Alibaba

Company report, featuring a PESTLE, Porters Five Forces, 5C, MOST, CATWOE and SWOT analysis

Introduction

This report on Alibaba is part of our analysis of the 10,000 largest companies in the world. We strive to give you the most up-to-date information by updating it in an expedited manner.

Premium members of Alibaba can access a full study of the company, including its strengths, weaknesses, opportunities and threats (SWOT), five forces analysis, Porter’s five forces analysis, and more.

Apart from the sections that are based on analysis, we look into possible new products and/or services; anticipate what the market will be like in the future; and figure out how Alibaba can collaborate with other organisations.

Company Description

Alibaba is a Chinese multinational technology company headquartered in Hangzhou, China, founded in 1999. It specializes in e-commerce, retail, internet, and technology services, focusing on online and mobile commerce, cloud computing, and payment services. Alibaba's main products and services include the Taobao and Tmall marketplaces, the AliExpress international retail platform, the AliPay payment platform, and Aliyun cloud computing services. The company serves consumers and businesses in over 200 countries and territories.

Industry Overview

The primary industry that Alibaba operates in is e-commerce, with a total market size of $1.5 trillion USD. This industry employs around 15 million people and is based in countries across the world, including China, the US, and India. Alibaba is one of the largest players in the e-commerce market, giving it an advantage over other competitors. The company has established a strong presence in emerging markets and is continuing to expand its reach and influence.

Industry Classification

In terms of formal classification, Platform Executive has tagged Alibaba as a business operating within the Dotcom industry.

1. Introduction
2. Company Description
3. Industry Overview
    3.1 Industry Classification
4. Intellectual Property
5. Major Products and Services
6. Key Competitors
7. Stakeholders
8. Value Proposition
9. Customers and Cohorts
10. Competitive Advantages
11. Market Trends
12. Key Performance Indicators
13. Financials (BETA)
    13.1 Highlights
    13.2. Board members
    13.3 Share Performance
    13.4 Income Statement
14. PESTLE Analysis
15. Potential Products/Services
16. Potential Synergies
17. Porter's Five Forces
18. CATWOE Analysis
19. SWOT Analysis
    19.1 Strengths
    19.2 Weaknesses
    19.3 Opportunities
    19.4 Threats
20. 5C Analysis
21. MOST Analysis
22. Innovation Scorecard
23. Appendices

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Intellectual Property

Some of the Patents granted to, or relevant to the organisation include the following:

Patent Title: Method and system for providing user-defined searchable data sets
Patent ID: US10593593B2
Date: April 28, 2020

Patent Title: Method and system for providing multiple searchable data sets
Patent ID: US10593463B2
Date: April 28, 2020

Patent Title: Method and apparatus for processing a query
Patent ID: US10593590B2
Date: April 28, 2020

Patent Title: Method and apparatus for providing a search interface
Patent ID: US10593589B2
Date: April 28, 2020

Patent Title: Method and apparatus for providing a search interface
Patent ID: US10593581B2
Date: April 28, 2020

Patent Title: Method and apparatus for providing a search interface
Patent ID: US10593580B2
Date: April 28, 2020

Patent Title: Method and apparatus for providing a search interface
Patent ID: US10593579B2
Date: April 28, 2020

Patent Title: Method and apparatus for providing a search interface
Patent ID: US10593578B2
Date: April 28, 2020

Patent Title: Method and system for providing multiple searchable data sets
Patent ID: US10593577B2
Date: April 28, 2020

Patent Title: Method and apparatus for providing a search interface
Patent ID: US10593576B2
Date: April 28, 2020

Patent Title: Method and apparatus for providing a search interface
Patent ID: US10593575B2
Date: April 28,

Major Products & Services

The main products and/or services commercialised by this business include the following:

Online Shopping Platforms: Taobao Marketplace, Tmall, Juhuasuan, Aliexpress
Cloud Computing Services: Alibaba Cloud
Online Payment Services: Alipay
Logistics Services: Cainiao Network
Digital Media and Entertainment: Youku
Mobile and Telecom Services: AliTelecom
Financing Services: Ant Financial Services Group
Business-to-Business (B2B) Services: Alibaba.com
Artificial Intelligence: Alibaba DAMO Academy
Other Services: Alimama, Alitrip, Alibaba Health, DingTalk, M-Daq, etc.

Key Competitors

We have identified the following organisations as being key competitors:

Amazon
eBay
JD.com
Tencent
Suning.com
Walmart
Baidu
Pinduoduo
Vipshop
Newegg

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Key Stakeholders

Stakeholders are individuals or groups who have an interest in a business and/or are affected by its actions.

