A few days ago, while I was pondering about what to write for my first blog entry, I came across an article about online shopping in my Chinese textbook. Luckily, today in class we discussed the text in depth, focusing on the rapidly growing online shopping market in China. One particular store we focused on was Taobao, a Chinese website which facilitates business-to-consumer and consumer-to-consumer retail by providing a platform for businesses and individual. Sellers are able to post new and used goods for sale on the website, and buyers are able to bargain with the seller using instant messaging tools.
Conventionally, social trend helps businesses generate sales, such as the case for car companies making profits for “going green”. However, that’s not the case for Taobao. Taobao created the social trend of online shopping,; in 2009, one out of every three Chinese Internet users was shopping online. Consequently, online retail sales increased 117 percent annually between 2007 and 2009, of which close to 89% of sales increase was generated by Taobao.
Taobao was able to successfully capture loyal customers and attract new ones because they successfully implemented the 4Ps.
Product :Taobao currently hosts 800 million product listings, giving customers a variety of products to choose from. After purchase, customers post comments on the sellers’ page, which becomes valuable information for new customers who might inquire product size or texture.
Place: In order to achieve 100% customer satisfaction rate, sellers deliver products in less than 3 days.
For Promotion, Taobao now sells for itself. It has a largely customer oriented system; such as payment made after confirmation of product, and $0 return shipping fee. Moreover, the opportunity to connect with 370 million registered users in the Taobao community is what makes Taobao as successful as it is.
