitors in the sector, where barriers to entry were low.
But TaoBao had a better grasp of what makes Chinese consumers tick, The buyers really want to get to know the sellers.
TaoBao helps buyers and sellers simulate close personal relationships and build something called “swift guanxi.” This is a Chinese concept “broadly defined as a close and pervasive interpersonal relationship” and “based on high-quality social interactions and the reciprocal exchange of mutual benefits.” And For U.S. companies who want to do business in China, they have to understand this concept.
In building TaoBao, Ma understood swift guanxi, and he equipped his

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