UITM CAWANGAN PAHANG

KAMPUS JENGKA
FACULTY OF APPLIED SCIENCES
BACHELOR OF SCIENCE (HONS). CHEMISTRY
WITH MANAGEMENT

MKT 410
INTRODUCTION TO MARKETING
ASSIGNMENT 1: COMPARISON BETWEEN ALIBABA
AND ZALORA

Group: AS2221A
Name: Muhammad Hazwan Hamim bin Shahfar Amil (2020997085)

Date of submission: 3rd May 2020

Lecturer’s Name: Sir Mohd Zahid bin Laton
1.0 EXECUTIVE SUMMARY

Alibaba Group Holding Limited and Zalora was a two different digital marketing
company that was chosen in conducting the case study to differentiate between both
companies in many aspects. Alibaba was founded by Jack Ma with 18 other person in 1999
but Zalora was newly founded in 2012 by Berlin-based Rocket Internet. There are four
aspects of micro environment that been explained such as the companies, suppliers,
competitors and customers. From the company analysis, top management, finance, research
and development and operations had been discussed which is Alibaba able to gain US$ 242
billion through their online platforms. It also operates primarily in China. For Zalora,
estimated revenue was $767.7 million and headquarters that operated in Singapore.
Suppliers, competitors and customers also the aspect which is important in every big
companies. Alibaba had explored customers markets, business markets, reseller markets,
government markets and international markets compared with Zalora which are same as
Alibaba except for government markets. Besides that, comparison of both digital companies
also focusing on 4 P’s strategy which is product, price, place and promotion. In product
strategy, Alibaba had various types of product including many sectors such as sports, film,
online shopping platform, maps and others but Zalora only consists of trendy fashions online
shopping platform and retail stores. For Price and place, Alibaba pricing strategy was
penetration pricing which cause it more marketable to people and 80% mostly in China but
for Zalora, the pricing strategy was premium pricing strategy which focusing on branded
brands mostly in South East Asian countries. Last but not least, for promotion strategy, both
of the companies practicing both online and offline method which was applicable to other
companies as well. Alibaba is more efficient than Zalora in many aspects in marketing mix
but Zalora really needed to upgrade some of their aspects to gain more people to their
platforms.
2.0 INTRODUCTION

In this individual assignment, we conduct a meta-study about the comparison between

two digital marketing companies in their 4p’s perspectives which is product, price, promotion
and place. Two digital marketing company that been chosen was famous to all people
nowadays which is Zalora and Alibaba Group Holding Limited.

Alibaba Group Holding Limited is an e-commerce platform established by 18

individuals headed by Jack Ma in 1999. He was an ex-English educator from Hangzhou,
China and aimed to give assistance in order to make the internet reachable, reliable and useful
for one and all. Alibaba Group is a cluster of businesses which are solely based on internet.
Their goal is to give a simple path to purchase and sell globally. Currently, Alibaba Group
has above 20,000 workers worldwide and has above 70 workplace in Greater China, India
and United States.

Zalora is an e-commerce website founded in the year 2012 by Rocket Internet in

various South East Asian countries such as Indonesia, Malaysia, Singapore, Hong Kong,
Brunei, Vietnam and the Phillippines. The company is now expanding, and recently it got
launched in two countries, Australia and New Zealand. The headquarters of this company is
in Singapore. This website offers a range of over 6,000 local and international brands of
apparel, footwear, accessories and recently it launched the segment of beauty products too. It
offers the latest trends in fashion to the young target market of the South Asian Countries.
Zalora mainly focused on quality over quantity. It has a proper strategy team that carefully
selects content products and limited styles product.
3.0 COMPANY MICRO ENVIRONMENT

MICRO ALIBABA ZALORA

ENVIRONMENT
 Founded in 1999 by 18  Founded in 2012 by
1) THE COMPANY people led by Jack Ma Berlin-based Rocket
 Alibaba processed 11.3 Internet
billion orders worth  Growing to account for
US$248 billion through 15 percent of Southeast
its main platforms, Asia’s 50 billion euro
Taobao and Tmall. fashion market
 Revenues of US$ 7.8  Zalora estimated annual
billion in 2013 revenue was $767.7 M
represented 3% of cost of  Has a proper strategy
goods sold team that carefully
 Operates primarily in selects content products
China and limited styles
 Research and product
development expenses  Headquarters of this
for the quarter ending company is in
December 31, 2019 were Singapore
$1.591B

