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Taobao – a Short Story

Taobao.Com

On May 10, 2003, a group of companies by the name of the Alibaba Group, got together and created a Chinese online shopping site referred to as the Taobao Marketplace (www.taobao.com). This is a marketplace that is quite similar to Amazon.com, eBay.com, or even Buy.com. However, the major difference between this site and many of the others that are based in the United States is, that this site specifically caters to entrepreneurs and small business owners in mainland China, Taiwan, Macau, and Hong Kong.

In the following paragraphs, you’re going to discover a bit more about the history of Taobao.Com, as well as the initial development, foundation and business activities associated with this Chinese online shopping center.

A Short Overview

The Chinese Biggest Marketplace

In May of 2003, the Alibaba Group launched their new company, the Taobao Marketplace, originally named Taobao, as a response to a move by eBay, a major US auction site – to acquire a company by the name of Eachnet for a little over $175 million. Eachnet was actually the number #1 auction site in China at the time. As a result of the acquisition, this gave eBay the leverage it needed in order to become a major player in the eCommerce Chinese consumer market – or so they thought.

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A Unique Foundation

Once launched, unlike eBay – the Taobao Marketplace decided to provide a unique offering to small business owners and entrepreneurs. They immediately offered a variety of different options which included free listings, a number of website features, and instant messaging to bring new business in order to push eBay out. They created a unique escrow-based payment system which also included, Alipay. As a result of their unique efforts, the Taobao Marketplace became the undisputed leader within two years in the Chinese marketplace, and eBay was eventually pushed out of the market in 2006.

Business Activities and Development

To complement the C2C Taobao Marketplace in 2008, the Alibaba Group decided to introduce a dedicated and unique B2C platform which they referred to as the Taobao Mall. Unbeknownst to many, this development would take Taobao to levels never before imagined. Quite frankly, the Taobao Mall is considered to be the ideal destination for top brands, goods, and quality for all the different Chinese consumers. As an additional offering, there were additional activities that had taken place as well such as a new launch of an independent domain by the name of Tmall.Com. This offering refined the general focus on product improvements and verticals as well as the overall shopping experience by 2010. As a result of the success of Tmall.Com, it became totally independent and had changed its name to Tian Mao.

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Although there have been additional launches, tweaks, and infrastructure changes, in mid-June 2011, it was revealed by Alibaba’s head CEO and chairman Jack Ma, that the company known as Taobao would split up into three separate companies, Taobao Marketplace, Tmall.Com, and Tao. Although all three companies were already under the Taobao umbrella, they would be separated into individual companies operating on their own. This move was said to be a result of competitive threats which have become apparent in the last several years as a result of the dramatic change in the e-commerce and Internet landscape.

As a result of this decision, it has made Taobao.Com one of the largest e-commerce companies in the Asian continent.

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