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Not many people may have thought in advance that under the increasingly severe pressure situation, Ali can return GMV to the double-digit growth range so quickly.
Not only the GMV of Taotian Group, but also the order volume and 88VIP have achieved double-digit year-on-year growth, coupled with the international business that has been able to play, and the public cloud AI-related revenue that has driven Alibaba Cloud, it can almost be said that it is the most convincing shot in the arm since Ali's organizational reform.
The research report of the third-party brokerage also provides proof of Ali's recovery of vitality: earlier, Huachuang Securities disclosed that the GMV of Taobao + Tmall increased by 14% year-on-year in March this year, surpassing Pinduoduo's 13%, and even the MAU with Taobao also rose by 10%, returning to the first place in the industry.
Behind the wonderful turnaround is the decision to change and live after death.
In other words, "returning users" is essentially just a slogan, whether users feel the regression, ultimately depends on consumption voting, and it has been proved that Ali and the users of its services have not paid each other wrongly.
Looking ahead, this is the beginning of enough positive feedback, and more importantly, to what extent can Ali still look behind him and find its own foundation from the reasons for its success as an e-commerce pioneer.
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If you are an active user of Taobao or Tmall, you should be able to feel the product changes quite frequently in the past year, and intensive measures to tilt towards users have been continuously launched, such as the emergence of the use now, pay later and refund-only functions, such as the upgrade of 88VIP membership rights.
In the upcoming 618, Tmall even made a decision to "go against the ancestral teachings", canceling the pre-sale system, and the participation process of merchants is no longer from registration to selection, but as long as they meet the requirements, they can directly enter the big promotion list and get the platform subsidy.
All the actions are pointing to Ali's reshuffling of the e-commerce format, the strategy of "user first", which sounds like an attitude, but in fact, it is the test of supply capacity, service ability, whether the product can establish a new operation system, and Ali has planted a new flag on the mountain, and how many figures will gather over the ability. Judging from this quarter's financial report, Taobao's strong return seems to have an answer to this question.
It's hard to imagine whether Wu Yongming has made a timetable since he became the CEO of Alibaba Group in September last year, at that time, everyone knows the status quo that Ali needs to change, but in what direction to change and how quickly it will take effect, the whole company is in a state of anxiety and stress.
That's why Wu Yongming's evaluation of Ali's self-transformation this year is particularly incisive: "There is no doubt that the road to transformation will be difficult, but we are fully prepared."
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Harvard Business School professor Clayton Christensen has invented a concept called the "Innovator's Dilemma" to summarize the phenomenon of seemingly successful business giants suddenly falling into a downward cycle:
A company that has no problems with management suddenly encounters competition from disruptive technologies, and the better it is managed, the more it will naturally hinder it from facing the pain, and instead conclude that it is not well managed, and then continue to optimize its "system" until it is irretrievable.
In a way, this explains why Wu Yongming — a member of the startup team who has been fully involved in Taobao's growth from zero to 100 billion in revenue — was chosen to lead the team through the difficulties, and he is the one who knows the "bottom line" of the company, which 20 years ago was the one with the disruptive technology that upgraded traditional trade to e-commerce.
However, things are man-made, and as long as people's will and experience are still there, the identity of challenging and being challenged is not irreplaceable.
In the earnings call, Wu Yongming explained to analysts the reason why Alibaba is back on a healthy growth track in layman's terms: "The first is to have quality goods, then to supply them at good prices, and finally to support the transaction through excellent service."
As the saying goes, when Alibaba returns to this principle – and it's worth repeating that this is the answer to Taobao's sweeping of China's internet in the first place – it's dismantling the path dependencies of large companies, such as the greed for hands-off bosses, or the pursuit of higher profit margins.
With a volume of hundreds of billions of dollars, we will go back to do services, create free shipping logistics for Xinjiang sellers, divert and connect customers for brands and white labels, and so on, the first thing is to destroy the so-called "good management" and establish new standards for the industry.
