Alibaba says that it is sacrificing profits to invest in B2C. Is Taobao's chance to choose a heart?

　　#Laogao E-commerce Information# On June 8, China's e-commerce platform giant Alibaba Group Holding Ltd. said at its investment day event on Thursday that it expects revenue to grow by 45%-49% in the current fiscal year, far exceeding the average market analysis expectations of 35%. The above expectations also stimulated Alibaba Group's stock price to rise sharply before the market. In addition to boosting revenue expectations, Alibaba Group CEO Daniel Zhang Zhang Yong also said in his speech that the group's mid-term target GMV for 2020 is US$1 trillion, and the long-term target is to serve 2 billion consumers around the world by 2036; Group Chief Financial Officer Maggie Wu Wei also said that the group will use "annual active consumers" to replace "annual active buyers".

　　The above statement changes are also the transformation of Alibaba Group's hope to provide consumption scenarios to customers and consumers to lifestyle scenarios. The "ideal life" community is becoming a new scenario that the group hopes to build.

　　This year's Tmall 618 promotion was named "Ideal Life Carnival" by the group. In addition, in Alibaba's financial report, the group's cloud services and digital entertainment related businesses have also been disclosed more and more, and the proportion of related business revenue has also increased accordingly. Corresponding to the construction of new scenarios, Wu Wei also said that the group will disclose "customer management revenue" to replace the previous "online marketing revenue".

　　Alibaba's current main business and revenue still comes from its e-commerce platforms Tmall.com and Taobao.com Taobao, and its revenue model is sales commissions and marketing expenses. Alibaba's chief financial officer Maggie Wu Wei However, Alibaba is also facing many problems at the moment, especially its core retail service business has been hit by competitors JD.com Inc. and Tencent Holdings Ltd. JD.com, which started out with self-operated electrical appliances, is trying to expand its general consumer goods business and platform business after consolidating its 3C business, which is a retail platform under Alibaba is good at. Tencent Holdings, which owns China's largest application WeChat, has not yet vigorously developed its marketing business, but whether it is a large number of brands entering WeChat to sell products or its WeChat circle advertisements, it is a potential threat to Alibaba.

　　In addition, Tencent Holdings and JD.com are also affiliated companies, the former is the largest shareholder of the latter. Regarding the retail business, Wu Wei also said that the group will sacrifice part of its profitability and continue to invest in order to attract new customers and expand the sales foundation of its B2C business. In addition to continuing to attract global brands to join Tmall, Alibaba has also been involved in investment in some retailers, including Intime Commercial, which has just been privatized and Southeast Asian e-commerce Lazada Group SpA, which was controlled for US$1 billion last year. At the end of last month, Alibaba also acquired 200 million domestic shares of Lianhua Supermarket and became the second largest shareholder of the Chinese supermarket chain giant.

　　Alibaba's Taobao platform launched its own business "Taobao Xinxuan" compared with the above investment, what is more worthy of attention is Taobao Xinxuan, a self-operated B2C business launched by Alibaba on Taobao platform at the end of last month. It adopts the Taobao Xinxuan promotional slogan "Select with care and choose with confidence". Its operating model is almost exactly the same as NetEase Yanxuan's business, an e-commerce platform under NetEase, Inc. NetEase. It adopts the P2C model, bypassing channel merchants and directly picking up goods from manufacturers and selling them directly to consumers, and selling them at low prices through reducing intermediate links. Due to the continued weakness of global retail industry, China, as a major manufacturing country, is currently extremely difficult, and the P2C model is the easiest way for many OEMs to seek transformation. On the other hand, some traditional Internet companies seeking business expansion also hope to expand new revenue methods, so P2C multi-category e-commerce such as NetEase Yanxuan and Mijia Youpin, which focuses on lifestyles, was born.

　　Like NetEase Yanxuan and Mijia Youpin, Taobao Xinxuan's operating entity is Hangzhou Xinxuan E-commerce Co., Ltd., which is a subsidiary of Taobao (China) Software Co., Ltd., that is, this business is Taobao's own business. Among the three major P2C e-commerce companies in China, NetEase Yanxuan is definitely the one who is currently in the lead. On the one hand, it started early, and on the other hand, NetEase itself also has considerable traffic advantages and media publicity advantages. Mijia Youpin has certain advantages in mobile phone manufacturing in small electronic products with Xiaomi technology. As for Taobao Xinxuan, the advantages of relying on Alibaba’s platform are self-evident.

　　Since Taobao Xinxuan’s launch is quite low-key and is very different from Alibaba’s usual style, it is not clear at present the group’s specific attitude towards this B2C business and its subsequent development. Wu Wei did not point out at the investment day event on Thursday that the group's investment in B2C business and attracting new customers are mainly aimed at the existing platform business, or include Taobao Xinxuan's self-operated B2C business.

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