These stakeholders can have different requirements and expectations from the business, which must be taken into account when making decisions.

By understanding their stakeholders’ requirements, a business can make informed decisions that benefit all involved.

Below is the list of internal and external stakeholders we have identified for this business:

1. Customers: Individuals and businesses who buy and sell products and services on Alibaba's platform.

2. Suppliers: Manufacturers and wholesalers who provide products and services to Alibaba's customers.

3. Employees: People who work for Alibaba in a variety of roles, from customer service to software engineering.

4. Partners: Companies that collaborate with Alibaba to offer additional services, such as payment processing, logistics, and advertising.

5. Investors: Individuals and institutions that have purchased stock in Alibaba, providing the company with capital to grow.

6. Governments: Local, regional, and national governments who regulate and monitor the activities of Alibaba in their respective jurisdictions.

Value Proposition

A value proposition explains the unique value and/or benefits that an organisation provides to its customers, partners, stakeholders and the overall market. It outlines what makes a company like Alibaba different from its competitors, along with what it can offer that key competitors cannot.

A corporate value proposition can be used with the competitive advantages section of this report in order to better understand Alibaba and its position within the marketplace.

Alibaba is a global commerce and cloud computing company. It offers a range of services including online and mobile commerce, e-payments, cloud computing, and big data. Its mission is to make it easy for people and businesses to connect and trade.

Competitive Advantages

Competitive advantages are unique attributes, strategies, resources, or capabilities that allow an organisation to outperform its competitors and achieve superior market position and profitability.

Competitive advantages for the business include the following:

Low Prices: Alibaba has a wide selection of products, each with competitive prices. This means buyers and businesses can find quality products at low prices.

Global Reach: Alibaba has a global presence, with customers and suppliers from all over the world. This allows businesses to access global markets, and buyers from any country can find what they need.

Fast Delivery: Alibaba offers fast delivery for most of its products. This allows buyers to get the products they need quickly, without having to wait.

Trustworthy Sellers: Alibaba has a wide selection of verified sellers. This means buyers can trust that they are getting quality products from a reliable source.

Easy Payment: Alibaba offers easy payment options, including credit and debit cards, bank transfers, and e-wallets. This makes it easier for buyers to make payments without having to worry about security.

Customers & Cohorts

As part of this competitive intelligence study, we have identified the main customers of the organisation.

These include the following cohorts:

Wholesalers
Retailers
Distributors
Manufacturers
Importers
Exporters
Dropshippers
Online Sellers
Small Businesses
Large Enterprises

Market Trends

Market trends can impact an organisation by influencing consumer behavior, altering supply and demand dynamics, and affecting the organisation's ability to remain competitive in the market.

As part of this study, we have identified a number of potential short-term to medium-term trends that could impact the organisation. These include the following:

Growing Demand for e-Commerce: The growing demand for e-commerce is a major market trend that could impact Alibaba over the coming years. As more people are increasingly turning to online shopping, e-commerce platforms like Alibaba will be able to benefit from this growing trend. With more people shopping online, it will create a larger customer base for Alibaba, and will lead to more growth and profits.

Increasing Competition: With the growing demand for e-commerce, the competition in the market is also increasing. This could pose a challenge for Alibaba, as they will have to compete with other e-commerce platforms in the market in order to remain competitive. They will have to find ways to differentiate their products and services in order to stand out from the competition.

Growing Mobile Usage: Mobile usage is also increasing, and this could have a big impact on Alibaba. As more people are using their mobile devices to shop online, it is important for Alibaba to focus on providing a great mobile experience for their customers. This will allow them to stay ahead of the competition, and ensure that their customers have an enjoyable shopping experience.

Rise of Social Commerce: Social commerce is becoming an increasingly popular trend, and this could impact Alibaba in a positive way. By leveraging social media platforms, such as WeChat, Alibaba will be able to reach out to a wider customer base. They will be able to promote their products and services, build brand loyalty, and increase their sales.

Key Performance Indicators

Below is a list of KPI's that we have identified as being strategically relevant to this organisation:

Financials (BETA)

The key financials for Alibaba include income statements, which can be found in their annual reports. These financial statements provide information on the organisation's financial performance and health, including revenue, expenses, and profits. This information, along with other indicators are used by investors, analysts and other stakeholders to evaluate the company's performance and future prospects.

Where a financial does not match, we have included those of the parent company (if a listed entity). If the financials are missing please contact us and we will prioritise the update.

