Compression between Alibaba, Amazon, SAP Ariba and Souq

Alibaba sells ads; Amazon sells stuff and SAPAribasells services.

1-Alibaba.com makes money by receiving a commission on each transaction as well as by charging subscription fees to
sellers who maintain storefronts in the marketplace.

How does Alibaba makes money?

Online marketing services. These consist of the following:

P4P, or pay-for-performance, marketing services. Here, sellers bid for keywords that match product or service listings
appearing in search or browser results on a cost-per-click (CPC) basis at the prices established by Alibaba online auction
.system

Display marketing services. Here, sellers bid for display positions on the relevant marketplaces or through their third-party
marketing affiliates at fixed prices or prices established by their real-time bidding system on a cost-per-thousand impression
.(CPM) basis

Taobaoke program. Here, sellers on Taobao marketplace and Tmall pay commissions to Alibaba based on a percentage of
GMV for transactions settled through Alipay from users sourced from third-party marketing affiliates. Commissions on
Taobaoke are set by the sellers and depend on the amount the seller is willing to pay to generate incremental sales through
.the affiliate channel

Placement services. Here, sellers pay placement fees to purchase promotional lots on the Juhuasuan marketplace for a
specified period.

Commission on transactions. In addition to purchasing online marketing services, sellers on Tmall and Juhuasuan also pay a
commission based on a percentage of GMV for transactions settled through Alipay in the respective marketplaces. Alibaba
.also generates revenues from commissions on transactions over AliExpress

Storefront fees. This is comprised on monthly subscription fees for Wangpu, Alibabas storefront software that includes a
.suite of tools that assist sellers in upgrading, decorating, and managing their storefronts

Membership fees and value added services. Revenue from 1688.com is primarily generated from the sale of China TrustPass
memberships, which allow wholesalers to host premium storefronts, with access to basic data analytic applications and
upgraded storefront management tools. Alibaba also offers them value-added services, such as premium data analytics.
Revenue from Alibaba.com is primarily generated from the sale of gold supplier memberships on Alibaba.com, which allow
wholesalers to host premium storefronts. Alibaba also offers them value-added services such as product showcase, custom
clearance, value-added tax, or VAT, refund and other import/export business solutions.
 Compression between Alibaba, Amazon, SAP Ariba and Souq

2- Amazon. Amazon sold books. Online. Ta-da! That was the jist of things. And then it expanded into other product
categories. The overall goal was to be a convenience shopping serviceyou could go on Amazon and find that hard-to-locate
book or lamp or whathaveyou, and have it shipped to your doorstep. But as more retailers like Target and Wal-Mart began to
move into the e-commerce space to keep up with changing shopping habits, Amazons convenience angle morphed into a
cheaper angle.

Because Amazon is selling non-exclusive items, the only way to differentiate from competitors was to slash prices. So began
the Great Show rooming Controversy, in which Amazon began encouraging customers to check out products in brick-and-
mortar stores (like Target and Wal-Mart) and then hunt them out on Amazon for a price comparison. Amazon even released
its price comparison app Price Check in 2010 for that very reason. Sick of being used as showrooms, Target and Wal-Mart
subsequently kicked all Kindles and Kindle products out of their stores.

But taking the same bauble sold on millions of other e-commerce sites and offering it for less does not a winning strategy for
high profit margins make. Sure, it helps with gaining market share, but how long will Amazon be able to keep that up?
Amazons after-tax margin currently stands at a puny 1%--where it used to be 6.6% in 2004. But Bezos and company didnt
build Amazon into what it is today by being stupid. Its likely that the company has a larger strategy in mind.
 Compression between Alibaba, Amazon, SAP Ariba and Souq

How does Amazon makes money?

For now, lets look at how Amazon IS making money. Lets start with Amazons basic retail business .

General RetailAmazons net sales (all sales including AWS and commission from third party sellers) totaled $61.1 billion,
accounting for 7% of the entire $900 billion global e-commerce market. The companys retail sales totaled $51.7 billion,
which is the equivalent of the sales of the next six non-auction based retail sites combined. Amazons Electronic and General
Merchandise division accounted for $38.6 billion in 2012, a 35% increase over 2011.

