Alibaba can win in the o2o business by creating a

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Alibaba can win in the O2O business by creating a complete symbiotic, sustainable O2O ecosystem, integrating different technology elements to make its O2O business more efficient, convenient and reasonably priced therefore creating added value for both merchants and customers. This can be facilitated with business partnerships, acquisitions, strategic investing and leveraging its financial power to get government regulations that favor their O2O and long term strategic plans. Alibaba’s acquisition strategy of securing component parts of the O2O value chain enables them to make its O2O ecosystem sustainable, symbiotic and secure. Once Alibaba controls and integrates all the elements that gives its O2O ecosystem value i.e.; logistics, supply chain, payments, marketing and data analytics, it will be well positioned to offer both merchants and customers convenience, trust, ease of use and reasonable prices, so it can then scale quickly to position itself and stay as the leader in the O2O market and retail as a whole in China. Alibaba should consider M&A candidates that add strategic value to its long-term plan of controlling the O2O sector and retail commerce on a whole (online and offline) in China. These M&A candidates should be in the areas of logistics, supply chain, inventory management, customer relationship management, as well as data analytics and payments. Alibaba should also look at offline verticals in consumer electronics, food and entertainment. Some of these potential
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M&A candidates include youku, Tudou, Suining, ele.me, lazada, paytm, shbj.com, cainiao, gooday BB, UCWeb and YunOS. I would go further to entertain the option of doing business with or acquiring major competitors like Tencent, Baidu, Wanda and JD.com. Alibaba should use cultural/buyer characteristics unique to China as a competitive edge to grow its O2O business in China and if Alibaba eventually decides to scale O2O globally, there is one caveat it must take into consideration and negate; because of poor quality perceptions of Chinese companies Alibaba is better off entering new global markets through partnerships or acquisitions and not to initially be the public facing brand, but to use country specific brands to front their market entry. However, if you succeed in becoming a high-quality service and product offering Chinese company, this may auger well for your global expansion ambitions. Alibaba can use the following keys to success to improve its chances of becoming and maintaining its position of dominant player in China’s retail sector. 1. Large market size and customer base in China, over 1billion. 2. Large amounts of customer data that they use to target customers and drive conversions. 3. Innovative Leadership with clear long term strategic plan.
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  • Fall '12
  • Buss
  • Revenue, Alibaba Group

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