Answer

Use of technology to increase Alibaba’s profit margin by 10% more than industry average

•       Introduction (about Alibaba )

•       Pros of Technology

•       Cons of Technology

•       How to implement technology to increase  profitability

•       Alibaba Group, founded by Yun (Jack) Ma, is a global leader in the provision of Buyer-to-Buyer (B2B) e-Commerce services, incorporated in Hangzhou, China in 1999 (Glowik, 2017). Recent data associate the group’s dominance with a 693 million  active  users as of September 2019 and revenues topping US$15.3 Billion and a net income of US$11.0 Billion in 2016 (Anvari & Shirkhodaee, 2020; Glowik, 2017). The company has created innovative models to create “value-added e-marketplace”, through a constellation of cutting-edge services and internet-based plans aimed at small and medium-sized enterprises (SMEs) in global markets (Anwar, 2017).

Pros of technology

4 enduring contributions of technology to the growth of Alibaba are considered:

Circumvention of physical barriers to reach remote area Global reach

In recent history, the company strategy has been achieved through tactical corporation with Yahoo China in 2005, introduction of Alibaba.com in 2007, purchase of HiChina and subsequent takeover of its superior infrastructure, and AliExpress for conveyance of the group’s products and services to previously inaccessible parts of the world (Glowik, 2020).

Rapid Expansion

The Alibaba realm has undergone rapid tech-mediated expansion to a total of seven portfolios, namely, “Alibaba Small Business Operations, Taobao, Tmall, Alibaba International Business Operations, Juhuasuan, eTao and Alibaba Cloud Computing” (Yazdanifard & Li, 2014; Glowik, 2020).

Platform Integration

Recent line extensions have facilitated growth of Alibaba from a mere digital B2B trading platform to an aggregation comprising of “e-payment systems, cloud computing, internet infrastructure, and “third party” e-commerce” and internet-based business-to-consumer (B2C) services. For instance, the integration of B2B and B2C with e-payment services offers inventive purchasing and financing alternatives, as well as credit facilities effectively putting the company ahead of the pack (Glowik, 2017). In fact, inflows from “loans to sellers” on platforms rose beyond 7% of overall income (Glowik, 2017).

Innovative offerings

Alibaba’s innovative edge has been demonstrated through its transformation of China’s “twitter” Sina Weibo by injecting USS$586 million to micro-target users of the social media platform and linking them to the Alibaba site (Glowik, 2017). Similar studies associate the enhanced social media presence brought great returns taking the group’s promotional activities to mobile handsets and enhancing customer traffic to the group’s Taobao Marketplace. In 2014, an innovative venture between Alibaba and Intime to develop a novel platform known as online-to-offline (O2O) created China’s largest e-commerce operator by integrating online and offline shopping (Glowik, 2017).