Third Party SellersAmazon doesnt reveal how many third party sellers it has in its marketplace, but some 40% of all goods
sold on the site are via third party sellers, accounting for roughly 12% of Amazons total revenue. Amazons relationship with
third party sellers has been a rocky one, with some sellers accusing Amazon of withholding payments for longer than the
maximum holding period. Theres also the fact that some sellers find that Amazon becomes a competitor, selling the same
item for less and with free shipping to boot. But for Amazon, third party sellers present a unique market research
opportunity. Amazon can track purchases made through its marketplace, which means it can get CRM data on customers who
have never actually purchased an item from Amazon.

Amazon Web ServicesAWS doesnt account for a large share of Amazons revenues, but its still nothing to sneeze at. In the
third quarter of 2013, AWS generated $850 million in revenue, more than double that of Q3 2012. AWS is expected to
generate $1 billion in the fourth quarter, at which point it will have generated an estimated $3.2 billion for the entire year. It
doesnt seem like much in the grand scheme of things, but when you consider the fact that Amazons revenues in 1997
totaled just $147.8 million (itself, an 838% increase over the $15.7 million the company made in 1996), $3.2 billion isnt bad.

Kindle FamilyLets be clear on this one: Amazon makes no money on the Kindle Fire itself. Jeff Bezos finally admitted as much
this year, revealing that Amazon actually breaks even on each device. So whats the point? The point is that each Kindle Fire is
a content driver. Customers are more likely to buy books, magazines, and watch movies and TV shows via Amazon Instant
Video, so Amazon can afford the loss in order to undercut competitors Apple and Google. Each Kindle Fire also comes with a
free one-month Prime trial, the significance of which will be explained in a moment.

So why is content such a big deal? Because it accounts for nearly a third of Amazons revenues.
 Compression between Alibaba, Amazon, SAP Ariba and Souq
Media and ContentAmazons media revenues for 2012 were $20 billion, an increase of 12% over 2011. The division grew 15%
in North America and 10% internationally. And the segment is likely to grow this year as Amazon invests more heavily in
original content. The company has already moved into the publishing game, and now its producing its own TV shows,
including Alpha House and the newly released Betas. There are lots more on the way, too.

One big way that Amazon is driving more content purchases is through its Prime subscription program.

PrimeEach Kindle Fire comes with a free one-month Prime subscription, which means newbies get a chance to experience the
awesome sauce of free two-day shipping and a wide array of free movies and TV shows, including Amazons original
programming (Alpha House and Betas, to start with). Once users get a taste of Prime, they realize that the sticker price of
$79 a year is well worth it.

3-SAP Ariba.SAP Ariba is an online solution catered to delivering a cloud-based procurement platform for the needs of
both buyers and suppliers. It is touted as one of the worlds leading business commerce networks where businesses of all
sizes can connect to their trading partners anywhere, at any time, and from any application or device to buy, sell, and
manage their cash more efficiently than before.

SAP Ariba combines industry-leading cloud-based applications with the worlds largest Internet-based trading community to
help companies discover and collaborate with a global network of partners. Companies around the world use the software to
simplify inter-enterprise commerce and enhance the results that they deliver.

Overview of SAP Ariba Benefits

SAP Ariba provides cloud-based solutions to make it easier for businesses to collaborate and compete. Installation requires
no costly hardware or software, and no upgrades are expected on the users behalf. Companies can simply access it on a
multi-tenant platform through a user-friendly interface, wherever they may be, or whatever browser they are using. It can
also be integrated to any existing ERP or back-office system as it extends their functionality, and allows users to share
processes and collaborate with trading partners towards more competitive business commerce.

SAP Ariba offers spend management solutions and expertise that reveals everything about a companys spending habits and
uses that knowledge to help users negotiate better deals. Users are also connected to a diverse network of high-quality
 Compression between Alibaba, Amazon, SAP Ariba and Souq
suppliers who can lower costs for goods and services while minimizing risks while ensuring compliance. There is also the
financial chain management which utilizes new capabilities, intelligence, and global reach to transform liabilities into strategic
assets.

With SAP Ariba, users now have a simple, smart, and open way to connect all systems and stakeholders through the powerful
global Ariba Network. Being part of this network enables users to reduce costs, mitigate risks, and get products to the market
thanks to comprehensive solutions such as the integration of sourcing and product design teams, item cost tracking, contract
compliance enhancement, supply availability tracking and assessment, and reduction of excess inventory, among many
others.

