Business Strategy Evaluation & Recommendations EVALUATE BUSINESS STRATEGY Internal Assessments Evaluation : Bridge of Business-To-Customer Information Technology Information Flow, Capital Flow and Logistics Development Mechanisms Development Significance of Alipay( 支付宝 ) External Assessments Evaluation : Huge Market Potential of Online Shopping Social Environment Trading Platform Environment

Business Strategy Evaluation & Recommendations EVALUATE BUSINESS STRATEGY Internal Assessments Evaluation : Bridge of Business-To-Customer Provide: sets business portals, search engines, shopping platform payment whole range of hassle-free services Result: Ensures transaction security Safeguards legitimate rights and interests for both parties.

Business Strategy Evaluation & Recommendations EVALUATE BUSINESS STRATEGY Internal Assessments Evaluation : Information Technology >Interaction design of information system Interface of Yahoo More suitable JavaScript UI effects and tools Chinese Web Application Result: Advocates the lively and efficient network transactions culture Creating a more secure and efficient trading

Strong local culture that reflected a deep understanding of Chinese consumers and an attitude of informality. Chinese customers want their sites to be noisy, with lots of links

Business Strategy Evaluation & Recommendations EVALUATE BUSINESS STRATEGY Internal Assessments Evaluation : Information Flow, Capital Flow and Logistics Development Information Flow: Integrates B2C and C2C e-commerce Provide effective real-time information services Capital Flow : Uses the tool of “Alipay” ( 支付宝 ) Logistics Development: Cooperation & recommending third-party logistics companies Provides logistics information services for customers Result: Provide effective real-time information services Resolve the issue of network payment Development digital certificates Ensures the capital security, Information security, Cargo security, Trade secrets in online transactions

Business Strategy Evaluation & Recommendations EVALUATE BUSINESS STRATEGY Internal Assessments Evaluation : Mechanisms Development Register need to using national identity card and bank account Allowed buyers and vendors provide feedback Distinguished between seller and buyer (eBay provided only one score for each user.) Introduced Alipay ( 支付宝, “payment treasure”), Result: Create Confident for both seller and buyer

Business Strategy Evaluation & Recommendations EVALUATE BUSINESS STRATEGY Internal Assessments Evaluation : Significance of Alipay( 支付宝 ) Critical to Taobao’s development Even buyers see a seller with high ratings, lack of trust still Creates a big challenge Banks cannot address the settlement risk. Free of charge by using Alipay Result: Eliminates the settlement risk. More than 80% of Taobao transactions rely on Alipay. On eBay, there were many buyers who complained that They did not receive their items.

Business Strategy Evaluation & Recommendations EVALUATE BUSINESS STRATEGY External Assessments Evaluation : Huge Market Potential of Online Shopping Online Shopping Environment: 17.9% Internet users in China have the online shopping experience 29.6% of them have their online shopping experience More than 90% of respondents will continue the shopping These data indicated that China's huge market potential of online shopping. Market Leader: More than 62 million registered members Number of registered members of Alipay is more than 63 million Occupied more than 70% of market share in China, More than 80% market share of C2C First choice for Chinese netizens starting a business online

Business Strategy Evaluation & Recommendations EVALUATE BUSINESS STRATEGY External Assessments Evaluation : Social Environment Taobao - under the social and national macro background of China's political stability and steady economic development. China‘s network infrastructure continuously improved, rising the number of netizens( 網民 ) Chinese Government actively supports e-commerce Provides good environment for the development of e-commerce. Enacted a Series of relevant policies, laws, regulations, etc. Promote and facilitate e-commerce applications and security system

Business Strategy Evaluation & Recommendations EVALUATE BUSINESS STRATEGY External Assessments Evaluation : Trading Platform Environment Under trading platform, Seller initiatively sales or auction for goods Buyer choose goods to bid and purchase Instant-messaging service, Wangwang Provide continuous feedback Ask for assistance Make suggestions Bargaining Bidding process can save a lot of market communication costs. As a result, communication problems” constituted only 8% of Taobao’s non-positive feedback.