Company Background
Alibaba Company was founded by a former Chinese English teacher, Jack Ma, together with other eighteen partners, in 1999. Way back from its founding, the corporation was sustained by a belief that, within the global and the domestic economy, the internet would allow upcoming businesses to influence technology and business innovations to compete fully and develop. Since the unveiling of the company's first website which assisted entrepreneurs, exporters and manufacturers carry out international sales and marketing processes, the company has taken the lead in mobile and online commerce. In contemporary e-commerce marketing, the corporation and its associates manage and sustain international standard retail and wholesale markets and other enterprises which are internet-based. Alibaba additionally provides electronic payments, mobile solutions, marketing and advertising services, network services, and cloud computing among others. The Company aims at ensuring the complete construction of effective internet commerce infrastructure, to last for at least a century and to attract their consumers to live and work at the corporation (Wright, 2014).
Industry and Competitors
Alibaba Company is the largest and one of the most developed e-commerce businesses in China. The corporation is mainly a domestic enterprise, a term which may sound restricting; however, taking into consideration the large numbers of involved users in internet discovery within the country, the appeal becomes very evident. By the end of 2013, the country had over six hundred million internet users, according to the CNNIC report. The figure was increased by approximately ten percent in the following years. However, it only represented less than half of the total Chinese population, hence offering the promise of even more potential for growth within the coming years. The corporation mainly functions through three sites and also stakes a lot. The company operates through sites including; Tmall, Alibaba.com, and Taobao. These sites enable the company to offer a reliable shopping place for its customers, effectively connect different mega- companies to the country's exporters and specialize on the middle class while also concentrating on the sales and marketing of branded products, through their online platforms. These sites additionally accommodate millions of enterprises and also support a million users through these sites. The huge numbers served by the corporation therefore almost qualifies the company as a worldwide online corporation. The Alibaba Corporation also has its payment scheme, known as Alipay.com, which is like the PayPal system, and its "Twitter and YouTube" platforms named Youku Tudou (“Alibaba.com; Feasibility Study and Business Plan,” 2016).
The company’s main competitors are the Amazon, eBay, and Baidu among other minor competitors within the country. Amazon, founded in 1944, has a framework which resembles traditional retailing strategy since it involves in direct sales supported by its warehouses and distribution services and services. Amazon has also attracted and maintained the good customer experience and satisfactory services. Another competitor is eBay which has a much closer make up when compared to Alibaba since is also connects both sellers and buyers through an online platform. Additionally, eBay has also put in place payment systems similar to the one used by Alibaba. Therefore in place of AliPay, eBay uses PayPal. Both Amazon and Alibaba are leading enterprises in their respects, therefore, since these two corporations operate in two different fields, it makes it more unlikely for them to collide in a major way businesswise, thus leaving eBay as its most threatening competitor in the market. It is similarly difficult for Alibaba to penetrate eBay's brand recognition. However, the two companies can be able to compete fairly against each other in countries or regions outside China and the US. Finally, is Baidu, in China, this is an example of an upcoming competitor. Baidu was founded fifteen years ago by Robin Li., and is one of the most prominent internet search engine which actively campaigns for online to offline services, therefore building demand for the physical product through online stores which can be accessed by the internet and smartphones (Wright, 2014).
Alibaba’s Financial Position
The recent Wall Street shareholders’ success story, Alibaba Corporation, recorded one of the strongest financial years in 2014. Within the year, one of the most admired achievements by the corporation included an over- subscribed 8 billion dollars in sales of its bonds and an above average increase in stock price together with a 25 billion dollars IPO. To support the improvements that have been realized from the financial perspective, the corporation has set in place its main ambitions which include maintaining its grand financial position in the e-commerce industry. In 2015, the company recorded even more improved financial success due to the record growth rates which are simply astonishing. The Alibaba sites; Tmall and Taobao, have consistently recorded improvements in sales. The ever increasing number of Chinese market internet penetrations and the developing numbers of internet users who prefer to shop online have continued to increase the demands of e-retailing in the country, therefore, even better financial gains and improvements. Additionally, Alibaba Corporation has heavily and wisely invested in its multi-national expansion and other ventures; these steps will ensure that the sales are fueled during the coming years, for even better financial achievements. Nevertheless, due to the increase in investments and high expenses used for operational purposes, the financial possibilities may dwindle on an annual basis (“Alibaba Group,” 2015).