Overview of SAP Ariba Features

Supply chain collaboration
 Compression between Alibaba, Amazon, SAP Ariba and Souq
Strategic sourcing
Procurement
Contract management
Spend analysis
Supplier management
Financial supply chain management
Invoice management
Dynamic discounting
Payments
Supplier discovery
Strategic sourcing
Ariba Exchange

How Much Does SAP Ariba Cost?

SAP Ariba Pricing Plans For Enterprises & Small Business:
SAP Ariba has the same flexible pricing scheme typical for SAP products, meaning that each client receives a separate
SMB/enterprise pricing plan tailored to his needs. Contact the company for more details, and ask for your quote.
 Compression between Alibaba, Amazon, SAP Ariba and Souq

- Compare between Alibaba, Amazon and SAP Ariba membership fees:

Service fees / membership fees

1- Alibaba
Gold Supplier membership starts around $5,000/yr but the sales contacts will also look for up sell and cross-sell
opportunities to help 'get your page noticed'.

For China Members, it will cost almost $5,000/yr. For member out of china, it depends on your country.
If you are from countries outside mainland China, Hong Kong, Taiwan and Macau, the annual fee of Gold Supplier is
USD$ 2,999.
If you are from China Mainland, Hong Kong, Taiwan and Macau, the annual fee of Gold Supplier is RMB 29800.

They do charge around 10% on every sell. They use escrow account to protect buyer payment Means when buyer will
click on "yes I have race the order" after that your payment will be released in your account.

2- Amazon
To sell on Amazon would be $39.99 a month+ additional selling fees.

The average is more like 15%. There is a $1.00 fee for non-pro sellers and a $40/mo recurring fee for professional
sellers. Another non-direct cost is that Amazon gathers a large amount of data and will source the item from whatever
distributor you buy it from, and will sell it for a very low price that often pushes 3rd party sellers out of the marketplace
for that item. Although Amazon lets you sell on their site, they are also your competitor.

3- SAP Ariba
SAP Ariba has the same flexible pricing scheme typical for SAP products, meaning that each client receives a separate
SMB/enterprise pricing plan tailored to his needs. Contact the company for more details, and ask for your quote.

So it depends on the service you need not a pricing list. You ask for the service and they calculate the cost / fees.

fees per year

5000
$5,000
$4,500
$4,000
$3,500
$3,000
fees per year
$2,500
$2,000
$1,500
$1,000 487.88 Cost will be by
$500 service
$0
AliBaba Amazon SAP Ariba

Examples:
 Compression between Alibaba, Amazon, SAP Ariba and Souq
Example 1

Product Fees / Membership

Product Price Company
5000$ per year for pro (gold silver
Diamond)
131.56$ Alibaba
Or
10% on every sell
Kids Cycle
487.88 $ per year fo pro
+
139.99$ Amazon
10.00$ for non pro sellers

Example 2

Product Fees / Membership

Product Price Company
5000$ per year for pro (gold silver
Diamond)
59.99$ Alibaba
Or
Beats 10% on every sell
Headphones 487.89 $ per year for pro
Or
65.10$ Amazon
10.00$ for non pro sellers

139.99
131.56
$140.00

$120.00

$100.00

$80.00 65.1 kids cycle

59.99
Beats hedphones
$60.00

$40.00

$20.00

$0.00
Amazon Alibaba

From the 2 charts it appears that Alibaba market is better for the consumer rather than Amazon, Alibaba sells ads, and Amazon sells
stuff. And it is clear that Alibaba speared more to take the control on the market.
 Compression between Alibaba, Amazon, SAP Ariba and Souq

Alibaba.com Membership Package

Alibaba.com have two kinds of membership as below:

1, Free Membership

For Buyers

Membership is completely free for buyers on Alibaba.com. With a Free Membership you can:
Use our powerful and effective Sourcing Tools
Search Product Listings and send inquiries direct to suppliers
Post unlimited Buying Requests

For Suppliers

Companies operating outside of Mainland China can join Alibaba.com for free. With a Free Membership you can:
Use our powerful and effective selling tools
Display up to 50 products online

Companies based within Mainland China are required to join as a Gold Supplier. For more details on a Premium Gold
Supplier Membership, click here.

