Technology seems to be dominating every market in the world, and China is no exception. Yes, companies like Microsoft, Apple and Amazon have always been front runners, but stiff competition from the east has been raising some heads. Alibaba Group, a popular business-to-business (B2B) portal, has been seeing a substantial growth in Chinese sales over the years. This isn’t necessarily due to their B2B skills either. The Chinese economy has been wavering lately, but Alibaba has tapped into their e-commerce resources with great success. This increase in profits from online customers has catapulted Alibaba to the top. The potency of e-commerce in China is not unlike Amazon’s success in the U.S. Some believe it may be even better.
ALIBABA AND ITS ON CHINA
Let’s discuss numbers. Retail sales for Alibaba grew by 10% in 2015. Nothing to scoff at but despite this success, shares are still falling in China and the U.S. By tapping into their online consumer base, however, Alibaba was able to counteract the negative effects. From this point last year, online sales have nearly tripled for the company. The number of smartphone users was also seen to increase to a whopping 393 million. With this massive influx of customers, Alibaba now controls upwards of 35 percent of the mobile ad market. A move that has not only kept the company afloat, but is helping propel the Chinese economy in an otherwise shaky market.
AMAZON AND ITS CONTROL OF THE U.S
To compare just how successful the company’s impact is in China, let us examine one of the leading e-commerce companies in the U.S. By comparison, Amazon is much more international than its Chinese competitor. An impressive 40% of Amazon’s business comes from outside North America. That certainly gives them the global presence, but not necessarily a monetary advantage. Amazon’s profit revenues are significantly less. We’re talking billions here. Still, with 80% of Alibaba’s profits based in China, Amazon shouldn’t have much to fear right? Not necessarily.
The FUTURE IS IN THE CLOUDS
Amazon certainly has the warehouse locations locked down in the U.S, but Alibaba ha been making huge strides to buy up all the cloud space it can. With more cloud space, they can focus on conquering a more international market. Something that will surely concern any of their biggest competitors.
