Alibaba insights – China’s commerce giant

China’s giant tech company Alibaba is one of the biggest eCommerce players in the world. When comparing the biggest players in the online marketplace field, for example, Alibaba does not only dominate the Asian market, but is also the unbeaten leader in the GMV race of online marketplaces globally. With two platforms in the game outpacing each other, Alibaba outperforms its biggest international marketplace competitor Amazon by far in terms of total GMV. A closer look at Alibaba’s commerce business structure reveals that the company does not only count on its marketplace frontrunners Taobao and Tmall, but builds on a complex system of online and offline as well as domestic and international revenue streams:

Alibaba’s biggest commerce sections in terms of the number of different services offered are the national third-party and first-party businesses. Next to the world-famous platforms Taobao and Tmall, the domestic marketplace section also includes services like the manufacturer-to-consumer platform Taobao Deals or the community shopping service Taocaicai. Next to Tmall first-party spin-offs like Tmall Supermarket or Tmall Global the Alibaba first-party retail section also includes fully or partly offline services like AliHealth or Freshippo. B2B platform 1688.com is Alibaba’s domestic wholesale service.¹ Alibaba is not only big in the Chinese market, though. With AliExpress and Lazada, for example, Alibaba has two international players in the game which reach high ranks in the global comparison of biggest online marketplaces by GMV.

In its home market, Alibaba has an ever greater reach with its various services addressing different consumer needs. According to information published by the Group on its 2021 Investor Day, Alibaba is especially popular among China’s urban population. The bigger the city, the higher the penetration of Alibaba services as a percentage of total population, and the faster the growth in penetration. Tier 1 and 2 cities already registered a penetration of Alibaba’s Annual Active Consumers³ of 85% by Sep 30, 2020, and the penetration grew by 14 percentage points to a total of 99% in just one year, according to Alibaba. In smaller cities, Alibaba was also able to grow their Annual Active Consumer base between Sep 30, 2020 and Sep 30, 2021, but slower. Tier 4 and smaller cities reached an AAC penetration of 71% by the end of September 2021. On its latest Investor Day, the Group announced a total of 953 million Annual Active Consumers in 2021. Given these impressive penetration numbers in the domestic market, Alibaba might likely expand further into international markets in the near future.

1: The marketplace section on ecommerceDB.com only includes platforms with a B2C focus. Pure C2C platforms, B2B platforms, community shopping, and manufacturer-to-consumer services are out of scope. Furthermore, ecommerceDB follows a brand-level approach, which is why spin-offs are included in the main brand profile.

3: Online population based on QuestMobile monthly active user data for Chinese internet users in September 2021

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January 2022