Introduction
A business venture’s success relies on its founders’ model, innovation, and entrepreneurial skills. Various factors are integrated to make a business venture successful. A business venture is a planned activity that aims to provide the founders with profits. Alibaba is an example of a successful venture across the world. Jack Ma, the founder of the company’s business model, tactics, innovation, and entrepreneurial skills, made the business venture successful. Before launching a business venture, a business plan serves as a roadmap for the strategies and workflow. The study will discuss Alibaba Group as a business venture and the factors that led to its success.
A Successful Business Venture
Alibaba organization exemplifies a successful business venture owned by a Chinese group and that possesses websites for Internet sales. The primary objective of creating this group, the Chinese Jack Ma, was to transform e-commerce, making it faster, more efficient, and more profitable. Alibaba is responsible for 60% of the volume of deliveries in China and is the world’s third most important Chinese brand, behind Lenovo and Huawei (Wing et al., 2018). According to Wing et al (2018), Alibaba was the group’s first venture, and it is a wholesale marketplace responsible for surprisingly moving the Chinese economy. A customer can buy various items on Alibaba, such as clothes, household items, cars, motorcycles, accessories, and other products.
Alibaba is the world’s largest online B2B platform, responsible for generating employment for many retailers and brands worldwide. The Alibaba Group is valued at around $134 billion (Kwak et al., 2019). The number of active consumers on the platform is around 231 million (Kwak et al., 2019). In 2013, Alibaba recorded nearly $250 billion in transactions, more than the combined volumes traded by competitors eBay and Amazon (Kwak et al., 2019). On November 11th, China’s Singles Day is celebrated, such as the “Chinese black Friday” (Shao, 2019). Such a day can yield sales that are 20 times more than the average daily deals.
The main reason for Alibaba’s Success is its opportunistic nature. The company identifies new opportunities in the market and takes advantage of them. For example, they develop new models that diversify the consumer reach. Taobao, for example, was formed inside the company to focus on the Chinese market and retain its Chinese values. According to Anvari and Shirkhodaee (2020), Taobao only sells within China and with Chinese values. In addition, on this platform, smaller merchants and individuals advertise their products with the possibility of evaluating the goods and interacting with other users in the country. The mall strategy focusing on luxurious goods captures a wider market and thus innovates new ways to lure customers into purchasing. This company of the Alibaba group is mainly destined for the commercialization of luxury products. Demand for this segment has been growing in international trade, and this platform combines quality and supply.
Technological innovation makes business ventures more successful. They are facilitators of the economy. The Alibaba business venture focuses on a big data strategy that collects information about the consumer purchase process and diversifies its ability to continue growing its customer loyalty base. It is a cloud service responsible for offering digital tools that help manage applications, security, and big data, among others (Schmuck and Benke, 2020). Alimama is the tool responsible for digital marketing, the advertisements made on the platform, and the monetization arising from these processes; this is how Alibaba manages to control all its production processes.
AliExpress is a shopping facilitator responsible for connecting sellers and manufacturers, offering products at good prices and a huge variety. This business model makes the company successful in different countries they venture into. Taobao online store, Tmall B2C supermarket, Aliexpress online store for a foreign audience, a search engine, and Aliyun cloud service (Leavy, 2019). Alibaba has mastered the Alipay payment system and is developing businesses in the logistics, Internet TV, mobile messaging, social media, and entertainment industries.
Diversification of products and services made Alibaba a competitive giant. Despite the business diversity, the company receives more than 80% of its income from Internet commerce in the Chinese market, while retail and wholesale outside the country account for only 9.31% (Yang et al., 2019). The huge disproportion testifies to the potential and prospects of the international online trading platform. Statistically, Alibaba controls 80% of online commerce in the country (Kwak et al., 2019). However, dynamic domestic growth cannot be unlimited; entering the global market has become one of Alibaba’s next development directions. Competition spirit makes Alibaba group business venture very prominent and successful. The US has the world’s largest online marketplace, with over 70% of internet users shopping online (Wu and Gereffi, 2018). Alibaba entered the American market to diversify its market.
To break into the market, competing with local giants Amazon and eBay, Alibaba conducted a series of swaps. She bought shares in the luxury goods trading platform 1stdibs and the sports equipment website Fanatics and established a partnership with Shop-Runner, Amazon’s logistics rival (Yun et al., 2020). As part of the initial merger, Alibaba launched its first online marketplace in the US, 11Main.com, in June this year. It could become a real competitor to virtual giants like eBay and Amazon.
Entrepreneurship is the biggest reason for Alibaba Group’s business venture success. The company’s entrepreneurship is derived from its leader Jack Ma, who has a very interesting story that depicts success. One of the most successful entrepreneurs in the world, Jack Ma, the name at the head of the powerful Chinese group Alibaba, has a lot to teach those who want to walk the path of success (Kuo 2021). With a harrowing life story, the entrepreneur never gave up on his dreams and made his difficulties propel springs to go further. With an estimated fortune of over 45 billion dollars, Jack Ma is an inspiration (Naidu et al., 2019). Alibaba’s founder became one of the richest men in the world less than 20 years after the company was founded, and he now controls approximately 80% of all e-commerce in China. Generally, the desire to invest in various risks is the leading source of success for Alibaba.
The inception of Alibaba resulted from the B2B website and the connectedness it had yielded in China. Jack founded Alibaba in 1999 as a sales and B-to-B website that connected Chinese manufacturers with foreign buyers (Yun et al., 2020). In the following years, he launched AliExpress, wholesale and retail for individuals and international companies, and Taobao, which provides the same services but within the confines of China. In 2014, according to Anvari and Shirkhodaee (2020), the company held its IPO, which raised it to the current level of one of the largest companies in the world. Entrepreneurship is not only managing professional life but also managing personal life. If there is any similarity between Jack’s trajectory and that of other successful entrepreneurs, it is the perseverance with which these individuals pursue their goals.
Curiosity, seeking opportunity, and innovative minds make Jack Ma a successful entrepreneur who is helping Alibaba be more successful. What was interpreted as rebellion was curiosity and a desire to become successful in the future. A good example is how Ma learned English; when she was just ten years old, she became interested in the language, but her parents could not afford lessons for her (Wu and Gereffi, 2018). The solution was to go to the hotel reception to propose an exchange with tourists; he served as a tour guide while he practiced his English. As an adult, Jack Ma worked in various roles as a teacher, translator, and drug salesman without success (Pareek, 2021). In 1995, on a trip to the United States, he discovered the internet and understood that this was his way to be successful (Kwak et al., 2019). After the failure of his first online venture, China Pages, Jack Ma found the secret to succeeding, and he launched Alibaba, a Chinese Free Market. Thus, the tenacious ability to thrive in business makes it possible for the business to grow with the help of talented entrepreneurs.
Conclusion
The study presented the reason for the Alibaba Group’s business venture success. The major reasons were business model, innovation, opportunism, and an entrepreneurial owner.
References
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