Is possibly going to be Alibaba very soon.
For a long while following it’s IPO in 2014, investors were highly skeptical of Alibaba. Many still are, but many more are starting to recognize Alibaba’s incredible dominance in China. More importantly, as mentioned briefly in my post Tencent vs Alibaba on the Quest to Go Global, the company stands a fairly good chance of going global.
Despite the rising enthusiasm for Alibaba, the company appears to be underrated. A few examples:
- As of FY16, Alibaba reported gross merchandise volume (GMV) of $547 billion across its e-commerce platforms. Amazon does not report GMV but estimates peg it around $300 billion.
- Alibaba had annual active buyers of 466 million as of 2Q17. Amazon does not report annual customer count, but Statista pegs it at ~300 million.
- Alibaba owns approx. 1/3 of Ant Financial, which is the world’s largest fintech co. Amazon has surprisingly limited interest in fintech.
Amazon is rightly known as an aggressive competitor, but Jeff Bezos once squared off with Jack Ma in China and lost (Amazon was also relatively late to China). Both are now vying for control of India. But their strategies could not be more different: Amazon is essentially carrying out a very similar playbook to the one in the US (superior distribution/logistics + Prime), while Alibaba has gone the fintech route and leveraging that to enter e-commerce.
Will be interesting to see how India plays out since Amazon is determined to not let India slip out of its hands and is currently near pole position.