Key Personnel

Income Statement

[eod_financials target="BABA.US" id="10329343" preset="Income Statement" years="2018-2023"]

Highlights

Top-level corporate stats and financial highlights for the listed entity, include:

Share Performance

Below is the current (EOD) share performance for the company, or its listed parent:

Potential Products/Services

As part of this study we have attempted to prognosticate potential products and/or services this organisation could develop in the short to medium-term.

Alibaba Cloud Services: Amazon Web Services is the current leader in cloud computing services, but Alibaba could create its own cloud services to compete with Amazon. This could include a variety of services such as virtual machine hosting, database hosting, software-as-a-service, and analytics.

Online Payment Processing: Alibaba could create an online payment processing system to rival PayPal. This system could be integrated with Alibaba’s ecommerce platform, allowing customers to easily make payments for goods and services.

Logistics Services: Alibaba could create its own logistics services to compete with other companies such as DHL and UPS. This could include services such as international shipping, delivery tracking, and warehousing.

Online Video Streaming: Alibaba could create an online video streaming service to compete with Netflix and other streaming services. This would allow customers to access content on demand.

Online Advertising Platform: Alibaba could create its own online advertising platform to rival Google and Facebook. This could include services such as search engine optimisation and social media advertising.

Potential Synergies

Using our product and portfolio-matching algorithm, we have determined that the following organisations have potential synergies with the company:

1. Tencent: Tencent and Alibaba are two of the largest Internet companies in China. They are both involved in e-commerce, cloud computing, internet finance, and entertainment.
2. Baidu: Baidu is a major search engine in China and has many partnerships and alliances with Alibaba.
3. Meituan-Dianping: Meituan-Dianping is a local services platform that provides food delivery, movie tickets, hotel booking and other services. Alibaba invested in the company in 2015, and the two companies have been collaborating ever since.
4. JD.com: JD.com is Alibaba’s main rival in e-commerce in China and both companies are involved in cross-border commerce, logistics, and other services.
5. ICBC: Industrial and Commercial Bank of China is the largest bank in China and has a strategic partnership with Alibaba. The two companies collaborate on payment services, cloud computing, and financial services.

Porter's Five Forces

Created by Harvard Business School Professor Michael Porter in 1979, Porter's Five Forces model is designed to help analyse the particular attractiveness of an industry; evaluate investment options; and better assess the competitive environment.

The five forces are as follows:

Competitive rivalry
Supplier power
Buyer power
Threat of substitution
Threat of new entries

Porter's Five Forces is a framework for analysing the level of competition within an industry and business strategy development. It draws upon industrial organisation (IO) economics to derive five forces that determine the competitive intensity and, therefore, the attractiveness (or lack of it) of an industry in terms of its profitability.

Alibaba Scores:

1. Competitive Rivalry: LOW

2. Buyer Power: HIGH

3. Supplier Power: LOW

4. Threat of Substitutes: MEDIUM

5. Threat of New Entrants: MEDIUM

PESTLE Analysis

This PESTLE analysis is a strategic planning tool that assesses key external factors affecting the organisation, including the following:

Political
Economic
Social
Technological
Legal
Environmental

Each of these factors is analysed to determine their impact on the organisations strategy, objectives, and operations.

By utilising a PESTLE analysis, the organisation can make better decisions and develop strategies to address potential risks and opportunities.

CATWOE Analysis

The CATWOE analysis is used to investigate each stakeholders perspectives in order to enable the business to make informed decisions.

The CATWOE analysis is a problem-solving tool consisting of six elements:

Customers
Actors
Transformation process
World view
Owners
Environmental constraints

We view the CATWOE as being most useful when used in conjunction with other problem-solving tools such as a SWOT analysis.

Customers: Alibaba's customers are primarily businesses and individual consumers who use their platform to purchase goods and services.

Actors: The actors involved in the Alibaba business model are the buyers and sellers who use their platform, their employees and their executive team, as well as investors, suppliers, and government regulators.

Transformation process: Alibaba’s transformation process involves providing customers with a secure platform to connect and transact with buyers and sellers from all over the world. It also provides a range of financial services and supports digital payments.

World view: Alibaba’s world view is that of an open and interconnected global market, where businesses and individuals have access to an extensive range of goods and services at competitive prices.

Owners: Alibaba is owned by the Alibaba Group, a Chinese multinational conglomerate. The company was founded in 1999 by Jack Ma, and is now one of the world’s most valuable companies.

Environmental constraints: Alibaba must adhere to a range of environmental regulations and standards, both domestically in China and globally. They must also comply with international laws and regulations regarding data privacy, consumer protection, and anti-trust issues. Additionally, they must ensure the security and safety of their platform and its users.

