Competitive Strategy for Alibaba and Tesco - myassignmenthelp.com

Question: Discuss about theCompetitive Strategy for Alibaba and Tesco. Answer: Alibaba Group Alibaba Group is a Chinese company established in 1999 in China. The companys headquarters are located in Hangzhou, Zhejiang, China. The company was founded by Jack Ma. The company is an e-commerce website that provides customer to customer, business to customer and business to business services to its customers. It has operations across 200 countries. In 2016 the company defeated worlds largest retailer Wallmart and secured the topmost position. The company began as a website that was designed to help small Chinese manufacturers and retailers to sell their products in global markets. Now the company is a world leader in online and mobile e-commerce. Today the company has expanded its portfolio to digital media, cloud computing and entertainment (Alibaba group 2017). Today Alibaba is more successful than eBay and Amazon together. The credit for Alibabas success could be credited to unique business model and sustaining the competitive advantage through innovation and development. The company had a unique business model that was designed only for small enterprises. This model provided value to small enterprises that were not possible individually (Pavie 2016).Alibabas business model is different from that of competitors rather than normal e-commerce company, Alibaba makes efforts to provide best service quality to sellers and buyers. The company works on the principle of collectivism and trust. People look up to Alibaba as a platform where they can build up trade connections with people internationally. It is easy to gain competitive advantage but difficult to sustain it. Every company needs to do something innovative in order to remain in the competition. The company sustained its competitive advantage through time to time innovations. The major s uccessful innovations that helped the company secure current market standing are discussed below (Success story 2017): In 2003 Alibaba founded Taobao. Taobao is a customer to customer retail sales website of Alibaba group. In 2004 the company offered Alipay. It is an app which holds payment and releases it to the seller only when the product is received. In 2005 the company entered into a partnership with Yahoo and acquired Yahoo China. In 2008 the company launched a web portal known as Tmall. In 2010 company introduced a search engine for shopping named eTao. In 2011 the cloud computing team of the company launched mobile operating system. The above examples show that company did not stop at one place it continuously evolved to sustain the competitive advantage. The other reasons for Alibabas success are consistently creating value to the firm. The company always keeps its customers at first priority. Alibaba does constant efforts to increase customer satisfaction. The company reduces cost for customers by innovation in the traditional supply chain. The company also reduces the product turnover time by application of latest technology in the business. It has also launched a venture named Alipay which allows the customer to release payment after the product is received. To analyze the needs of its customers Alibaba takes help from its huge customer behavior data. The company offers various other support services to its customers (Redaction, R. 2016). Tesco Tesco is a British multinational company. Tesco is a well-known grocery and general merchandize retailer. It was founded by Jack Cohen. The company is having in the United Kingdom but it operates in various countries around the globe. Tesco began as a small market stall in 1919 and today it is a leading market player in the industry. It has around 460,000 colleagues. It has about 6,809 across the world. Tescos vision is to serve customers little better every day. Today the company has expanded so much and emerged as a leading retailer because of its continuous innovative offers. Tesco is worlds third largest super market group (Tescoplc 2017). From a small grocery shop, Tesco became a leading retailer in the industry. The reasons for the success of the company can be credited to customer intelligence, innovation and a strong presence on social media. Tesco is the company that works to gain profound knowledge of its customers so that it could analyze customers needs ahead of the competitors. This knowledge gave Tesco an opportunity to sell more goods and services than its competitors. The company works not only to attract new customers but also takes initiatives to sustain old customers. Tesco provides club cards to its customers that provoke its customers coming back to the company. It has also offered price benefits to its customers. The company launched a scheme in 2015 that guaranteed that if the sum total of 10 or more products will be more than any of its rival, then the company will refund the amount to the customers. The company used price as a weapon to gain competitive advantage (Lee 2016). The next thing that is the essence of companys success is innovation. The company implements innovative ideas to take the first mover advantage and lie ahead of competitors. Innovation ideas at Tesco are based on two factors that are customers needs and future forces (Destination innovation 2017). One of the most successful innovations of the company is virtual stores. The company analyzed that South Korean customers are very busy and work for longer hours. They do not have time and energy to visit the stores for grocery shopping. The company came with an idea of virtual stores; these stores reduced the need for going to the stores to shop for the grocery. These stores provided product catalog at places such as bus stops and railway stations. The customers can scan the QR code of desired product through a mobile app and utilize their waiting time by shopping for groceries (Creevy 2011). This venture of the company gained immense success and a major contributor of todays market standing of the firm. Anothe r reason for the firms leading position is its effective promotional strategies. The firm is continuously engaged in social media marketing. Tescos face book and pages are constantly upgraded with the latest offers and schemes. Tesco also gives various advertizements on YouTube according to the occasion. The company keeps constantly turned up with various other digital marketing platforms. The promotional strategies of the company are aimed at creating an emotional touch with the customer. References Alibaba Group, 2017. History and milestones, viewed on 18 August 2017 from https://www.alibabagroup.com/en/about/history Creevy, J. 2011. Tesco opens virtual store in South Korea, viewed on 18 August 2017 from https://www.retail-week.com/topics/technology/tesco-opens-virtual-store-in-south-korea/5028571.article Destination innovation, 2017. The innovation process at TESCO, viewed on 18 August 2017 from https://www.destination-innovation.com/the-innovation-process-at-tesco/ Lee, A. 2016. How Tesco Became the UKs Biggest Retailer via Word-of-Mouth, viewed on 18 August 2017 from https://www.referralcandy.com/blog/tesco-marketing-strategy/ Pavie, X. 2016. Seven reasons for Alibabas success, viewed on 18 August 2017 from https://www.digitalcommerce360.com/2016/07/27/seven-reasons-alibabas-success/ Redaction, R. 2016. The seven reasons for Alibabas success ; Alibabas development and framework, viewed on 18 August 2017 from https://www.retailnews.asia/seven-reasons-alibabas-success-alibabas-development-framework/ Success story, 2017. Alibaba Group Success Story, viewed on 18 August 2017 from https://successstory.com/companies/alibaba-group Tescoplc, 2017. Our businesses, viewed on 18 August 2017 from https://www.tescoplc.com/about-us/our-businesses/