Expansion into new markets Rising Smartphone usage Trends in cloud computing

Expansion into new markets  Rising Smartphone usage  Trends in cloud computing  Rapid growth in the e-commerce market in China Threats  Environmental challenges 6

 Rising costs  Weakening of export growth in China  Weak global economy  Challenging environment for small and medium businesses  Government regulations  Competition  Lawsuits from other brands CURRENT STRATEGY Vision  To last 102 years  To be one of the world’s top 10 internet sites  To be an essential partner for all business people Mission Statement  “We operate leading online and mobile marketplaces in retail and wholesale trade, as well as cloud computing and other services. We provide technology and services to enable consumers, merchants, and other participants to conduct commerce in our ecosystem.” (Alibaba, 2016) Values Alibaba has the following values (adapted from Alibaba’s official website): Customer comes first Customers are the company’s life blood Teamwork and cooperation Team interests are always ahead of individual 7

interests Embrace changes Go beyond yourself and welcome changes Integrity Honest and upright, honoring commitments Passion Never give up and stay optimistic Honoring your job Perform the extraordinary with a professional attitude and an ordinary mind Culture The culture of Alibaba is about figuring out the right entry points for business questions. The official culture statement of Alibaba is as follows:  “Our success and rapid growth is built on the spirit of entrepreneurship, innovation, and an unwavering focus on meeting the needs of our customers.” (Alibaba, 2016)  “We believe that a strong sense of shared values enables us to maintain a common company culture and community, no matter how large we grow.” (Alibaba, 2016) Strategy The strategy of Alibaba is to connect suppliers and buyers globally to become the world’s largest online marketplace in terms of turnover in the next five years through an innovative, integrated, and reliable platform to create consumer trust (Alibaba, 2016). Currently, there are three levels of strategies for Alibaba: 1) business-level, 2) corporate-level, and 3) international- level. Business Level Strategy: Cost Leadership Alibaba Group gains substantial competitive advantage from building businesses to massive scale. These economies of scale enable the company to expand market opportunities, 8

giving Alibaba the ability to satisfy market needs from various sectors (Zhang, Guo, Zhang & Hu, 2015). The company also provides small and medium size enterprises, third-party companies, and retailers with a cost effective platform to market and sell their products (Zhang, Guo, Zhang & Hu, 2015). Corporate Level Strategy: Moderate to High Level of Diversification Alibaba attracts buyers and sellers through its diverse marketplaces. The three major marketplaces of Alibaba include Taobao, Tmall.com, and Juahuasuan.com. These marketplaces are set up to targets consumers with different needs. Additionally, the company has set up AliExpress on the international front to attract foreign buyers. The company also diversified its