After Dai Shan took over the "Big Tao Department", she made a public appearance, and the CFO announced seven major investment themes

Reporter | Cheng Lu

From December 16 to 17, Alibaba's 2021 Investor Day event was held online, which is the sixth consecutive year that Alibaba has held an investor exchange event since 2016.

Just ten days before this year's Investor Day, Ali completed the latest round of organizational structure upgrade adjustment, so the highlight of this year's Investor Day is also around the new organizational structure, re-output Ali's thinking on various business sectors, the clarity of the group's strategic direction, and Ali's future investment theme.

Taote and Taocai focus on the sinking market

In the organizational structure adjustment on December 6 this year, Ali's power center was once again centralized, the Taobao and B departments were fully integrated in the history of the organization, and the domestic e-commerce business was further consolidated, including the big Taobao (including Taobao, Tmall, Alimama), B2C retail business group, Taocaicai, Taote and 1688, which were jointly named "China Digital Business Plate", led by Dai Shan. She is one of Ali's "Eighteen Arhats" and the only founder of Ali who is currently leading soldiers to fight in the front line of the business.

On the Investor Day, Dai Shan, who replaced Jiang Fan in charge of the "Big Tao System", made her first public appearance, representing Alibaba's first special introduction to the new strategy and stage results of the sinking market. Ali hopes that through the improvement of B-end supply, a large number of C-end demand that could not be met in the past will be released, and then it will drive the evolution of related industries.

Dai Shan focused on the two new businesses of Taote and Taocaicai, which provide goods and services for the sinking market through the M2C (Producer Direct To Consumer) model. As of the end of September this year, the annual active consumers after the deduplication of Taote and Taocai vegetables reached 270 million, an increase of 200% year-on-year; the average daily transaction order volume after the deduplication increased by more than 400% year-on-year.

What is the relationship between the two new businesses with the surname "Tao" and Taobao? Dai Shan answered the above questions, focusing on the differentiated way of playing: Taocai cuisine continuously improves user stickiness by meeting the high-frequency needs of families for three meals a day, and users who have used Taobao, Taote, and Taocaicai at the same time have an average annual purchase of 1.8 times that of users who only use Taobao. Taote and Taocai also provide goods and services for the sinking market, meeting the consumption upgrade needs of a large number of new users. Compared with the Hand Tao APP, the proportion of Amoy's exclusive member DAU is close to 50%; more than 50% of Taocaicai users buy fresh food on the Taoji platform for the first time.

"The strategic starting point we develop is what kind of value we can bring to our customers on an ongoing basis." Dai Shan said. From the perspective of consumption, Ali has more than 900 million consumers in China, with different consumption preferences, with two new businesses of Taote and Taocaicai, the "China Digital Business Plate" has completed the complete puzzle of serving different consumer groups, and is more in line with the trend of personalized, diversified and quality consumption.

In Dai Shan's view, the sinking market has great potential, but its outbreak is by no means a day's work. "Only through the innovation and creation of technology and models, the resonance and win-win of commercial value and social value, can we open up a greater imagination space for the future of the sinking market," Dai Shan said, next, Taote and Taocai will focus on two directions: one is to develop science and technology, to create more and more intelligent "Taocai factories" and scientific and technological demonstration "Taocai farms"; the second is rural infrastructure, increase the construction of agricultural product production warehouses, and jointly rookie land "Thousand Counties Co-distribution Center" project.

The "multi-terminal strategy" penetrates the Chinese consumer market

Previously, in the latest organizational restructuring, Alibaba announced the upgrading of the diversified governance system, and further split the commercial segment into four parts: "China Digital Commerce", "Cross-border and Global Commerce", "Local Life Services" and "Cainiao", further enhancing the company's transparency and reflecting the latest business progress.

Alibaba reclassified its business segments in its financial reports

On the Investor Day, Ali also introduced the newly unified "China Digital Business" sector for the first time. Alibaba said that the "multi-terminal strategy" has promoted the continuous expansion of the scale of platform consumers and is also the key to the future growth of China's retail market business. Alibaba's business strategy is gradually shifting from relying on the super APP of Taobao in the past to an application matrix composed of Taobao App, Idle Fish, Taote and other products.

"Although the consumer business is under great competitive pressure, we have built an extensive matrix to meet the diverse needs of our users." Daniel Zhang, chairman of the board and chief executive officer of Alibaba Group, said that Alibaba's annual consumer scale has reached 953 million, and it is impossible to meet all needs through a single product and a single service, which is an important prerequisite for Alibaba to build a consumer business matrix. At present, Ali can reach from the whole country to the local, from the far field to the near field, from multi-day delivery, next-day to same-day delivery, hourly delivery, and instant delivery, to achieve the consumer demand of different users in different scenarios.

Alibaba also disclosed the latest data of matrix products: there are currently about 6 million non-Taobao professional sellers in Idle Fish; as of September 30, Taobao's annual active users have exceeded 240 million; young consumers will become the new user increment of Taobao Tmall, and the penetration rate of Taobao among consumers aged 24 and under has reached 90%.

The local life plate forms two major matrices of old home and destination. In the 12 months ended September 30, Ele.me as a homebound app saw annual active consumer growth of 28 percent and order volume growth of more than 35 percent. As the entrance to the destination, the daily active users of the AutoNavi Map APP doubled year-on-year, and the average daily order increased by more than 190% year-on-year.

Alibaba's future 7 key investment themes

On the Investor Day, Ali also sorted out and announced the latest investment strategy.

In the face of a diversified business portfolio, Alibaba maintains a disciplined approach to investment. Xu Hong, deputy chief financial officer of Alibaba Group, introduced that in the consumer business, Alibaba follows the "three stages of growth" framework, that is, in the "sowing stage", "growth stage" and "profit stage", respectively, it adopts different strategies such as prioritizing investment in user minds, increasing market share, and achieving monetization and profitability.

Alibaba said that the "three-stage growth" investment strategy has helped Alibaba's domestic consumer market business achieve sustainable growth, Taobao Tmall maintained its market leading position, and new businesses such as Taote and Taocaicai achieved strong user and order growth. In the overseas market investment, Ali also disclosed the stage results of the relevant harvest. In the 12 months ended September 30, Lazada, AliExpress, Trendyol, and Daraz had a payment GMV of $44.1 billion, with payment orders up more than 60% year-on-year, and are expected to become one of Alibaba's key growth drivers in the future.

At the group level, Daniel Zhang also emphasized that Ali will adhere to the three major strategies of domestic demand, globalization and high technology in the future. At present, the Chinese business sector is led by Dai Shan, and the global sector is managed by Jiang Fan. Ali believes that the continuous investment in technological innovation, supply chain and logistics capabilities is the basis for the growth of related businesses, and also makes Ali's revenue structure more and more diversified. In the 12 months ended September 30, both the cross-border and global commercial business and Alibaba Cloud business maintained growth, excluding The Consolidation factor of Gaoxin Retail, these operating segments contributed 17% of the Group's revenue.

Wu Wei, chief financial officer of Alibaba Group, said that some of Alibaba Group's businesses may also receive their own external financing opportunities, including "China Business", "Cross-border and Global Business", "Local Life Services" and "Cainiao" businesses.

In addition, Xu Honghai shared seven key investment themes under the two major investment directions of Alibaba in the future. In terms of existing businesses, it will focus on four aspects: mass consumption, corporate services, high-tech and globalization, and focus on three major themes: green economy, silver economy and rural revitalization in terms of future opportunities.