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How Technology is utilized by the Corporation
The company first application of information technology was the establishment and presentation of its website, Alibay.com. The website was useful in connecting mega industries and exporters for efficient business. The technology, therefore, allowed potential investors and sellers from all over the planet locate and transact with Alibaba. The company additionally uses its Tmall and Taobao websites to offer efficient shopping and distribution of the company’s branded products in different regions. The corporation has also used the technology to establish and maintain an online payment system, which is similar to PayPal. Just the way Twitter and YouTube have enabled business efficiencies to many ventures all over the world, the Alibaba Corporation has employed the use of social media platforms in its operations, such as Youku Tudou. The company has also utilized technologies like advanced logistics operations and cloud computing. Since the company has greatly expanded regarding employees, it has therefore shown full dedication to employing the assistance of different technologies to collaborate and effectively integrate all its operations aimed at supporting close to 80% of e-commerce enterprises within the country. Based on the fast growing e-commerce, the corporation has also overseen the establishment of smartphone technology which has grown byapproximately75%. The consumers have also displayed a liking for the Alibaba smartphones, and they have increasingly used these smartphones to shop at the same online market. Through these technologies which are used by the corporation, the firm has therefore recorded very high developments and even anticipated growths regarding online payments systems and use of smartphones among other e-commerce practices (“Alibaba.com; Feasibility Study and Business Plan,” 2016).
Alibaba Group SWOT Analysis
The company has threats, strengths, opportunities and weaknesses which have been realized through SWOT analysis. These factors are very fundamental in the administrative functions are keenly discussed in this segment.
Strengths (S)
The company is supported by a team of three from, Japan, China, and Britain. This team enables the company expand its customer base and facilitate the exchange of useful information in these regions. The team also strengthens business relationship between these countries, therefore, creative a very healthy and conducive business environment, therefore, widening its influence. The company also enjoys the impact of the largest Chinese business platform which has increased the convenience of the company's partners and website visibility. The company has also successfully ensured that information is appropriately segmented to increase its efficiency. The company has also managed to establish much more secure internet-oriented transactions to increase security and build the trust of its potential clients.
Weaknesses (W)
Some of the weaknesses which may harm Alibaba is its large and cluttered business portfolio whose administration and sustenance pose a much more serious to the management regarding financial supports and human resource management. The company has approximately 900 industry categories. Secondly, the bid by management to include membership fee to support the company's need to improve may also lead to resignations by some of its most professionally experienced employees, and this may compromise the company's development.
Opportunities (O)
Several opportunities have been created by the growing number of credit corporations and banks which form the basis of e-commerce. The company has also benefited from the flexible e-commerce legal provisions which have seen a regulated and secure environment conduct business. Moreover, the consistent improvements and developments of the Internet, the increasing use of smartphones and computers have seen the online businesses popularized hence facilitating their growths.
Threats (T)
The development of this organization has been compromised by security issues regarding the payment systems. The company is also threatened by some laws which tend to limit their operations. Additionally, the distribution services which are offered by the company have been compromised by poor infrastructural developments in most parts of the country. Another major threat is the continued development of existing e-commerce markets and the upcoming potential competitors like Baidu, which also show a huge growth capability (“Alibaba Group,” 2015).
Trends and Disruptive Technologies to Watch
The trends in technology to watch include the developing applications which are used mainly by smartphones holders. Together with cloud computing and the introduction of different online payment systems, the development and accomplishment of objectives have tremendously changed for both the better and the worse. The explosions of different technologies have seen most companies increase their competitive advantages and also be more equipped and efficient. These technologies can benefit Alibaba Corporation and at the same time increase its risks of being surpassed by competitors (“Alibaba.com; Feasibility Study and Business Plan,” 2016).
Conclusion
In summary, Alibaba Corporation has the potential to grow in the coming years. The financial analysis of the company has shown steady financial developments within the past five years. Through the analysis of the strengths, threats, weaknesses and opportunities of the companies, the corporation can, therefore, use the information to strategize by using evidence-based findings. The company should also try to maintain the satisfaction and loyalty of its customers to ensure it maintains its position
References
Alibaba Group. (2015). Alibabagroup.com. Retrieved 19 April 2016, from http://www.alibabagroup.com/en/about/history
Alibaba.com; Feasibility Study and Business Plan. (2016). Google.com. Retrieved 19 April 2016, from
https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=14&cad=rja&uact=8&ved=0ahUKEwib-6Opo5rMAhVEVxoKHYnYBzQQFgheMA0&url=http%3A%2F%2Fwww.51lunwen.org%2FUploadFile%2Forg201009101017406801%2Falibaba.com.pdf&usg=AFQjCNENzUtST0a113HL89gOVDl_tsdHvg&sig2=w_C9WzeT11xPT6WCM8JHng&bvm=bv.119745492,d.d2s
Wright, C. (2014). So What Exactly Is Alibaba?. Forbes. Retrieved from http://www.forbes.com/sites/chriswright/2014/09/16/so-what-exactly-is-alibaba/#286125c81574
