The E-commerce market is growing rapidly with global players making major investments in different regions to establish their dominance.
Amazon and Alibaba, the largest eCommerce companies in the world are heading towards a direct battle against each other. Both are the biggest E-commerce companies in their individual home grounds, but the similarities pretty much end there.
Basically, they are different business models operating in very different economies, which we will dive into in the “The War for Ecommerce Domination- Alibaba vs Amazon” infographic below.
The War for Ecommerce Domination- Alibaba vs Amazon Infographic Summary
Amazon was founded as Cadabra by Jeff Bezos in 1994. It was later renamed Amazon in 1995, the online bookstore. Since then, they have grown into the largest online retailer in North America. The major portion of Amazon’s revenue comes from electronics and merchandise, media content streaming, distribution and logic support and cloud computing via Amazon Web Services (AWS).
Alibaba was founded in 1999 by Jack Ma and 17 other co-founders as a global wholesale marketplace in his own apartment. It operates a number of ecommerce sites aimed at different types of sellers. The largest of Alibaba’s sites, Taobao, is a fee-free marketplace that connects buyers and sellers and generates revenue by selling ads against select pages and search results.
Both these Ecommerce giants offer a long line of services and products and are looking for new opportunities to expand their level of operations.
Besides the range of services and products under the Amazon tag, the company is offering physical products (Alexa and Kindle being the notable ones) and has ventured into partner ecommerce businesses such as Junglee.com, and even retail chains like Whole Foods.
Alibaba has spread out to ecommerce business, digital payment services (Alipay), and even cloud computing services. In the year 2013, two of Alibaba’s websites handled $240 billion in sales (which is double the size of Amazon and triple the size of eBay).
Amazon’s operations are spread all over the USA, Asia, and Europe and they offer international shipping to more than 100 countries. Alibaba has suppliers and buyers in about 200 countries.
The prominent role of Amazon in Ecommerce growth in the United States is notable. Amazon alone accounted for 53% of online sales growth in the US in 2016. This means that Amazon took 53 cents out of every new dollar Americans spent online!
Apart from this, Amazon accounted for 3% of the total retail volume in the US. Alibaba is a much bigger player in their home territory – China. The group accounts for 11.18% of the total retail volume in China.
In the battle of Amazon and Alibaba, who will dominate global ecommerce? Even when Amazon is more innovative, Alibaba has huge growth potential in their own home turf.