Online Buyology
Taobao and Weibo
Thursday, March 22, 2012
Bringing business to the masses
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Descriptions of China’s economy are often paired with the best of accolades: promising, miraculous and meteoric, to name a few. But observers rarely use the words “fair” and “transparent” to describe the country’s business environment. One need not look far to see why: rampant corruption, preferential policies for state-owned companies, and copious red tape all prevent private enterprises from thriving.
Yet out of this unequal playing field, e-commerce giant Alibaba and web portal Sina have created two of the fairest and most transparent business platforms in China. Alibaba allows individuals and companies to sell goods on its Taobao platform, giving vendors a set of standards and leaving everything else to their discretion. Weibo is similarly a free-for-all of Chinese expression, with the notable exception of controversial political topics.
Both Taobao and Weibo have exploded since their founding and have maintained commanding leads in their respective fields. Taobao sales were US$58.7 billion (RMB370 billion) in 2010 while Tmall, a site aimed at more developed brands spun off of Taobao in 2008, currently has about 55,000 vendors. And in the two years since Sina Weibo’s founding, the Twitter-like service has racked up 250 million users.
“If you ask people, ‘Why you want to shop online?’ I think many people will say that it gives transparency of pricing… people look for convenience, people like more information,” said Phil Wei, China CEO of Export Now, a startup that allows US-based companies to list products on Tmall. “One thing [Alibaba founder] Jack Ma did is offer freedom to all these consumers and all these business units.”
The free market
The freedom to compete is giving rise to third-party service providers that could become some of the most dynamic companies in the Chinese economy. As has been the case with US tech giants Twitter and Ebay, Taobao and Weibo have both
Thursday, March 22, 2012
Bringing business to the masses
Share:
Descriptions of China’s economy are often paired with the best of accolades: promising, miraculous and meteoric, to name a few. But observers rarely use the words “fair” and “transparent” to describe the country’s business environment. One need not look far to see why: rampant corruption, preferential policies for state-owned companies, and copious red tape all prevent private enterprises from thriving.
Yet out of this unequal playing field, e-commerce giant Alibaba and web portal Sina have created two of the fairest and most transparent business platforms in China. Alibaba allows individuals and companies to sell goods on its Taobao platform, giving vendors a set of standards and leaving everything else to their discretion. Weibo is similarly a free-for-all of Chinese expression, with the notable exception of controversial political topics.
Both Taobao and Weibo have exploded since their founding and have maintained commanding leads in their respective fields. Taobao sales were US$58.7 billion (RMB370 billion) in 2010 while Tmall, a site aimed at more developed brands spun off of Taobao in 2008, currently has about 55,000 vendors. And in the two years since Sina Weibo’s founding, the Twitter-like service has racked up 250 million users.
“If you ask people, ‘Why you want to shop online?’ I think many people will say that it gives transparency of pricing… people look for convenience, people like more information,” said Phil Wei, China CEO of Export Now, a startup that allows US-based companies to list products on Tmall. “One thing [Alibaba founder] Jack Ma did is offer freedom to all these consumers and all these business units.”
The free market
The freedom to compete is giving rise to third-party service providers that could become some of the most dynamic companies in the Chinese economy. As has been the case with US tech giants Twitter and Ebay, Taobao and Weibo have both