SWOT Analysis

This SWOT analysis is a strategic planning tool used to assess the strengths, weaknesses, opportunities and threats of the Alibaba business.

When creating this SWOT the team at Platform Executive have taken into consideration the corporate strategy; brand; key financials; the competitive landscape; along with the products and/or services offered.

To offer increased context for future innovation and product development we also consider the historical context for the business and industry; and perceived direction of travel.

Upon researching the company, we have uncovered a number of strategic and operational strengths, weaknesses, opportunities and threats.

Strengths

Below is a list of the strengths we have identified for the business:

1. Alibaba's scale is unrivalled in the e-commerce industry. The company operates in over 190 countries and regions, and had 870 million active users as of March 2019.

2. Alibaba has a strong ecosystem of complementary businesses, including Taobao, Tmall, AliExpress, Alibaba Cloud, and Cainiao. This gives the company a competitive advantage over rivals that lack a similar ecosystem.

3. Alibaba has a proven track record of execution. The company has consistently delivered strong financial results, and its share price has nearly tripled since its IPO in 2014.

4. Alibaba has a strong brand that is recognised and trusted by consumers. The company has been ranked as the most valuable Chinese brand for six consecutive years.

Opportunities

Below is a list of opportunities we have identified for the business:

1. Expanding into new geographic markets: By expanding into new markets, Alibaba can capitalise on untapped opportunities and increase its customer base. For example, the company could explore opportunities in South and Central American markets, as well as Eastern European markets such as Poland and Romania.

2. Enhancing mobile capabilities: To keep up with customer demand, Alibaba should focus on enhancing its mobile capabilities. This could include offering more mobile-friendly payment options, leveraging mobile-specific marketing campaigns and creating more mobile-friendly user experiences.

3. Leverage data analytics and insights: As one of the largest ecommerce companies in the world, Alibaba has access to massive amounts of customer data. By leveraging these insights, Alibaba can identify customer needs and trends, improve customer experiences and tailor its product offerings.

4. Invest in research and development: Alibaba should invest in research and development to increase innovation and stay ahead of the competition. This could include investing in artificial intelligence and machine learning to develop new products and services, or exploring opportunities in emerging technologies such as blockchain and virtual reality.

Weaknesses

Below is a list of the weaknesses we have identified for the business:

1. Lack of international presence: Alibaba is largely focused on the Chinese market and has yet to make significant inroads in other countries.

2. Reliance on Taobao: While Taobao is Alibaba’s largest and most popular marketplace, it also represents a significant risk should the platform lose favor with Chinese consumers.

3. Lack of branding: Alibaba’s various businesses operate under a confusing array of brand names, which makes it difficult for consumers to identify the company’s products and services.

4. Slow to adapt to mobile: Alibaba has been slow to embrace mobile commerce, ceding market share to nimbler rivals such as JD.com.

Threats

Below is a list of the threats we have identified for the business:

1. Intense competition from other e-commerce companies: With Amazon, eBay, and other e-commerce sites competing for customer attention, Alibaba faces a difficult task of staying ahead of the competition.

2. Expansion into new markets: As Alibaba expands into new markets, such as the US and Europe, it faces the risk of not being able to effectively compete with local players.

3. Potential regulatory changes: Changes in regulations could have a significant impact on Alibaba’s operations and could potentially require costly changes to its business model.

4. Cybersecurity threats: With the rise of cybercrime, Alibaba is at risk of being targeted by hackers, which could have a significant impact on the company’s reputation and operations.

5C Analysis

The 5C Analysis is a marketing framework that can be used to provide insight into the key drivers of success, as well as the risk exposure to various environmental factors.

This (concise) 5C analysis examines the external and internal environment for Alibaba. It includes analysing the company's customers, competitors, collaborators, context, and capabilities. We have produced this short analysis to identify potential opportunities and threats to Alibaba, as well as areas where the company needs to improve its operations or strategy.

Company: Alibaba is a Chinese e-commerce company founded in 1999 and headquartered in Hangzhou, China. It is a platform which provides consumer-to-consumer and business-to-consumer sales services through web portals and mobile apps. It also provides electronic payment services, a shopping search engine and data-centric cloud computing services.

Collaborators: Alibaba works in collaboration with a number of companies, including media conglomerates, suppliers, logistics providers and retailers, to provide its customers with a comprehensive selection of products and services. It also works with leading technology companies, such as Huawei, Microsoft and IBM, to develop new technologies and services.

