As Chinese eCommerce expands dramatically within the country, the one thing that has yet to emerge is a strong Chinese company with the power of Google, Facebook or even Amazon. Alibaba has had international expansion in its sights for years, but so far has yet to make a significant dent outside of China. That may be about to change.
Releasing Alibaba from the Bottle
For Alibaba and other Chinese-based eCommerce companies, the biggest sales day of the year has been November 11, otherwise known as “Singles Day.”
As sales growth from this event has steadily declined, Chinese companies are looking to escape their own borders in order to remain viable. Even though Alibaba saw a 54 percent year over year boost in revenue during its third quarter (when Singles Day falls), only seven percent of that income came from outside of China.
Diversification is going to be key to keep Alibaba and other Chinese Internet-based companies afloat, so Alibaba has launched an Amazon Web Services-modeled version of a cloud operating center. With data centers around the world, Alibaba hopes to entice an international audience in much the same way that Amazon already has. The widespread data centers mean there’s always going to be a fast, high quality connection for every user and corporation on the system.
In the Cloud
So far, the cloud unit is doing gangbusters, having more than doubled in value in just three quarters to $254 million. Other areas that the company is focusing on include mobile and online advertisements, which it hopes will make up for a slow in customer growth. After all, fewer customers who are buying more is still a pretty good proposition for earnings.
For Alibaba to be truly successful, however, the entire engine is going to have to break out of Chinese internet space and gain fans abroad. Because of how China has approached eCommerce and other aspects of the Internet, it has been difficult for companies like Alibaba to compete elsewhere since they’re often behind on the most recent web fashions and functions. Ultimately, for a strong Chinese company to emerge on the global scene, the Chinese government may need to loosen Internet regulations to help eCommerce flourish.