As long as the goal is clear enough and suitable for focus, Ali can often burst out with the strongest combat effectiveness.
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Porter Erisman, an American who was a rare expatriate executive in Alibaba's founding years, later wrote a book about how Taobao beat eBay at the time: all about creating a thriving market that satisfies the consumer economy.
So when eBay charged transaction commissions, Taobao announced that it was free to open a store, eBay followed the trading culture of second-hand goods in the West, Taobao attached great importance to the commodity supply chain from the beginning, eBay prohibits buyers and sellers from contacting privately, Taobao specializes in developing chat tools, and even the idea of escrow funds by the platform in an environment with insufficient credit for online shopping is what eBay tried in South Korea but gave up, and Alipay finally persevered.
Porter Erisman said that at the height of the battle with eBay, Taobao's office was convinced that the other side would not dare to come up with the same policies as Taobao — such as free — because that would put pressure on Wall Street, "who wanted eBay to quickly reap the benefits of the $180 million it had invested in China."
As a veteran who has also experienced this battle, Wu Yongming also explained to investors in a conference call yesterday that CMR (customer management revenue) has not kept up with GMV growth, because investment in core competitiveness and improving consumer experience are the most important goals, "Only after successfully achieving this goal, can we really increase CMR." In fact, the increase in CMR is just a natural consequence of these efforts."
Obviously, Ali knows what kind of mistakes big companies can make, so it will not step into the same river, on the contrary, not only to adapt to the current competition, but also to start the future development, Ali realized that the vision of "making the world no difficult business" is actually far from reaching the point of real solution.
At the right time, the eve of the AI era has arrived.
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Also in the AI mania in the past year, looking at a number of Chinese Internet companies, Ali's performance is the brightest, and there is no one.
At the end of April, the Qwen1.5-110B, an open-source model with 110 billion parameters, has surpassed Meta's Llama-3-70B in multiple benchmarks and topped the HuggingFace open-source large model rankings.
The just-released version 2.5 of Tongyi Qianwen scored on the same level as GPT-4 Turbo on the authoritative benchmark OpenCompass, and the ability to generate dance videos from a single picture that was popular on the Internet at the beginning of the year was also scored by Tongyi Qianwen.
Not to mention the dark side of the moon and MiniMax and other AI startups in the limelight, their new rounds of financing are led by Alibaba, if there is a chance to give birth to China's OpenAI from it in the future, Ali's role is quite close to Microsoft's "picking up the big baby".
It's still unclear what will happen to e-commerce in the AI era, but Ali's investment in AI has been reflected in the sales of technical services, and Alibaba Cloud's Q4 profit increased by 45% year-on-year - even on the basis of product price reductions - relying on its leading position in AI infrastructure.
To a certain extent, AI has also provided a technical dividend for Ali to carry out changes, and in the new rules of the game, Ali can just stand on another runway without having to dwell too much on the debate about the past.
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It is said that the earliest Chinese cyclical theory was proposed by Ji Ran, a strategist from the Spring and Autumn Period, and one of his students was much more famous than him, namely Fan Li, who was later known as the "Shang Sheng".
According to Jupiter's influence on the earth, every 12 years will experience a cycle of harvest, poor harvest, famine, and drought.
When there is a drought, go to buy a boat, and when there is a big flood, go to buy a car, and this operation has the highest input-output ratio.
This is also the underlying logic of passing through the cycle, seeking change in advance, taking the initiative to adjust, and using the current reserves to invest in future assets.
Ali has already started to go through the cycle, and as for how long it will be, we are all looking forward to seeing how long it will be.
Of course, the stock market's belief in profit is merit and only looks at the short-term earning ability also explains the decline in stock prices, but at the end of the day, the long-term value of any company is determined by its business development, and Alibaba's goal is to invest in the competitiveness and long-term development of several core businesses, which is the only correct answer.