 Alibaba Group most  Asian customer

2) SUPPLIERS influenced by the looking for fast
interaction of customer- fashion at affordable
suppliers prices so our
 Alibaba Group attract advantage was we
great number of suppliers were located in the
and producers who can sourcing hub
provide diverse business  Suppliers don’t have to
solution that create ship to Europe from
greater value-added for China and then back to
buyer Asia
 Bring on its platform a
great number of cost-
effective rather than cost-
push producers
 eBay Inc - connects  Lazada - Company
3) COMPETITORS diverse and passionate developing an online
community of individual shopping and selling
buyers as well as sellers marketplace
 Paypal, Inc. -safer, easier  iPrice - Online
way to conduct any shopping communities
financial transactions that enables consumers
to access a wide range
of both products and
discounts
 Filling Pieces -
Footwear label

 Consumer Markets-  Consumer Markets -

4) CUSTOMERS Provides business to business to customer
 business, business to  Business Markets -
customer and customer Marketplace platform
to customer services via  Reseller Markets -
web portals Offers people to
 Business Market - become retailers,
‘Collective wholesalers and
Entrepreneurship’ distributors to resell
between company and the platform products
thousands of merchants  International Markets -
 Reseller Markets - South East Asian
Wholesaler Market countries such as
breaks down the industry Indonesia, Malaysia,
trends Singapore, Hong
 Government Markets - Kong, Brunei,
China’s top technology Vietnam and
hub dispatching officials Phillippines
to 100 local corporations
working in the hubs
 International Markets -
made a foray into the US
market with an IPO

4.0 COMPARISON BETWEEN ALIBABA AND ZALORA

DIFFERENCE/CO ALIBABA ZALORA
MPARISON
 Alibaba.com - Largest  Shoes
1) PRODUCT B2B (Business to
 Clothing
business) platform for
small enterprises  Accessories

 Aliexpress - Online retail  Bags

store for buying products
 Sports
 Autonavi - maps and
navigation in China  Beauty
 Taobao - Largest C2C
 Muslim Wear ( depends
(Consumer to consumer)
online shopping platform on geographical

which offers commission behaviour)

free transaction
 New in
 Juhuasuan - Group
shopping platform which
offers flash sales
 Alipay - Platform for
online payments without
any transaction fees
 Alibaba Pictures - Film
company
 Alisports - Services for
sports platform
 Alihealth - Pharmaceutical
e-commerce platform

 Pricing Strategy -  Pricing Strategy -

2) PRICE Penetration Pricing Premium Pricing
(seeks to enter newer Strategy (focuses on
markets) trendy fashion items)
 Offers discounts and  Decided according to
cash backsto the market condition and
customers customer behaviour.
 Reduces its cut from  Cost of product
the transactions decided according to
 Some of services competitors too
does not involve  Total price depends
transaction cost and on the form where the
registration fees such customers ordering
as Aliexpress the item and takes
 Primary revenue - delivery charges
earned by  Offer discount on off-
advertisement that season sales
was done on their site  Price depending on
business customer behaviour in
 Secondary revenue - South Asian
Customers who take Countries
memberships
 Economical

 Internet is used by  Offers best “touch and

3) PLACE Alibaba and services dry” experience through
 was on online and an extensive 30-day
distributed through return policy, a logistics
online. infrastructure, a modern
 80% e-commerce in phone application, and a
China happens on Fit Visualizer-enabled
Alibaba Website
 Made a foray into the  Present in various South
US market with an East Asian countries such
IPO Which is the as Indonesia, Malaysia,
bigges in history. Singapore, Hong Kong,
 Orders can be placed Brunei, Vietnam and the
in a bulk as it has Philippines.
many manufcturers  Placing of products on
list and will be the website as well as in
shipped India, mobile application is way
Pakistan or Czech too balanced.
Republic to the place  Focuses on new trendy
where they ordered fashion clothes which
 Payment can be done need the supply chain
through Alipay or management like ‘Zara’
Western Union  Warehousing and
logistics have all been
built up region wise in
every south Asian
country Zalora is present.

