Tag Archives: ecommerce

WeChat Value and Money-Maker

In 2011, WeChat (微信 in Chinese) started off as a messaging service, similar to WhatsApp but with more functions, and has grown rapidly into much more. We already explained that year 2014 will be the year of monetization for WeChat.

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At the moment, the application allows companies to send occasional, targeted messages to some users without charge. In the future, VALUE2020 predicts it might ask for a fee.

 

Payment & e-Commerce

The application integrates money-making services like online-payment functions into it. Customers can do their banking through it and a wealth-management service has just been launched. It is also promoting e-commerce: during a recent sale held exclusively on WeChat, Xiaomi, China’s hottest smartphone-maker, is said to have sold 150,000 of its latest model in under ten minutes.

WeChat payments are accepted in locations all over China. For example, you can find vending machine using WeChat. Instead of using cash to pay, the buyer opens WeChat and points its smartphone camera at a QR code. The app then reads the QR code, and charges the WeChat user for the price of the product. Then the product comes out.

 

 Conclusion

We can say this Chinese application is the most advanced messaging application in the world.

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Alibaba’s Push into Financial Services to Grow and Make Easier Global Business

The evolution of China’s e-commerce market is very fast. Some of the changes have the potential to be transformational.

Back in 2009, Alibaba, the Chinese e-commerce company, introduced a service which provides loans to merchants who sell through the company’s web platform. The fundamental problem inspiring its creation was that some online merchants sufficient lack cash up front to buy the amount of inventory they hope sell on Alibaba.

mission

As of September 2012, Alibaba, China’s most successful e-commerce company, had supported more than 15,000 of its merchants with an average of $7,400 distributed per loan. Alibaba’s lending is not restricted simply to its merchants. The company has also teamed up with major financial institutions, such as the China Construction Bank, to provide an array of loans to small and medium-sized enterprises (SMEs) more generally. This operation, run through the Alibaba Group’s Alibaba Financial Company, is driven not simply by the e-commerce giant’s desire to increase transactions on its web platform, but rather by a general niche in the Chinese micro-finance market.

e-Commerce: China & the USA on the ring

Alibaba from China, Amazon from the USA, Rakuten from Japan are dominant players in the world of e-Commerce.

Alibaba is growing very fast but the group with a revenue of $1 billion in 2011 is still small compared to Amazon Inc. Revenue of the American company reached $48 billion in 2001: +41% growth year on year.

However, with the current situation, we can expect Alibaba generating more sales than Amazon from year 2017.

Amazon has a few points of market share in China. The leader is Tmall, a site from Alibaba. The second player is 360buy (less than half the sales of Tmall). Suning, Dangdang and the other players are less dominant.

@value2020 American & Chinese eCommerce – October 2012 – https://value2020.wordpress.com/

@value2020 American & Chinese eCommerce – October 2012 – https://value2020.wordpress.com/

In October 2012, while Amazon launched a page to sell wines, 360buy launched an English version of its website. This is part of the strategy of Chinese firms to expand outside of China.

Traditional retail companies are focusing on increasing online sales. With $4.9 billion, online sales of Walmart represented 10% of Amazon revenue.

The digital strategy is crucial to marketing strategy to reach potential buyers. A focus on main players is essential.

-Search engine: Google, Baidu

-Social media: Twitter, Facebook, Qzone, Sinaweibo, Youtube

If the marketing budget is enough large, you can target also the relevant other players for your brand. If you target China, Qihoo is getting attention from users right now.

It will be interesting to see the path of Tencent and Baidu in the world of e-commerce. They have powerful marketing tools with WeChat (Weixin) and Baidu analytics and advertising.

Sources:

Alibaba Group, URL: http://img.alibaba.com/images/cms/upload/alibaba_group/about_alibaba/b2b_releases/20120221_alibaba_announces_2011_q4_and_fy_results_eng.pdf

Amazon.com, URL: http://www.amazon.com/b?ie=UTF8&node=2983386011