Ali Faces New Threats From Competitors. The Biggest Threat Is It!

Alibaba group is now dominating the Chinese e-commerce market, but with the emergence of a large number of new competitors in the industry, the current Alibaba is also facing more and more challenges and threats. One of the most obvious threats is Jingdong mall.

Of course, Jingdong mall has been a long-standing competitor of Alibaba.

In fact, in the Chinese market, the hostile relationship between the two companies has been dubbed by the industry as "cat and dog war", which is borrowed from their representative products, that is, the "Tmall mall" of Alibaba group and Jingdong's own online shopping mall.

Alibaba's strategy to maintain the marketing of UNIQLO apparel on its platform also fully shows that this is closely related to Alibaba's interests.

In the past few months, Alibaba and other shopping websites have been trying to attract some famous brand companies through specialized contracts or product distribution methods, and Alibaba has also asked their sellers to offer more discounts.

At the end of April this year, Alibaba founder Ma Yun had a conversation with Tadashi Yanai, the head of Fast Retailing Co of UNIQLO's parent company.

Fast Retailing is Asia's largest clothing retailer. Recently, it sold UNIQLO products in Jingdong mall, and its sales volume was very good.

According to people familiar with the matter, Ma Yun and his team told Ryui Masa that if UNIQLO is more loyal to Alibaba platform, Alibaba will promote further growth in the flow and sales volume of UNIQLO stores on its platform.

UNIQLO once entered Jingdong mall platform, but in July of this year, UNIQLO announced that it had withdrawn from Jingdong mall, claiming that the Jingdong mall was not in line with the e-commerce strategy of UNIQLO.

Jingdong claims that the exit of UNIQLO is definitely "for other reasons than business performance", because in Jingdong mall, UNIQLO's product demand is very strong.

However,

Declined to comment.

Alibaba controls the absolute majority of the total volume of online shopping in China. This dominant advantage can be highlighted by Alibaba's large-scale online store "Taobao".

Taobao now has about 8 million sellers, most of whom are individual sellers.

Comparatively speaking, Jingdong's "pat" trading volume is much smaller, but Jingdong has not disclosed the specific number of businesses on the "pat" platform.

In the first quarter of 2015, Alibaba accounted for about 58.6% of the fast-growing e-commerce market, which is basically the same as the same period last year, according to market research firm AI.

However, the share of Jingdong mall increased from 19.2% in the same period last year to 22.8%.

Alibaba claims that in the fiscal year ending March this year, the group's

The total amount of business pactions on the website reached 2 trillion and 440 billion yuan, which far exceeded the total volume of pactions of the five largest e-commerce companies behind Alibaba group.

However, Alibaba admits that the company is facing more and more competitive pressure.

Nowadays, more and more e-commerce companies are competing for the Chinese Internet consumer market, including jumei.com, vip.com, and the first store bought by WAL-MART in July this year.

{page_break}

Cai Chongxin, vice chairman of Alibaba, said in a media interview that fierce competition "is precisely"

The nature of the industry, especially in the Chinese market.

He said: "the market is huge, and the honor of the profitable market is very attractive. You have a lot of entrepreneurs and money to support them."

As China's economic growth slows down, competition in China's e-commerce market is intensifying.

Alibaba recently released lower than expected revenue report.

Data show that, as of the end of June this quarter, Alibaba revenue of $3 billion 260 million, lower than expected.

It is not hard to see that Alibaba is facing some challenges, such as saturated business trends and ultra-high cost of mobile services pformation.

Last week, Alibaba announced that it would spend $49 to buy sunning Yun's 20% stake, which would impact Jingdong mall.

In recent months, Alibaba has signed a cooperation agreement with more than 160 enterprises, and it is expected that these agreements will increase the volume of Alibaba online shopping mall by 30 billion yuan in the next year.

At least 20% enterprises and retailers plan to sell their products exclusively in Tmall mall, such as Timberland (Tian Bailan), Decathlon and so on.

Shen Haoyu, chief executive of Jingdong mall, said: "we are concerned about the exclusive agreement of Alibaba, but we do not think this will be consistent with the interests and purposes of the brand."

Cai Chongxin claims that the exclusive agreement between enterprises and Alibaba is mainly because they know that "we can push their products".

The two rivals have been fighting against each other.

Last year, Ma had declared that Jingdong would "eventually become a tragedy" - Ma had apologized for this.

In a speech in May this year, Alibaba former Taobao President Zhang Jianfeng once claimed that "as long as Alibaba does anything, Jingdong will immediately follow suit".

At that time, when Zhang Jianfeng said this, he mainly aimed at developing Alibaba to the rural market, strengthening overseas sales business, marching into cloud computing and network payment.

It is said that there are many red banner slogans in an office of Jingdong headquarters in Beijing, one of which is "struggle, struggle, fight to the end, contend for the first!"

{page_break}

In July this year, Jingdong had insinuate Ali fakes, claiming that they should never make money.

In a speech in July this year, Liu Qiangdong once declared that Jingdong is the online shopping platform that should be chosen by quality and authentic consumers.

Unlike Alibaba, Jingdong buys products from loan providers and sells them directly to consumers.

In addition, Jingdong also operates a shopping mall where brands can sell goods and pay commissions to Jingdong.

In fact, Alibaba does not really sell products, but rather connects buyers and sellers by profiting from advertising and other services provided by millions of businesses and individual retailers that use their mall.

A senior brand in Italy chose to open a store in Jingdong instead of choosing Tmall's mall. The senior Brand Company said the move was mainly due to the written promise made by Jingdong to drive the piracy and parallel goods of the brand out of the network.

Jingdong claims that the company protects intellectual property rights of brand owners, whether or not these brands sell products on their website.

At the beginning of this year, Alibaba had persuaded the Swedish high-end outdoor brand Fjallraven to open exclusive stores in Tmall, and promised to increase the volume of the store.

Previously, Fjallraven has been selling products on Jingdong mall and other Chinese websites.

Lin Mingwen, general manager of Fenix Outdoor, Fjallraven parent company, said: "we have got some very good conditions, including more pparency on the website and lower advertising expenses."

Lin Mingwen predicts that Fjallraven's sales volume in the Chinese market will increase by 5 times compared with last year.

Before the deal, Fjallraven had to lower the price on Tmall, which was lower than the similar products on other websites in the Chinese market, so that more promotional and promotional opportunities could be gained on Tmall mall.

Today, Fjallraven has signed exclusive sales agreements with Tmall, so that Fjallraven has a lot of flexibility in pricing.