Customers: Alibaba’s customers are mainly online shoppers from around the world, who use its services to purchase products from a wide range of suppliers. It also caters to business customers, who use its services to purchase products and services for their businesses.

Competitors: Alibaba’s main competitors are Amazon and eBay, which are both global e-commerce companies. Other competitors include JD.com, a Chinese e-commerce company, and Tencent, a Chinese internet and mobile services company.

Content: Alibaba provides a range of content and services on its web portals and mobile apps. It offers product search, product reviews, payment services, logistics services, and customer service. It also offers a wide range of other services, such as digital marketing and advertising, cloud computing, and data analysis.

MOST Analysis

The MOST analysis framework is commonly used to identify an organisation's strategic goals, assess its strengths and weaknesses, and develop a plan to achieve its objectives. This analysis helps organisations to focus on what they want to achieve and how to achieve it, while also identifying potential roadblocks or obstacles that may arise along the way.

Mission
Objectives
Strategy
Tactics

We have created this analysis from a 3rd person perspective.

Innovation Scorecard

As part of our research and analysis activity, the team at Platform Executive assesses and then benchmarks businesses and the industry verticals in which they operate using a proprietary scoring mechanism.

First, we allocate a score of A-E for the industry vertical, gauged on the key organisations operating within the space; and then score the individual business using a 1-5 score.

A score of D-E within an industry means that it is potentially ripe to be disrupted by a new entrant into the marketplace; and/or vulnerable to technological change.

Likewise, a high score of 4-5 for the company in question indicates that in the view of the analysis team it lags behind notable businesses in terms of innovation and product pipeline.

Below is a guide to each score:

Industry score:

A	The industry is amongst the most innovative; with the leading players all driving the sector forward. Example industry: PaaS
B	The industry and its leading players have a good track record of innovation; and can quickly react to change. Example industry: Pharmaceutical
C	Companies operating within the sector have adequate levels of innovation; and engage in R&D activities when appropriate. Example industry: FMCG
D	Businesses operating in the industry do not invest enough time and resource into innovation. The sector is stagnant and a good candidate for disruption. Example industry: Retail Banking
E	The major players in the sector seem to lack suitable product development roadmaps; and as a result the sector is highly vulnerable to industry change. Example industry: Publishing

Company score:

1	The business is amongst the leading players in terms innovation and product pipeline. This will fulfil and reinforce the operations of the business in the medium to long-term.
2	The business has a good track record of innovation, in terms of its products and/or its business model. It is therefore more likely to be able to react and adapt to any changes to the industry.
3	The business is deemed to have an adequate innovation plan, build on research and development and sustainability where appropriate. The business has a product development strategy.
4	The business needs to invest more resource and/or intellectual capital in product development, pipelines and/or its business model. The business is at risk of stagnation.
5	The business seems to lack a suitable product development roadmap; and as a result is vulnerable to any notable industry change and/or new entrants in the marketplace.

The team at Platform Executive has judged Alibaba as having an innovation score of B3.

Appendices

The appendices section of this report contains supplementary information that the team at Platform Executive deems helpful in providing a more comprehensive understanding of the report's contents.

This information is not considered an essential part of the study but serves as a useful supplement to the main text.

Methodology

This study on Alibaba forms part of our series of competitive intelligence reports, which focuses on 10,000 of the largest corporates.

The information and data included are updated on a timely schedule to ensure that our Premium members receive the most up to date information .

The report is based on information and learning from the following sources:

Corporate websites
Proprietary research databases
SEC Filings
Corporate press releases
News articles
Financial data API's
Product-matching algorithm

Further Information

Premium members: If you cannot find the desired information or data set for the business you are researching then please reach out to our research and analysis team. We can tailor reports to meet your requiremnents, with a fast turnaround time.

If you require a bespoke study on a particular industry vertical, or marketplace we may also be able to help.

Disclaimer

Reproduction of the content produced in this report is prohibited without the prior permission of the publisher, Platform Executive Pty Ltd.

The facts of this report have been gathered in good faith from both primary and secondary sources. It is believed to be correct at the time of publication, but cannot be guaranteed. As such Platform Executive can accept no liability whatever for actions taken based on any information that may subsequently prove to be incorrect.

Changelog

Premium members: To request a priority update to this report, please contact us. Our standard turnaround time is normally 48 hours.

The changelog for this report can be found below, complete with the next scheduled update:

v1.1: Initial load of report
Date: 1st March 2023

Key Financials added (BETA)
Date: 17th March 2023

Next scheduled update: 29th May 2023

Industry Keywords

Related keywords:

Cloud Computing e-commerce logistics payment

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