1. Intro to Marketing Mr. Bernstein September 29, 2014

2. Intro to Marketing Mr. Bernstein What is Alibaba? Amazon, Ebay and Paypal rolled into one 90%+ market share in China, growing in Emerging Markets Offers global reach Customizing to local markets IPO raised money to fund expansion into US, Europe 2

3. Intro to Marketing Mr. Bernstein Alibaba vs. Amazon, Ebay 2014 estimated sales: Alibaba $420b; Amazon $85b, Ebay $20b “Singles Day” 2013 sales: $5.6b; entire US 2012 Cyber Monday sales $1.7b Unlike Amazon, Alibaba is currently profitable 3

4. Intro to Marketing Mr. Bernstein Alibaba Lines of Business Taobao (Ebay-like) Largely B2B; initial and still primary business Over 1 BILLION products offered Free service; revenues come from selling ads, data, membership fees, web design, cloud computing, SEO and other services Success based on dominant market share, liquidity Blocks spiders so you must go to site to browse its contents Problems with fakes, nondeliveries, payments systems other than Alipay 4

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6. Intro to Marketing Mr. Bernstein Alibaba Lines of Business Alipay (Paypal-plus) Easy-to-use payment system…in China… Loans and Insurance to small businesses Tmall (B2C) Similar to Amazon, charges companies a commission on sales Better policed so large companies gravitate toward this site 6

7. Intro to Marketing Mr. Bernstein Who is Alibaba’s Target Market(s)? 7

8. Intro to Marketing Mr. Bernstein Who is Alibaba’s Target Market(s)? Small businesses around the world Lack resources to gather info like corporations In China, 90% of e-purchases are from a marketplace matching buyers and sellers…but… In America, 76% of e-purchases are from a merchant website 8

9. Intro to Marketing Mr. Bernstein 4 P’s for Alibaba Define and advise Alibaba on Products Pricing Promotions Place (distribution) 9

10. Intro to Marketing Mr. Bernstein 4 P’s for Alibaba Products Access to widest range of products for sale or desired to purchase Ease of Use Trustworthy Alipay Localized by country/culture (Ma is English teacher) Overcome fears of counterfeit goods Screening/editing of postings, messages Pricing Many services free Promotions Data based Place Mobile 10

11. Intro to Marketing Mr. Bernstein Marketing Information in Alibaba What info can be gathered? Demographic Business results Unstructured (posts, messages) - similar to social media How could it be used? Segment market Identify mktg strategies with best impact for each segment I.e. tailor promotions for various products, change pricing, Requires investment in database management system 11