The E Commerce Companys Strategy - 1724 Words

The e-commerce company’s strategy focus allowed it to differentiate itself by providing better services to its customers. The company put an innovative business model in which customers would try out the company’s services without any cost. As time progressed, the company was able to generate revenue from alternative means. In addition, the company began to generate revenue from an increase in the willingness of its users to pay for additional services. First mover advantage is referred to as a competitive advantage because it allows the first company to acquire superior brand recognition and customer loyalty, while allowing the company to perfect its product or service. Alibaba’s operations stated when e-commerce was at infancy stage in†¦show more content†¦Credit cards may have been used in China, but they had yet to be trusted by the community, the Chinese were not comfortable with them and preferred different mediums of transaction. Thus, Alibaba est ablished the payment system to provide the Chinese with a sense of safety, contributing to the Chinese willingness to participate in online transactions. Regulations can pose a challenge for businesses operating in emerging markets like China. For example, the internet was highly regulated and was a reason why some foreign companies struggled to succeed in China. Alibaba navigate the posed challenges well and took advantage of the opportunities while at the same time mitigating the risks of operating. The popularity of Alibaba and the growth of e-commerce in China attracted foreign e-commerce companies. In 2002, eBay entered the Chinese e-commerce market through an acquisition of 33% of EachNet, creating eBay EachNet. That same year eBay EachNet merged as the leader in online auctions, leading to the capture of 79% of the online auction market by 2003. In consideration of the growth in the online auction market, Alibaba launched Taobao.com as a rival to eBay EachNet. Taobao.com was launched to capture the opportunities in C2C e-commerce market in China. Having already established a dominance in B2B e-commerce, Alibaba was hoping its local knowledge would help it dominate the C2C e-commerce market, toppling the newcomer eBay