Alibaba (Alibaba Group Holdings), which was founded in Hangzhou, China, in 1999 has a B2B e-commerce site (Alibaba.com) and two large B2C e-commerce sites (Taobao. com and Tmall.com). The company employs over 100,000 people across many countries. Their mission is “To Make It Easy to Do Business Anywhere,” and judging by the company’s success in only 20 years, it is achieving its mission. 

“Singles Day” in China is a response to traditional Valentine’s Day celebrations, which take place in August in that country. On Single’s Day, which falls on November 11th each year, many Chinese treat themselves to an online purchase. In just 90 seconds on November 11, 2018, Alibaba took in over $1 billion in sales, and its Web sites pulled in more than $31 billion in sales by the end of the day on November 11. To put Alibaba sales in perspective, consider that the U.S. Cyber Monday sales for 2018 were a little over $6 billion. Online Valentine’s Day sales in the United States were less than $20 billion in 2018. 

Critical Thinking Questions 

1. Alipay is the electronic cash system developed by Alibaba for Taobao.com and TMall.com, but it can generate revenues for Alibaba when Alipay is used for other purchases such as at restaurants, grocery stores, etc. Mastercard and Visa have recently passed the Chinese government’s regulations to be used in China, but those credit cards are mainly accepted at larger restaurants, hotels, and other travel industry establishments in larger areas. Small businesses and businesses in rural areas are unlikely to accept Mastercard and/or Visa. Would the increased use of Mastercard and/ or Visa at Taobao.com and TMall.com help or hurt Alibaba? Explain your answer.

2. Chinese citizens made over 130 million trips overseas in 2017, and the numbers increase each year. How does Alibaba leverage its Fliggy e-commerce site to get profits from using Fliggy instead of an e-commerce Web site in the country being visited by the Chinese tourist? 

3. Review the “Overcoming Global Issues” section of this chapter and then visit the TMall.com e-commerce Web site. How does TMall deal with the six challenges listed in that section?