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Taobao

In: Business and Management

Submitted By angelamaesy
Words 1077
Pages 5
Management Information Systems
Homework: Alibaba’s Taobao
Angela Mae Jean Sy
12210690780
November 17, 2012

1. What was Alibaba’s motivation for diversifying into the consumer business with the launch of Taobao? Does this make sense?

Jack Ma was alarmed at eBay’s entry into the online selling market, fearing that it would soon encroach on Alibaba’s existing B2B success. Ma knew that once eBay had a firm hold on their individual consumers and sellers, it would be easy for them to transition into a bigger, SME-targeted type of e-commerce. Given eBay’s worldwide dominance, Ma’s fears were not completely unfounded. It was this that motivated Ma to do something to stop eBay in its tracks. Ma’s reaction to eBay’s arrival, however, was not just to find a way to ensure their position as the leading B2B online goods provider. Before eBay could even begin to consider moving horizontally to B2B to facedown the Chinese giant, Alibaba became proactive and decided to expand into C2C, and thus Taobao was born.

2. How did Taobao beat eBay? Taobao was clearly ahead of eBay in many aspects. And while one may argue that eBay had exhibited participation in these aspects as well, they clearly did not do it as well as Taobao did. a. Familiarity with Chinese aesthetics and preference
Alibaba had been founded by a Chinese man, in China, and has ben serving the Chinese market for years. It is only understandable that Taobao had a better concept of what the market wanted. When it came down to the nitty gritty details, those little nuances to a business model could spell the difference. For example, the web interface: Taobao knew that the Chinese preferred busy, packed websites with a lot of links and items to click on. Western design typically favored spares, clean, minimalist looks, with al lot of white space as we can see in successful e-commerce sites like etsy.com…...

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