Alibaba Group is making significant changes to its business structure, combining all of its e-commerce platforms into a single unit called Alibaba Ecommerce Business Group. This new group brings together both the domestic Chinese e-commerce platforms, Taobao and Tmall Group, and the international e-commerce platforms, which include AliExpress, Alibaba.com, and Xianyu.
● This is the first time the company is integrating its domestic and international e-commerce platforms.
● Alibaba CEO Eddie Wu stated that the e-commerce industry, both in China and globally, is entering a new era where global supply chain capabilities, fulfillment capabilities, and consumer service capabilities will be crucial for future competitiveness.
Leadership and Reasoning
Jiang Fan, the current CEO of Alibaba International Digital Commerce Group, will lead the new Alibaba E-commerce Business Group and report to Alibaba Group CEO Eddie Wu. This restructuring comes 20 months after Alibaba divided itself into six separate units, the largest change in its 25-year history.
● Alibaba is facing increased competition from rivals like Pinduoduo, Temu, Douyin, and TikTok.
● The company believes that integrating its e-commerce platforms will enhance its global supply chain, fulfillment, and consumer service capabilities, thus strengthening its competitive position in the evolving e-commerce landscape.
Alibaba’s Focus on AI
Alibaba’s recent quarterly earnings reveal that its artificial intelligence (AI) offerings are driving growth in both its retail and cloud businesses.
● Merchants on Taobao and Tmall are increasingly adopting Alibaba’s AI-powered marketing tool, Quanzhantui, leading to expectations of increased marketing spending on the platform.
● Alibaba’s Cloud Intelligence Group also experienced accelerated year-over-year revenue growth during the quarter, with double-digit growth in its public cloud products, partly driven by rising adoption of AI-related products.
● The company has also launched an AI-powered search engine for global B2B sourcing, allowing businesses to find wholesale products using text or image prompts. This new product simplifies international procurement for small to medium-sized businesses and increases platform transaction efficiency.
Alibaba’s recent recruitment efforts, particularly targeting talent from Silicon Valley companies, further demonstrate its commitment to advancing its AI capabilities. /// nCa, 22 November 2024 [AI-assisted]