On China’s Alibaba’s Five
Ps Marketing Strategies
WANG Guo-An
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Abstract
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An overview of Alibaba’s path of
development;
Alibaba’s effective marketing strategies
based on Professor McCarthy’s 4Ps theory;
Some suggestions on the improvement of its
marketing strategies regarding the fight
against the financial crisis worldwide which
began in 2008.
Outline of the paper
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Introduction
Alibaba’s Development Process
Alibaba’s 5Ps Marketing Strategies
Suggestions for Alibaba’s Marketing
Strategies in Global Financial Crisis
Conclusion
Introduction
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Alibaba includes five main branches:
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B2B websites, such as china.alibaba.com,
www.alibaba.co.jp,www.alibaba.com
www.taobao.com, www.alimama.com
www.alipay.com,
http://trust.alibaba.com.cn
www.alisoft.com
www.koubei.com
Alibaba’s Development Process
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The first phase (1998-2001): Providing free information for
companies to enter the market.
The second phase (2002): Carrying out the enterprise credit
certification for making profits.
The third phase (2003-2004): Developing overseas markets to
expand the scope of trade.
The fourth phase (2005-2007): Creating a new extendable ecommerce search engine after merging www.yahoo.com.cn.
The fifth phase (2008-): Developing a new online transaction
model to enter the B2C (business-to-customer) market.
Alibaba’s 5Ps Marketing Strategies
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Alibaba’s 5Ps marketing strategies, namely
Professor McCarthy’s 4Ps
Product
Place
Price
Promotion
PERSONIFICATION.
(1) Alibaba’s Products
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Virtual Product
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Convenient and prompt issuance and
management of information
China-tailored payment instrument
Sound evaluation system
Brand promotion strategy
Service Strategy
Figure: Three Parties Relationship
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(2) Price Strategy
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At the very beginning, Alibaba provided free
registration and information services for its
clients in order to elbow its way to the ecommerce market.
After a considerably big number of clients
have registered at alibaba, it began to charge
membership fees.
(3) Place Strategy
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Alibaba was established in Hangzhou, the capital
city of Zhejiang Province in the east of China,
developed its customers in the Yangtse Delta
Region, finally its customers have extended to all
over the world.
In order to get the lion’s share of the world market,
Alibaba has localized its e-commerce services by
creating different websites in different languages and
tailored their designs and layouts to the local
cultures and traditions in the local markets overseas.
(4) Promotion Strategy
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Alibaba precisely ascertains its clients, namely the
small and medium-sized enterprises (SMEs) and
individual businessmen.
Because Alibaba had limited financial resources in
its early stage of development, it established forums
and added its site links to those forums in order to
advertise its services, expand its recognition and
make sales promotions, and achieved good results.
(5) Personification Strategy
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In the terms of the webpage design, Alibaba
and Taobao have made efforts to make their
webpages simple and easy to operate with
Chinese characteristics and they are popular
among Chinese clients.
All messages sent by the Alibaba’s members
are classified and processed by its full-time
message editors.
Suggestions for of Alibaba’s Marketing
Strategies in Global Financial Crisis
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To offer free and testing services to its
new clients for a trial period in order to
reduce its clients’ financial burden and
to let them get familiar with the new
products and services.
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To further subdivide the target clients
according to their industries and
categories.
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To adopt a new price strategy and a
new fee-charging pattern to attract
more members.
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To build up the Customer Relationship
Management (CRM) system to reduce
the difficulty in trading.
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Banks worldwide supporting e-trade
and e-payment. E-trade involves epayment among different banks
worldwide.
Conclusion
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Alibaba has built an effective information bridge between
Chinese SMEs and overseas buyers and among individual
businessmen through its distinctive services, reasonable prices,
multi-dimensional marketing channels, novel dissemination and
promotion methods and high quality personalized services.
As a pacemaker in e-commerce, Alibaba has created a miracle
in China’s e-marketing in the 21 century after its 10 years’
development.
In 2008 the financial crisis swept the whole world. But in this
stage, both opportunities and challenges exist.
Alibaba should take advantage of the opportunities and actively
searches for new breakthroughs to further improve its
marketing strategies in proper time.
Thank
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