Published by MBA Skool Team, Last Updated: December 31, 2017
Marketing Strategy of Alibaba analyses the brand with the marketing mix framework which covers the 4Ps (Product, Price, Place, Promotion). There are several marketing strategies like product innovation, pricing approach, promotion planning etc. These business strategies, based on Alibaba marketing mix, help the brand succeed.
Alibaba marketing strategy helps the brand/company to position itself competitively in the market and achieve its business goals & objectives.
Let us start the Alibaba Marketing Strategy & Mix to understand its product, pricing, advertising & distribution strategies:
Alibaba Product Strategy:
The product strategy and mix in Alibaba marketing strategy can be explained as follows:
Alibaba is one of the leading ecommerce website companies based out of China. There are many different services and products offered in its marketing mix. There is Alibaba.com which is the world’s largest B2B sales platform for small enterprises. Aliexpress is an online retail store for buying products which are exported to a whole lot of countries by Chinese businesses. Autonavi which offers maps is the market leader in navigation in China. Taobao is one of the largest consumer to consumer online shopping platform which offers commission free transactions. Alibaba also has a group shopping platform called Juhuasuan which offers flash sales. Alipay is another of its services which is a platform for online payments without any transaction fees. It is also present in media with its own film company called Alibaba Pictures. Alisports and Ali health are the other two services for sports events and pharmaceutical ecommerce platform respectively.
Alibaba Price/Pricing Strategy:
Below is the pricing strategy in Alibaba marketing strategy:
The pricing strategy that Alibaba uses is penetration pricing as it seeks to enter newer and newer markets.
It therefore offers discounts and cash backs to the customers on its site and reduces its cut from the transactions. Some of the services that they offer do not involve any transaction cost. Some of the services like Aliexpress have no registration fee as well. The primary revenue earned by Alibaba is through the advertisements that are done on their site by businesses. The secondary revenue is from customers who take membership. It also sometimes employs competitive pricing to offer products at prices similar to the competitors to drive the sales. Overall it is much more economical for most of the users.
Alibaba Place & Distribution Strategy:
Following is the distribution strategy in the Alibaba marketing mix:
Internet is used by Alibaba as the intermediary. Its services are online and therefore are distributed through websites. Through this they are able to reach a wider audience for their niche products. Almost 80% of ecommerce in China happens on Alibaba. Because of the digital platform for conducting business they are able to cut down on distribution costs. They have recently made a foray into the US market with an IPO which is one of the biggest in its history. Alibaba has many manufacturers on its list, so orders can be placed in a bulk and they will be shipped from these manufacturers in India, Pakistan or Czech Republic to the place from where they are ordered. The payments can be done through Alipay, wire transfer or Western Union.
The warehouses are well equipped with state of the art technology to process the orders.
Alibaba Promotion & Advertising Strategy:
The promotional and advertising strategy in the Alibaba marketing strategy is as follows:
Alibaba promotes the brand through a number of channels. It advertises through traditional channels like print media, radio and TV advertisements. It advertises through catchy taglines. As most of the services offered are online Alibaba promotes through digital media as well. They have also been the sponsors for international events like Beijing Olympics. It has also sponsored Australia-China Business Week which was one of the high-profile events in the business world. The other ways in which it promotes itself is through offers, discounts, festive sales and cashbacks for purchases on its ecommerce platforms.
Since this is a service marketing brand, here are the other three Ps to make it the 7Ps marketing mix of Alibaba.
The physical evidence of Alibaba includes the intangible aspects of service like the delivery schedule which has to go as promised. The products delivered should be as per the order and quality desired. The transactions should be smooth and trustworthy and the ecommerce platforms should be user friendly and attractive. These aspects form the physical evidence of the company.
Alibaba offers shopping platforms and the way the whole process takes place is simplified. The shopping can be done on a wholesale basis, group shopping, or customer to customer. The manufacturers make the products according to the order quantity and ship them. The customers who want to sell, sell the products directly to other customers. The transactions can be done through either Alipay or Western Union and similar platforms.
Jack Ma is the CEO of Alibaba company as of now. There is a board of directors which is the top management of the group. This is followed by the operations, finance, marketing and customer service departments. The lowest level is the one having manufacturers and sellers. The organization has a major emphasis on the engineering department where they hire only from top institutes. The engineers are extremely skilled in their domain and adaptable to the changes in technology as it is the department which is at the core of the business. This completes the marketing mix of Alibaba.
Alibaba is an ecommerce platform founded by Chinese entrepreneur Jack Ma in 1999. It provides b2b, b2c and c2c services via web portals. The company operates primarily in China and as of 2016 has had a sales revenue of almost 240 billion US dollars. Hence it is one of the most valuable companies in the world.
Alibaba continues to grow far and wide covering a number of nations to offer its varied reputed services. It faces stiff competition from other ecommerce sites like Amazon, Flipkart etc.
This article has been researched & authored by the Content & Research Team. It has been reviewed & published by the MBA Skool Team. The content on MBA Skool has been created for educational & academic purpose only.
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