IDG (Tong cloud) Beijing June 13, the Alibaba Group is to adopt a new ways to improve their online sales: their businesses to provide subsidies to help lower prices.

China’s largest e-commerce company plans to invest 300 million yuan (about $ 47 million) to a summer promotion, the promotional activities targeted products, including from the iPhone to your TV then to the air conditioning and other various commodities sold by the group’s Lynx Network. This site operated by the online shopping market and , eBay service similar the site is its merchants trading to provide subsidies for consumers.

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this plan to further expand the Alibaba Group and Jingdong Mall competitors to compete for China’s Internet shoppers between the “war.” According to the Boston Consulting Group (Boston Consulting Group) estimate the total number of Internet shoppers in China has reached 193 million people.

Advisors, Managing Director of the

market research firm RedTech Michael Karen Denis, Michael Clendenin, said: “They (the Alibaba Group) is out from his pocket money to help customers reduce commodity price, so take this from the Jingdong Mall scramble for subscribers, which is a very radical step. “According to the marketing plan is important to consumer electronics, the Lynx online merchants to the site to apply for subsidies to make up for the discount brought about by the loss of income. In addition, Alibaba Group directly to consumers to provide a refund.

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attract shoppers to the Lynx net shopping a key in the strategic plan developed by the Alibaba Group CEO Jack Ma (the micro-blog ) content, the program aims to take advantage of the prosperity and development in online sales sales to help the group to achieve higher growth. Currently, Alibaba Group is seeking access to debt and equity financing to help the group Yahoo where to buy back its own shares.

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today Alibaba Group is an e-commerce company, is an Internet empire. “said Ma interview in Beijing on June 7. “In fact the Alibaba Group is not an empire, but an ecosystem.”

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Ma said at the time, the Alibaba Group may in the next five years through IPO (initial public offering) transactions listed, adding that he believes that the Group has the ability to withstand the test of live new challenges. Ma also pointed out that in the Chinese market, the competitors faced by the Alibaba Group in the area of ​​electronic commerce are mostly copied the Internet business model, “imitation is always able to survive to go on.”

best position

According to market research firm Analysys International released data show that transit cat in the first quarter in China’s B2C e-commerce market share of 37%, 17% share than Jingdong Mall share more than double, which is ranked second in this market practitioners companies. The data also shows that Suning Appliance, the Amazon over the same period in the market share for about 2%.

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China Market Research Group to provide consultancy services for retailers, analyst Ben card Bonaventure (Ben, Cavender) said: “Alibaba Group is likely is in the best position – already have a platform, but also has a large number of users. “

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According to Boston Consulting Group forecasts, the number of online shoppers in China than the U.S. market, and the value of e-commerce market in China in 2015, quadrupling to $ 364 billion. Another market research firm RedTech pointed out that the reason more and more Chinese consumers ongoing online shopping, e-commerce market sales proportion of total retail sales this year will reach 5.3 percent, higher than the United States to 4.9%.

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online business growth

Internet research department of Barclays Capital in Hong Kong person in charge of Alicia Yap (Alicia Yap) pointed out: “The online retail market is becoming a huge independent economic growth rate will be in the future significantly accelerated. “

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analysts card Bonaventure pointed out that in the situation of China’s economic growth is slowing down, online retailers to provide lower prices may help them to attract a strong cost-conscious consumers. In the first three months of this year, China’s economic growth rate of 8.1 percent, the fifth consecutive quarter slowdown.

Bonaventure of the

card said: “Even in the case of the economic downturn, the impact of e-commerce company will also lower than those mortar retailers.”

Gome the

( microblogging ) and Suning

The success of the the

Alibaba Group will increase the pressure faced by the Suning Appliance and Gome ( microblogging ) chain of consumer electronics operators, these companies are transform their own online business to retain customers. At present, the electronics retailer’s profits and share prices continued to rise, Gome and Suning mortar retailers are just the opposite.

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Su Ning said, the company in its e-commerce site easy to purchase online to offer new products and to increase promotional efforts. In addition, Suning Appliance has launched a 200 million yuan plan for customers to find cheaper prices elsewhere product refund the difference.

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Gome with Chinese e-commerce website Dangdang (NYSE: the DANG ) reached a distribution agreement, which is China’s largest Internet bookseller. Gome said last month that the company’s online business investment is likely to impair its profitability. In addition, the United States also has agreed to sell 40% stake held by the the Kuba shopping network and cutting-edge the United States electrical store sector Gome founder Huang Guangyu, the holding company.

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“We have already felt the white-hot competition from traditional and online retailers. Gome CFO Fang Wei said in a conference call.

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States United States e-mailed statement, said the company’s two Kuba shopping network and the country the United States the official online store of e-commerce sites and online retailers in the areas of procurement, logistics and delivery compared to dominant .

Alibaba profit

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in today’s trading on the Hong Kong market, Gome shares rose 1.7 percent, to close at HK $ 1.11. So far this year, Gome’s share price has fallen by 38%. During the same period, Dangdang shares in the Shenzhen market transactions rose 20 percent, while Suning’s shares were up 4.2%. Alibaba Group and Jingdong Mall are closed privately held company.

according to Yahoo submitted a regulatory filing last month, as of December 31 of last year, a quarter, net profit of Alibaba Group, a substantial increase seven-fold to $ 237 million . The file also shows that the Alibaba Group in the quarter, revenue grew by 88, to $ 1.02 billion. According to data released by Analysys International, Alibaba Group’s online advertising revenue in the China market ranked second, just behind the search giant baidu (NASDAQ: BIDU ), mainly due to sales of keywords and banner ads perform well.

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Alibaba Group business model is similar to the world’s largest online shopping site eBay, Jingdong Mall and Dangdang is more similar to the Amazon, focus its efforts to sell the goods, rather than the external business provides an online sales platform.

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lower risk

Karen Denis,,

RedTech analyst pointed out that Alibaba Group’s profitability is higher than the competitors, the reason is that the group does not warehousing of goods. This means a lower risk of Alibaba Group’s profit margins in a price war frustrated.

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for, they (the Alibaba Group) is only an online real estate company to sell space on their server (online merchants). “said Karen Denis. “Alibaba Group, do not assume any inventory risk.”

initially the

Alibaba Group online consumer shopping site Taobao allow small businesses without having to pay the costs of goods sold to consumers, the Lynx network, compared with larger companies to provide services, to charge service charge and extraction of the commission. the Dell and Japan’s largest apparel retailer Fast Retailing’s Uniqlo (Uniqlo) clothing Lynx network platform to reach the higher end of the online shoppers.

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competitors online sales market investment, as a response to the Alibaba Group. Jingdong Mall and Dangdang are expanding their online marketing department, in series with its own online retail business. Jingdong Mall also said that the site will provide consumers with the marketing plan of a total of 1 billion yuan.

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Analysys International in Beijing, e-commerce analyst Chenshou Song (phonetic) said: “Alibaba Group’s financial strength means that this group has the ability to invest in marketing activities for a variety of platforms. They will take any necessary measures to repel competitors, in order to establish a significant leadership position in the market. “