2, Premium Gold Supplier Membership

Gold Supplier is a premium membership for export-oriented suppliers. It provides extensive additional promotion advantages
and benefits, both online and offline. All Gold Supplier members have satisfied the necessary requirements for this highest
level of membership. They are also required to undergo rigorous authentication and verification procedure by third-party credit

reporting agencies. A Gold Supplier member is authorized to display an icon to demonstrate credibility to
buyers online.
 Compression between Alibaba, Amazon, SAP Ariba and Souq
. .
5.00
.
:

5.00 5%

(
5.00 10%
) D

5.00 20%

5.00 15%

. 7.50

% : 5 1

300.00 , 15.00 ( %5 300.00 ) . 7.50.

: 7.50

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: 2 10

. 200.00 20.00 ( 10 200.00 ) . 7.50

: 7.50

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: 3 / 50

. 50 10 ( / 50 )%20
 Compression between Alibaba, Amazon, SAP Ariba and Souq

: 0

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/ 50 50 : 4

/ 50 2000 ( )%10 10 ( 50
. )%20 200 2000 .)%10 7.5

: 7.5

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! . 100000

Diving into Noon.com
A quick look at Noon.com's expected commercial model.

Category Fees
Fashion: 12%
Electronics: 4%
Electronics Accessories: 8%
Health: 8%
Books & Music: 4%

It is expected that sellers will not be charged category fees for the first six months.
 Compression between Alibaba, Amazon, SAP Ariba and Souq
Closing Fees
AED 2 + 2% of sale value (unclear if this includes shipping costs).

Fulfilment Fees
Small Box: AED 5
Medium Box: AED 10
Oversized Box: AED 15
Bulk: AED 20

Storage Fees
AED 1.5 per cubic foot for 60 days
AED 2 per cubic foot from 60 to 80 days
AED 8 per cubic foot for 180 days+

Fees are subject to change, but have been indicated to be 90% accurate.

Fulfilment Centre
A large distribution and fulfilment centre will be based in Dubai South. Capacity is expressed to be
multiples of the largest player in the region, but it is not clear to what extent. A vendor reports that
they've been requested to supply racking that is similar to an existing large e-commerce retailer's
environment but have also been asked to provide palletised racks which indicates that bulk pallet
storage will also take place.

It is expected that fulfilment services will be provided to third parties, potentially indicating that
Noon.com may manage and fulfil for a given brand's other channels. Zara has been indicated as a
potential customer.

Seller Dashboard
Sellers are expected to have a dashboard available in the next couple of weeks.

Categories
It is expected that Noon.com will focus on branded fashion including luxury names such as Gucci and
Chanel, whilst other categories will be built alongside.

Noon Pay
An industry insider speculated that Noon Pay may look to position as a PayPal style wallet where the
Noon.com marketplace is a key channel for user acquisition and the capture of payment details. The
captive details would be subsequently used to sell through other services.

About Amazon Prime

Receive all the benefits of Amazon Prime including FREE Two-Day Shipping for eligible purchases,
unlimited streaming of movies and TV shows with Prime Video, and the ability to borrow books from the
 Compression between Alibaba, Amazon, SAP Ariba and Souq

Kindle Owners' Lending Library for $99 a year or $10.99 a month. We also offer a Prime Video
membership for $8.99 a month that only includes Prime Video as a benefit.

The benefits include:

