It is interesting to study the path of some major e-commerce companies, such as eBay and Amazon in Asia. Back in the early 1990s, eBay entered the Chinese market and soon found themselves been slaughtered by another local Chinese company, Taobao (also known as “treasure hunting” in Chinese). One of the major reasons of its falls is because of the listing fees it charges to customers. Clearly, the Chinese online market at the time was not mature enough to accept customer service fee and it was more important to nurture the market than to charge listing fees. Taobao, on the other hand, understood the situation and started its advertising campaign among young college students who are the main drivers of online shopping. It focused more on building a shopping community by posting articles and offering discounts on popular online forums.
I could not help but wonder what is the appropriate marketing strategy for e-commerce. Although e-commerce center around the concept of promoting a no-boundary shopping experience, it could not afford to ignore the local culture and market. To some extent, e-commerce demands more interactions among buyers and sellers than the traditional retail business.
2 comments:
In a similar vein to how e-commerce differs across cultures, I wonder how e-commerce differs across generations. In another class, we are developing a product/service for the 60+ market. Because we are targeting affluent urban shoppers, e-commerce is what we hypothesize to be the major channel for both customer acquisition and sales. However, the current Baby Boomer generation learned the Internet, for the most part, on the job as professionals and not as young students. Therefore, where does e-commerce fit in the lives of this generation? What types of websites, content, frequency of updates, advertising, etc. appeal to this generation of internet users? I would be extremely interested in any opinions regarding the right online locations, formatting, and content for the Baby Boomer generation. How do we message effectively but gracefully?
Taobao is a success in China with a C2C + B2C business model of E-Commence. It beats eBay in China. Alibaba’s Jack said “eBay may be a shark in the ocean, but I am a crocodile in the Yangtze River. If we fight in the ocean, we lose—but if we fight in the river, we win.”
I think Adaptation is crucial as a marketing strategy for every E-commence. Taobao knows the local market and the Chinese consumer behavior. It developed the user platform, the transaction system, marketing programs which exactly meet needs of Chinese consumers, while Ebay did not adapt its E-Commence to Chinese culture; instead, it still used a common US-based Ebay Platform for China Market, which leads to the failure.
No doubts that E-Commence can sale products online to people all around the world, but I believe adaptation is one of the top things a company has to concern if it wants to success in a new market, especially in the emerging markets.
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