A Comparative Analysis Between The Business Models of Alibaba and Amazon!Posted by Angeline on May 22nd, 2019 E-commerce is evolving. A larger number of companies, both small and large, are offering their services online. To meet the needs of a variety of customers, many brick and mortar enterprises are now becoming digital storefronts. Some of the notable giants in e-commerce are Alibaba and Amazon. Both of them come under the category of e-commerce yet they differ in certain aspects. Let’s have a detailed look at their business models, Amazon Often hailed as the popular online retailer, its business model is different from the others. Besides direct selling, Amazon provides a platform for other retailers to sell products to buyers. It doesn’t charge its retailer partners for listing items on its platform, but it retains a part of the selling price as commission. This sometimes leads to an increase in the purchasing price of the products offered by other retailers. Amazon also earns revenue through its subscription business model of the video-streaming app, Amazon prime. It also generates revenue through its Kindle, an e-reader and mobile application. Alibaba Just as Amazon is as an e-commerce titan to Americans, Alibaba is to Chinese. But its business model is similar to that of eBay. It plays the role of middleman between buyers and sellers and earns revenue from the commission. Alibaba owns two other e-commerce websites called Taobao and Tmall. Taobao is a commission-free marketplace where buyers list items without any fee. Taobao’s primary source of revenue is advertising. While Taobao acts as a marketplace for smaller merchants, Tmall offers a dedicated space for larger retailers. Tmall caters to well-known brands such as Gap, Nike, Apple, and so on. Key Takeaways Though Alibaba and Amazon are different, both are operating and earning lucrative revenue without any physical presence. Thus Electronic commerce helps one to earn enormous revenue in a short span. How to Start an e-commerce Business? From ticket to food delivery and books to vehicles, every service and every product can be purchased online. Now, a successful business is not about having a big physical store but having a strong online presence that allows customers to buy everything from anywhere anytime. Multivendor business models like Alibaba and Amazon are instances that portray starting a similar platform is an easy way to earn income. Entering the marketplace with an app like Amazon doesn’t need a huge investment. AppDupe, a leading app development company offers an easily customizable Amazon clone with advanced features such as,
Gift Option This feature is similar to the online gift delivery service. It includes a range of options such as gift wraps, customized messages, and so on. Customer Management It helps you to manage your customer’s profiles easily. Additional features such as viewing and managing wish list, coupons, etc. are also available for registered or guest customers. Stock Management Our app monitors the stock list and notifies the admin when the stock goes below the specified limits. It helps them pre-order stock and thus enables them to manage sales effectively. Vendor Management Managing countless vendors now becomes easy with multiple functionalities including ‘per sale commission’, ‘revenue information’ etc. Refer to Friends Increase the customer base of your business without any efforts. This option helps your customers to refer friends, colleagues to your app and they can receive referral rewards and promo coupons.
Like it? Share it! More by this author |