FREE Two-Day Shipping on eligible items to addresses in the contiguous U.S. and other shipping benefits. For more
information, go to Amazon Prime Shipping Benefits.
FREE Same-Day Delivery in eligible zip codes. For more information, go to Order with Prime FREE Same-Day Delivery.
Prime Now: Get FREE two-hour delivery or scheduled delivery on over 10,000 items, from groceries to electronics and
more. Plus, get free delivery from your favorite local stores. Available in eligible zip codes only. For more information go
to Prime Now.
Amazon Restaurants: One-hour delivery from popular restaurants for Prime members in eligible ZIP codes. Learn more
at amazon.com/restaurants.
FREE Release-Date Delivery: FREE Release-Date Delivery on eligible pre-order items delivered on their release date to
ZIP codes within the continental U.S. For more information, go to Release-Date Delivery.
Prime Video: unlimited streaming of movies and TV episodes for paid or free trial members in the U.S. and Puerto
Rico. For more information, go to About Prime Video.
Prime Music: unlimited, ad-free access to hundreds of Prime Playlists and more than a million songs for members in the
U.S. and Puerto Rico. For more information, go to About Prime Music.
Prime Photos: Secure unlimited photo storage and enhanced search and organization features in Amazon Drive for you
and the members of your Family Vault. For more information, go to About Prime Photos.
Prime Pantry: Access to Prime Pantry, where members can purchase and ship to addresses in the contiguous U.S. low
priced grocery, household, and pet care items for a flat delivery fee of $5.99 for each Prime Pantry box. Prime Pantry
orders cannot be shipped to addresses in Alaska, Hawaii, and Puerto Rico.
Amazon Elements: Access to Amazon Elements products, Amazon's own line of everyday essentials.
Amazon Dash for Prime: Never run out of your favorite products with Amazon Dash Button. For more information, go
to Amazon Dash Button.
Prime Early Access: Get 30-minute early access to Lightning Deals on Amazon.com. For more information, go to About
Prime Early Access.
Kindle Owners' Lending Library: access to members in the U.S. For more information, go to Kindle Owners' Lending
Library
Prime Reading: You can borrow books, magazines, and more from the Prime Reading catalog and read them on your
Fire tablet, Kindle e-reader, or the Kindle reading apps for iOS and Android. For more information, go to Borrow Books
from Amazon Prime Reading.
Kindle First: Early access for members in the U.S. to download a new book for free every month from the Kindle First
picks. For more information, go to Kindle First.
Audible Channels for Prime: Get access to Audible Channels, a $60/year value, for free. Audible Channels includes
unlimited listening to original audio series and playlists handcrafted for every interest. Youll also receive access to Prime
Exclusive Audiobooks, a collection of streaming audiobooks including best sellers, family favorites, celebrity-narrated
classics and more. Just download the free Audible app and sign in with your Amazon account to start listening.
Amazon Music Unlimited: Prime members can get discounted Amazon Music Unlimited monthly plans and there are
annual plans available exclusively to Prime members. For more information, go to Amazon Music Unlimited.
Video Add-On Subscriptions: Members can purchase Video Add-on Subscriptions to premium content
providers. Browse available Video Add-on Subscriptions, or manage your existing subscriptions.
Deals and Discounts, Compliments of Amazon Family: These include 20% off diapers through Subscribe & Save and
15% off eligible products from your baby registry. For more information go to Get 20% off Diaper Subscriptions or About
the Completion Discount.
Twitch Prime: Members get exclusive discounts on physical games pre-orders and new releases. Twitch.tv users who
link their Amazon Prime account get ad-free viewing on Twitch, a free Twitch channel subscription every month, and
exclusive access to free game content. For more information, go to Twitch.tv.
Membership Sharing: Two adults living in the same household can create an Amazon Household to share certain
Amazon Prime benefits. For more information, go to About Amazon Households. If you have a paid Prime membership
under your personal account you can share your shipping benefits with your Amazon Business user account. Go
to Amazon Prime and Business Accounts.
 Compression between Alibaba, Amazon, SAP Ariba and Souq

Get your business in front of the right buyers at the right time

SAP Ariba puts your business in front of profitable customers who are ready to buy. When you connect to Ariba Network,
you quickly connect to a global network of millions of companies. You can efficiently scale existing customer
relationships, plus discover and win new business.

You can collaborate with your customers on everything from RFIs and bids to managing catalogs and orders all through
easy-to-use tools and mobile apps. Youre part of a dynamic, digital marketplace, where you can effectively track and
manage the sales cycle from beginning to end, accurately predict cash flow, increase revenue, and grow your business.

SAP Ariba provides cloud-based solutions to make it easier for businesses to collaborate and compete. Installation requires
no costly hardware or software, and no upgrades are expected on the users behalf. Companies can simply access it on a
multi-tenant platform through a user-friendly interface, wherever they may be, or whatever browser they are using. It can
also be integrated to any existing ERP or back-office system as it extends their functionality, and allows users to share
processes and collaborate with trading partners towards more competitive business commerce.

SAP Ariba offers spend management solutions and expertise that reveals everything about a companys spending habits and
uses that knowledge to help users negotiate better deals. Users are also connected to a diverse network of high-quality
suppliers who can lower costs for goods and services while minimizing risks while ensuring compliance. There is also the
financial chain management which utilizes new capabilities, intelligence, and global reach to transform liabilities into strategic
assets.