The impact of Alibaba is not fully appreciated outside China as much as it is within China. Outside China, people may have known the big IPO of Alibaba ($25 billion in 2014) and perhaps some odd founder but I don’t think they understand how much the Internet has changed people’s lives and, particularly, companies such as Alibaba boosted that process. Without the internet, it’s hard to imagine how China would have evolved over the last few decades and how the private sector would have driven the county forward.
When it comes to Jack Ma, the founder of Alibaba, he is presented as a very entertaining person. The book goes back to his youth, the struggles and the failures that he had in the past. Jack is a self-made man, not interested in the government-connected privileged Harvard types. Moreover, he is a kind of icon in China as he did not come from a great family. He did not have a great educational background and yet he was able to achieve a position of business magnate, investor, philanthropist and a global ambassador for Chinese business. He started out as a translator but, simultaneously, was selling carpets on the side to make ends meet. The book also tells a few stories which depict how tough his career was. For instance, once he tried to get a job at KFC, together with other 23 candidates. The only person who was rejected was Jack.
Later, the book focuses on his business endeavours. On one hand, the book presents him as a very dedicated and passionate entrepreneur, focused on customers, employees and technology. On the other hand, the story clearly underlines that he didn’t have any clear vision of making business on the internet and, actually, he and his companies have evolved based on issues he got to grips with.
In great majority, the book focuses on the story of Alibaba and Taobao. How these companies looked like at the beginning and how they have performed over time. It is worth to say that for almost five years the whole platform was free and the goal was to provide business-to-business (B2B), consumer-to-consumer (C2C) and business-to-consumer (B2C) sales via its platform. These companies were far from being successful overnight, however, the book provides a logical and disciplined approach of shaping their current structure and values. The book also details the scale of the business based on the singles’ day in 2015, the equivalent of Black Friday, when Alibaba’s website generated four hundred and sixty-seven million packages requiring more than 1.7 million couriers and 400,000 vehicles to deliver the goods. It also states that Alibaba would not be the giant as it is today without its army of couriers which adopted clever methods to keep the cost at rock-bottom. In Shanghai, for instance, couriers shuttled back and forth on the subway passing packages over barriers to one another to avoid buying multiple tickets.
The book is also a riveting story of how the company competed with major multinational conglomerates specialising in e-commerce and retail. It was really interesting to read about how a better understanding of local customs has helped Alibaba to battle much bigger companies such as E-bay, Google or PayPal.
The one thing about why is Alibaba so impactful is Jack’s formulation of the iron triangle. this is bringing together e-commerce, finance and logistics. This is why the company is so dominant today. The rarest commodity in China today, other than fresh air, is trust. And by bringing these three things together over the last several years since Jack founded the company is that Alibaba has achieved dominance and a very defensible position. What this means is if you order on Alibaba a product you know there will be reliable delivery and also if you pay for it, you are not going to get ripped off. In fact, as a consumer, you can return the product in up to seven days, even if there is no defect with it. So the point is that Alibaba basically created awareness for consumers of their rights. In many cases, for the first time, it brought choice and consumer satisfaction. Moreover, these features were offered to not only people living in major cities but also, to people living in rural areas.
So nowadays, Alibaba provides electronic payment services, shopping search engines, cloud computing services and became one of the most valued, admired and the biggest companies around the world. It has outperformed many well-known and broadly respected companies forced to withdraw the lucrative Chinese market.
Alibaba: The House That Jack Ma Built
by Duncan Clark
In the article I made use of a few author’s interviews.
Size: 304 pages
Other information and reviews of this book on Goodreads: https://www.goodreads.com/book/show/25817524-alibaba