 Promotes through  Focuses both online

4) PROMOTION number of channels and offline
  Traditional channels - promotions
print media, radio and  Online - newspaper
TV advertisements advertising,
 Catchy taglines magazine article
 Digital media advertisements, TV

 Sponsors traditional Ads

events - Beijing  Word of mouth

Olympics publicity speaks

 Sponsored Australia- when any of its new

China Business Week product is launched

 Promotes through  Digital platforms -

offers, discounts, Youtube ads,

festive sales and Facebook page, e-

cashbacks for commerce site and

purchase on its e- others

commerce platforms.

5.0 RECOMMENDATION
 From the comparison that above, in my opinion Alibaba is more efficient in all
aspects of marketing mix which was more expert in poduct, price, place and promotion
compared to Zalora. From product aspect, there are many services that had been provided by
Alibaba Group Holding Limited which consists of maps and navigations, clothes, shopping
platform, sports, online payments and pharmaceutical compared to Zalora which is only
focusing on different types of branded clothes under many categories such as Muslim wear,
shoes, casual clothes and others. From this comparison, Alibaba are more open to worldwide
users and can easily attracted many new users to continue using their platform due to many
product that been offered by this platform as it easy to used.

Secondly, from the price strategy, Alibaba using penetration pricing method which
causing people attracted to buy more product to them due to cheaper and affordable to
everyone who wanted to buy in this platform. It has no registration fee and low cost due to
many flash sales that been done. It was more economical compared to Zalora which is
practicing premium pricing strategy due to their offering international brands and pricing
strategy dependent upon the consumer behaviours. Alibaba is more better than Zalora in
pricing strategy which is focusing on economical pricing which causing all people to easily
buying their products.

Next, from the place strategy, Alibaba is not very effective due to only present mostly
in China which represents 80%. But Alibaba is not very exposed to other country compared
to Zalora which is consists of “touch-and-try” which presents in various South East Asian
countries such as Indonesia, Malaysia, Singapore, Hong Kong, Brunei, Vietnam and
Philippines. Zalora is more exposed to other compared to Alibaba which mostly in China.

For the promotion, Alibaba has various medium of promotions which is traditional
and modern. For traditional methods, they used print media, radio and TV channels which
can attract old peoples which does not used smartphones as medium of everything same as
Zalora. This can increase their sales due to the catchy taglines. But for Alibaba, it also
sponsors international events such as Beijing Olympics which make other people realised
their branding and increasing the user of their platform compared to Zalora which does not
sponsored international events that can be a positive factor to gain many profit.

6.0 REFERENCES

Alibaba Group. (2015). Leadership. Retrieved from Alibaba Group:

https://www.alibabagroup.com/en/about/leadership

Anand, V. (2015). Case study analysis of Alibaba.com. Retrieved from,

https://www.slideshare.net//mobile/VIVEKANAND88/case-study-analysi-sof-
alibabacom

Balaba, J. (2016). External and internal environment analysis of the Alibaba Group Holding
Ltd. Retrieved from,
https://www.researchgate.net/publication/296696854_External_and_Internal_Environ
ment_Analysis_of_the_Alibaba_Group_Holding_Ltd

Macrotrends. (2019). Alibaba research and development expenses 2011-2019. Retrieved

from, https://www.macrotrends.net/stocks/charts/BABA/alibaba/research-
development-expenses

Owler. (2019). Zalora’s competitors, revenue, number of employees, funding and

acquisitions. Retrieved from Owler: https://www.owler.com/company/zalora

UK Essays. (2016). Market analysis and strategy for Alibab. Retrieved from UK Essay:
https://www.ukessays.com/essays/marketing/market-analysis-and-strategy-for-
alibaba--marketing-essay.php.