What Advantages Do Amazon And Alibaba Have?

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The market competition in Southeast Asia has become a hot topic in the media.

The US media predicted that in the next few years, the two giants will launch fierce confrontation on the Southeast Asian market.

However, Cai Chongxin, executive vice-chairman of Alibaba group's board of directors, said in Hongkong on Thursday that Alibaba is trying to avoid positive competition with Amazon.

In the light of what Alibaba CEO Zhang Yong said before, "global expansion is a slow process", we can see that Alibaba's global layout is moving slowly and steadily, and the confrontation with international giants such as Amazon will not rush for a while.

In the globalization layout, Alibaba adopts the strategy of "encircling the cities by the countryside" and has always been targeting the developing countries' markets.

Compared with developed countries such as the United States, these developing countries have a large number of users and have huge room for development.

Cai Chongxin said, in the future competition, we do not know where it is.

But in the globalization strategy of Alibaba, India and Southeast Asia are the most important positions at present.

The market in this area has been rapidly rising after China, and it has become a battleground for the international giants.

Southeast Asia

It is very complicated. Because each country has different cultures, its policies on import and export trade are also different, and the market is fragmented.

In addition, the backward infrastructure in Southeast Asia has also increased difficulties in delivering logistics and express delivery.

These conditions are almost the same as those in China many years ago. Can Ali's successful experience in China help to expand its market in Southeast Asia?

The layout of Ali in India and Southeast Asia: logistics and payment

In the battle for India market, Amazon has become one of the three big business giants, competing with India's local Flipkart and Alibaba's Snapdeal.

The strategy of Alibaba in Southeast Asia is to expand through investment and establishing strategic partnership. On the one hand, we should turn our attention to the electricity providers, especially those with obvious advantages in logistics. As a breakthrough point, they will be ready to enter the local electricity supplier market and establish logistics network. On the other hand, they will pay close attention to the payment field, and build the ecosystem in Southeast Asia with e-commerce and logistics.

In April this year, Alibaba invested $1 billion to acquire Lazada, an e-commerce platform with the influence of Southeast Asia Amazon and its influence across six Southeast Asian countries. After that, Singapore's online grocery store's Redmart revenue capsule was acquired through Lazada.

Alibaba's ant gold clothing not only creates more payment application scenarios in Southeast Asia and the world through Alipay+, but also exports its inclusive financial model to other developing countries to expand its global business.

Last year, the ant gold clothing was invested in the "India Alipay" Paytm, which not only brought funds to Paytm, but also shared the technology and operation mode of its financial technology with Paytm.

In the meantime, Paytm users jumped from about 20000000 to 150 million, becoming the fourth largest electronic wallet in the world.

At the beginning of this month, ant gold clothing announced a strategic cooperation with AscendMoney, the payment company of Thailand Zhengda international group.

Alipay is just the beginning. In the future, Ali will import other products and services of Alibaba into the Southeast Asian market through this entry.

Compared with Amazon, Ali has the advantage in developing markets.

The electricity market is growing, and payment and financial services are ripe for some time. But with the successful experience of China in the same developing country, Alibaba is obviously more confident and superior than the Amazon from the United States to cope with the complex situation in the Southeast Asian market.

As a matter of fact, Alibaba has begun to plan its layout, and has also made the first step in the Southeast Asian market.

Lazada, the largest supplier of electricity, has been working with AscendMoney for strategic cooperation. Even Amazon has been sending Redmart, hoping to be a springboard to Southeast Asia, because Amazon has bid too low to be steals by Ali.

According to TechCrunch, Amazon has only recently begun to purchase large quantities of refrigerated lorries and recruit personnel in Singapore, possibly from fresh groceries and ready to set up the Singapore office in the first quarter of 2017 as a base for entering the Southeast Asian market.

In business, Ali's platform model is more lightweight; Amazon has its own storage network and sells goods directly to consumers.

The Alibaba's Tmall and Taobao belong to online trading platform, so it is easier to expand without having to manage their own stocks.

After the expansion of the e-commerce platform, Ali can access its own payment system and financial services, and build its own logistics network, so as to build a closed loop ecosystem in Southeast Asia.

Overseas observers believe that for profit, Amazon profit is still recent, and the profit model is relatively simple, only stores, Prime and cloud services (AWS) three; and Ali because of the diversification of operations, its income sources are more diverse, including advertising revenue, Trading Commission and other investments.

That is to say, the risks faced by Alibaba are much smaller than those in the Southeast Asian market.

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