Case: Alibaba Competing in China and Beyond
Electric commerce (e-commerce) is the buying and selling of products or services over an electronic medium like the internet. The advantages of e-commerce are speedy transactions, less travel, low operational costs, ability to reach a large customer base, and round the clock buying and selling. Some of the disadvantages of e-commerce are the minimum amounts of customer to company interactions which leads to trust issues, e-commerce is prone to fraud and theft, and there is no guarantee on product quality. In a market like China, it's important to understand the local culture, values, the political government, and the language. The political government in China has a major impact on the Internet companies in China. It is important for e-commerce companies in China to understand how to successfully launch a Chinese language website or design a search engine that would suit the complex language. In order to gain an edge amongst their competitors, international companies must seek out local help to understand the local culture and values, the language, the consumers, and how to deal with the politics of the region. Alibaba, founded by Jack Ma, is a website which allows for buyers and sellers all over the globe to engage in electronic business transactions. Alibaba played a major role in bringing the Internet Revolution to China. Ma achieved this by allowing small and medium-size enterprises (SME) in China to benefit from cross border trade through his website. Alibaba made their money from the 21 million users who paid annual subscriptions. Alibaba established itself when the Chinese Internet industry was still in its infancy. This was the perfect opportunity for e-commerce companies because of the lack of competition. However, the competition that they did face were Global Sources and MeetChina, which were also launched in 1999. In order to gain a competitive advantage in the B2B market Alibaba did not charge...
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