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- Source/Night Deep Finance
- Author/Night Deep Finance
01. The top 50 global retailers were announced, and Alibaba regressed by two places!
The 2024 Global Retail 50 is out!
Walmart is firmly in first place, followed by Amazon and Schwarz Group.
Chinese companies Alibaba and Watsons are on the list!
It is worth noting that Alibaba, which is still ranked 14th in 2023, has dropped two places this year to 16th.
International revenue also fell to $2.58 billion from $2.6 billion.
2023 American Retail Federation list
2024 American Retail Federation list
Source: American Retail Federation
According to Alibaba's latest financial report, as of December 2023, Alibaba's operating profit, net profit and cash flow have shrunk to varying degrees. Jack Ma also posted a long article reflecting on Ali's reform for the first time in five years.
Source: Alibaba Group's official website
This change quickly attracted attention and discussion from the outside world. What happened to e-commerce giant Alibaba?
02. Domestic business reform and reorganization, Alibaba's overseas expansion was frustrated
Perhaps this change may cause skepticism among investors, but Alibaba is actually reforming its domestic business.
In particular, after the strategic adjustment of its two important business units, Alibaba Cloud and Cainiao, the new management team and the re-establishment of the enterprise value perception have injected new impetus into the development of Alibaba.
As one of Alibaba's core businesses, Cainiao is also one of the world's largest cross-border e-commerce logistics companies. It is reported that in Alibaba's latest quarterly financial report on February 7, Cainiao's quarterly revenue increased by 24% year-on-year, maintaining a strong growth momentum.
The logistics industry operated by the rookie team is an important foundation for the development of e-commerce layout, and it is also the most fierce battlefield for the giants to compete in the business battlefield. Although Cainiao has been withdrawn from the listing by Alibaba, Alibaba Group said that in order to better strengthen the synergy with Alibaba's e-commerce business, and continue to support Cainiao to expand its investment in global logistics network.
At the same time, Alibaba also issued a takeover offer to rookie employees, which on the one hand gives back to the long-term contributions of employees and helps to further boost the confidence of the rookie team, and on the other hand, Alibaba's buyback will help increase strategic investment in the logistics field and support the expansion of Cainiao's global logistics network. It can be seen that Ali is full of confidence and determination in rookies, and is expected to build "the world's first smart logistics stock".
Recently, Alibaba Chairman Tsai Chongxin also confidently said in an interview that after restructuring and new management in place, Alibaba has returned to the track of China's top e-commerce companies.
However, the overseas expansion of Alibaba's business empire has encountered unprecedented challenges.
Compared with the gradual saturation of the domestic retail market, many e-commerce giants have chosen to deploy their business territory overseas. Like Pinduoduo developing the Temu cross-border e-commerce platform, JD Logistics is also putting heavy pressure on the European market. As one of the earliest Chinese cross-border e-commerce platforms to go overseas, Ali founded "AliExpress", which is known as the "international version of Taobao" by the majority of sellers, as early as 2010, and also acquired a number of e-commerce platforms such as Lazada, the largest e-commerce company in Southeast Asia, in the following time, and is committed to building a global retail chain.
The pressure of overseas competition has become greater, and the days of going to sea are not easy?
Let's first look at Southeast Asia, the "first choice" of e-commerce going overseas.
In recent years, the development of e-commerce in Southeast Asia is obvious to all, with huge market potential and friendly foreign trade policies. But with the entry of various forces, the highlight moment of Lazada, which is Ali's operation in Southeast Asia, does not seem to last long. In the Vietnamese market, TikTok Shop has officially surpassed Lazada in the first half of 2023. At the same time, the Indonesian market Lazada was also quickly overtaken by TikTok Shop.
In order to cut costs and optimize the structure, Lazada, the former flagship e-commerce company in Southeast Asia, laid off about 500 employees, including the president and some senior executives, which is quite Alibaba's style.
欧美老牌电商难搞，蒋凡也皱眉。
If the Southeast Asian e-commerce market is a mature supply chain, it is the cost of distribution, which is guided by the pursuit of low prices. Then the European and American markets are brand power and focus on high quality. Compared with the densely populated Asian market, the distribution cost in Europe and the United States is obviously higher, and there is an absolute hegemon in the North American market like Amazon that occupies the market share for a long time. In Europe, most of people's shopping habits still rely on offline shopping, and physical stores in Europe are also competing with e-commerce for customers.
This has made Ali International face the pressure of fierce market competition, and it is necessary for Ali International to better land in the local market through continuous reform of itself.
In order to break into the European and American markets, Ali International has also launched a B2C independent station AllyLikes to benchmark Shein, a clothing platform that also focuses on high-quality and inexpensive clothing. However, Shein, which has been cultivating the international market since 2008, has occupied most of the overseas market, and due to the unfamiliarity with the market and the lack of supply chain optimization, the latecomer AllyLikes has been complained by users about poor product quality and slow logistics and distribution. So only after hitting a traffic peak of 230,000 in September 2021, it began to go down, and finally the official website of AllyLikes, which has been online for only two years, is now inaccessible.
03, Ma Yun reflected on stabilizing the army's heart, and Ali is about to counterattack
The day before yesterday, Ma Yun posted a long article reflecting on Ali's internal problems, and pointed out that what Ali needs is not to catch up with KPIs, but to recognize itself and return to the track of customer value.
Tsai Chongxin also admits that "Ali is lagging behind because we have forgotten who our real customers are." Our customers are users who use our app to shop, and we don't give them the best experience. In a way, we're kind of self-defeating. ”
Ma Yun and Tsai Chongxin both pointed out the core cause of Alibaba's regression, which is the cognitive problem of "customer value". It is necessary to move from the previous merchant first to focus on user experience. Pinduoduo is because of the "cut a knife" and make users have the psychology of "taking advantage", coupled with "refund only", free shipping subsidies and other measures for the user's shopping experience, thus defeating Taobao for Pinduoduo's withdrawal, in November last year, the market value of Pinduoduo surpassed Ali for the first time.
After cutting the meat, then counterattack!
Some experts pointed out that Alibaba is an innovation-driven company, and if large companies have too many problems and the decision-making chain is disjointed, it will actually have a negative impact on innovation ability.
Indeed, the ship was in great difficulty and turned around. Therefore, since last year, Ali has officially opened the "1+6+N" organizational spin-off, so that qualified business groups and companies have the possibility of independent financing and listing in the future. The originally huge Alibaba Group is now an independent group of various businesses, fighting their own battles to stimulate innovation vitality.
At present, Yu Yongfu, Hou Yi and other "old faces" have stepped down one after another, and the addition of the younger team and the return of Tsai Chongxin and Wu Yongming can make Ali succeed in saving himself and catch up with the AI clipper.
As Jack Ma said in the letter: "In the face of this era of great technological change, the time span of three or five years is like a century for the Internet field, which is enough to undergo earth-shaking changes...... The era of AI has just arrived, and it's just the beginning, so it's time for us!"
It is expected that Ali will be reborn in the midst of breaking and standing, insisting on reforming its old business, and returning to the track of customer value.
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