Alibaba's e-commerce app finds success with social networking features
Alibaba Group Holding has tried to shake the perception that it is just the eBay or Amazon.com of China, by pushing into social media and entertainment and actively investing in start-ups like Snapchat.
Chairman Jack Ma Yun’s sprawling pursuits are starting to pay off. Alibaba’s Taobao mobile app is a riot of tiny print and icons that allow users to join a chat group for fishing enthusiasts, book a trip and buy a new rod. The one-stop-shop format has resonated with China’s young users, who are spending longer on the site than visitors to Amazon or Twitter’s mobile sites, and has helped more than double mobile revenue in the most recent quarter.
“To capture the attention and imagination of young people you have to provide more social features,” Alibaba’s co-founder and vice-chairman Joseph Tsai said. “We want to continue the sense of community so that they’ll come back and engage with the platform.”
Alibaba started Taobao in 2003 as an eBay-like site for small businesses and entrepreneurs to sell directly to consumers. In the last few years, it has added social and entertainment features to keep people on the app longer, increasing the chance they will buy products. The strategy worked. Monthly mobile active users increased 39 per cent to 427 million and mobile revenue jumped to US$2.6 billion in the June quarter. People visit the app more than seven times a day for more than a total of 25 minutes. That compares with about nine minutes on Amazon’s mobile app and 16 minutes on Twitter’s app on days when users visit.
We’re already at the holy grail point where our users have very high desire to buy things and they’re very commercially minded
“Amazon doesn’t get people on the website seven times a day,” said Gil Luria , an analyst at Wedbush Securities. “The level of engagement Alibaba’s able to create is more than what we’d consider with search companies and social companies. They’re investing a lot into making their tools have social engagement like Facebook.”
Taobao users can join one of its 1,000 special interest groups to chat about topics from wedding planning, to sports to baby showers. Last year, the site started a programme to get bloggers and experts to post content by offering them a commission for making product recommendations.
Alibaba also recently rolled out the Taobao news feed that has grown to more than 1,300 media outlets that provide content to its 80 million-plus monthly active users. A few months ago, Taobao added video live-streaming for bloggers and merchants to interact with consumers.