How did Alibaba beat Global Sources?

By justchinait
 / 
January 12, 2021
 / 

Let’s take Alibaba as an example to objectively analyze the development and evolution of the buyer-seller relationship.

Business model

1999-2010:

In 1999, Alibaba was officially launched as an international B2B platform. At that time, his main opponent was Global Sources. Global Sources is an established B2B website, established in 1970, and listed on NASDAQ in 2000. Ten years ago, the minimum annual promotion charge of Global Sources was 40,000CNY, while the minimum charge of Alibaba was 19,800CNY. At that time, lighting-related companies could also receive 5,000CNY government subsidies if they became Alibaba’s suppliers.

How did Alibaba beat Global Sources?

1. Constantly updating the product can make the product ranking high.

Low prices will surely grab some customers, but the most attractive place for customers at Alibaba at the time was not the price, but the concept they promoted: you have money to pay, or you can work hard.

Low-level members can make their products rank high by paying more labor. Regardless of Alibaba or Global Sources, they will rank members according to the amount of dues paid. The more you pay, the higher the membership level, the higher the ranking on the search page, the easier it is for customers to find, and the greater the chance of a deal. .

However, some members do not have that much money and can only make the cheapest plan. So Alibaba’s salesperson said that it doesn’t matter if you have no money. As long as you keep updating the product, you can still rank in the top of the first page. Every time they visit a new customer, the salesman will open the page to let the customer see how some low-level members are ranked first. This concept has attracted a large number of small and medium-sized enterprises for Alibaba and made them their loyal fans.

Looking at Global Sources, there is no change at all, or the implementation of the policy of paying for rankings. The first round can be said to be a complete failure. Alibaba has occupied half of the international trade B2B platform in a short period of time with absolute value-added services, and obtained a large number of loyal members.

2. Customer information such as phone number and email address can be inquired.

Before 2010, in order to attract more companies to become their members, Alibaba issued a very good policy. Non-paying members can search for various buyer information on the website homepage, including company name, address, and phone number. In addition to this information, paid members can also see the buyer’s email address.

This kind of policy is simply a life-saving straw for SOHO and some offshore trading companies. At that time, the SOHO family who didn’t have anything could register for a free account, call and screen the potential customers one by one, and even get big orders.

After 2010:

1.Cancel the buyer information search function

Unfortunately, since 2011, this buyer search function has disappeared. Even paid members cannot see the buyer’s contact information, but can only see the purchase needs. If you want to contact the buyer, you have no choice but to send a quote. In this way, the individual’s subjective initiative is greatly restricted. Alibaba said that the cancellation of the buyer search function is to protect the privacy of buyers.

2.Paid listing

With the increasing number of paying members of the Alibaba, its rules are constantly changing. At first, the concept of ” you have money to pay, or you can work hard ” was abandoned and turned into a ” Paid listing”. As the name suggests, rankings can be sold. The first to twentieth place are clearly marked with a price. It is impossible to get to the first page even if you work hard to update your product.

3.Keywords

Then, the keywords that customers searched for are also clearly marked, keywords with high search frequency are sold to companies at high prices, and companies continue to buy at high prices, because who gets the keywords that are frequently searched means the probability of being found by buyers increase.

4.Golden Supplier, OneTouch,Trade assurance

Golden supplier
Trade assurance

Later, they launched the “Golden Supplier”, saying that the logo granted by Alibaba will make buyers feel more at ease with the company. Of course, this logo is not free, and suppliers still have to pay for it. Later, they launched OneTouch, Trade assurance, and the criticized P4P. This money-burning ranking model is no different from Baidu’s bidding ranking.

In the course of this series of reforms, in order to compete for limited customer resources, suppliers have invested more and more, and Alibaba has made a lot of money. But at this time, Alibaba suppliers do not have much choice but to be pushed forward by the trend.

Alibaba is already a colossus, and most of the China international trade is in his hands. Leaving Alibaba means starting again, so suppliers has to follow. According to the new rules, suppliers will be ranked by the amount of online transactions in the future. Many companies have to abandon the import and export companies that they have worked with for many years and use One Touch or Credit Insurance to pay because they want to rank high, but there is nothing else to select.

At this point, Ali has completed the process of making customers sticky to themselves.

Partners

Build your own business to provide China-First Made in China services to businesses around the globe - all while growing your knowledge and have a happy win-win life.
Be our Partners

Grab the best Opportunity!

Get posts by email

Be the first to see when we publish a new blog post!

We've delivered over 21,776 cheaper for clients. Find how we can help your business growing.

Ready to speak with an importing expert?
Please give us a call or e-mail.

+86-150-1926-7452

info@justchinait.com

156 Serving Countries Around The World

11 Years of Experience Purchasing and Exporting

900+ Trusted and Satisfied Clients With Profit Growth

90,000+ Verified Manufacturers, Wholesalers, and Traders

View 300+ Client Reviews