Additionally, Alibaba operates 1688.com for the wholesale business in China, where wholesalers and manufacturers conduct direct transactions online. Out of China, platform like AliExpress and Alibaba.com are operated by Alibaba Group for online retail and wholesale business respectively, serving consumers and sellers worldwide. What’s more, Alibaba Cloud, Alibaba Group's Cloud computing service provider, develops a platform for Cloud computing and big data management. It provides a wide range of Cloud computing services to support the users of Alibaba Group's online and mobile commerce ecosystem, as well as other third-party customers and businesses. 3. Business Model Amazon and Alibaba have grown to be the most notable players in e-commerce industry, but they have distinct features in terms of business model. Amazon is a titanic retailer for both new and used products, and Alibaba functions as a middleman between buyers and sellers through its online marketplaces platform. 3.1 Amazon When it comes to the case of Amazon, there are three aspects relating to its business model. First of all, Amazon sells products directly. The general retail covers dozens of product categories, ranging from health and personal care to consumer electronics, which means Amazon also operates its own warehouse to store necessary inventories. In addition to direct sales, the third-party retailers sell goods on platform of Amazon, allowing customers to shop from third parties who use Amazon’s platform and services. Products sold by third-party retailers are often less common items or those with a higher price, which could relief the competition between Amazon and its partners to some extent. As a comprehensive e-commerce platform, Amazon also provides fulfillment service to third-party sellers, including warehouse and
delivery service. As matter of that, items available on Amazon websites could be classified to different types, sold by Amazon, fulfilled by Amazon and fulfilled by sellers. Online consumers tend to pick up the item sold by Amazon for the sake of low price, quality guarantee and better customer service. Moreover, Amazon launched the Subscribe & Save service that enables consumers to receive a discount deal of Amazon and Amazon marketplace, free standard shipping, and enjoy the convenience of automatic delivery. The subscription service is able to increase turnover and to build customers’ loyalty. But retailing is only one part of the lines of business when it comes to Amazon.com. Online retail, including direct sales and third-party sellers, is accounting for the biggest share of Amazon’s revenue worldwide. Internet services provided by Amazon, known as AWS, is deeply integrated in Amazon’s e-commerce business. Additionally, Amazon has expanded its business into manufacturing and selling hardware products, such as the family of Kindle tablets. The expanding Kindle ecosystem, both the devices and the media contents, brings a substantial revenue to Amazon.
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