Swot Analysis Of Alibuba In China - 1093 Words

Introduction: In the year 2016, an e-commerce giant held a one-day sales bonanza that outsold Black Friday and Cyber Monday at all US retailers combined. It was not Amazon’s Prime Day; it was Chinese e-commerce company Alibaba’s â€Å"Singles’ Day Holiday,† in November of 2016, where approximately $17.8 billion worth of goods were sold, according to Business Insider (http://www.businessinsider.com/amazon-prime-day-vs-alibaba-singles-day-2017-7). Alibaba, founded in 1999 by Jack Ma to connect Chinese manufacturers to buyers, has grown into an e-commerce giant with a portfolio of innovative smaller companies working within it. However, the fact that a vast majority of their revenue is generated in China (83% of their revenue from Chinese commerce†¦show more content†¦This is partially motivated by Ma’s acknowledgement that â€Å"the Chinese economy is slowing and that the company s explosive gains in revenue and user additions in China have slowed.† While the Chinese market may still have some growth potential, reaching these massive goals will require global expansion to new markets. The US has a population of well over 300 million, and according to Pew Research, in the year 2015, 84% of American adults used the internet regularly (http://www.pewinternet.org/2015/06/26/americans-internet-access-2000-2015/ ), compared to China’s tightly restricted internet. Thus, Alibaba would be wise to expand into this country full of technologically active potential users. Relatedly, American firms Amazon and eBay both once sought a greater share in the Chinese e-commerce Market. Examining these companies provides an interesting lens for Alibaba’s potential expansion into the United States, as these companies faced a similar culture shock between China and the US. eBay attempted this entry in 2004, but failed due not comprehending the needs and wants of Chinese consumers (http://onlinelibrary-wiley-com.uml.idm.oclc.org/doi/10 .1002/tie.21739/full ), while Amazon entered in 2004 by purchasing Joyo.com, a book and music vendor. Although Amazon did not flame out in the manner of eBay, its share of the Chinese e-commerce market has hovered down around 1.5%. Both Amazon and eBay encountered