Business Strategy Evaluation & Recommendations

1. Business Strategy Evaluation & Recommendations • EVALUATE BUSINESS STRATEGY • Internal Assessments Evaluation : • Bridge of Business-To-Customer • Information Technology • Information Flow, Capital Flow and Logistics Development • Mechanisms Development • Significance of Alipay(支付宝 ) • External Assessments Evaluation : • Huge Market Potential of Online Shopping • Social Environment • Trading Platform Environment

2. Business Strategy Evaluation & Recommendations • EVALUATE BUSINESS STRATEGY • Internal Assessments Evaluation : • Bridge of Business-To-Customer • Provide:sets business portals, search engines, shopping platform payment whole range of hassle-free services • Result: Ensures transaction security Safeguards legitimate rights and interests for both parties.

3. Business Strategy Evaluation & Recommendations • EVALUATE BUSINESS STRATEGY • Internal Assessments Evaluation : • Information Technology • >Interaction design of information system • Interface of Yahoo More suitable JavaScript UI effects and tools • Chinese Web Application • Result: • Advocates the lively and efficient network transactions culture • Creating a more secure and efficient trading

4. Strong local culture that reflected a deep understanding of Chinese consumers and an attitude of informality. Chinese customers want their sites to be noisy, with lots of links

5. Business Strategy Evaluation & Recommendations • EVALUATE BUSINESS STRATEGY • Internal Assessments Evaluation : • Information Flow, Capital Flow and Logistics DevelopmentInformation Flow: Integrates B2C and C2C e-commerce • Provide effective real-time information services • Capital Flow: Uses the tool of “Alipay” (支付宝 ) • Logistics Development: Cooperation & recommending third-party logistics companies • Provides logistics information services for customers • Result: Provide effective real-time information services • Resolve the issue of network payment • Development digital certificates • Ensures the capital security, • Information security, • Cargo security, Trade secrets in online transactions

6. Business Strategy Evaluation & Recommendations • EVALUATE BUSINESS STRATEGY • Internal Assessments Evaluation : • Mechanisms Development • Register need to using national identity card and bank account • Allowed buyers and vendors provide feedback • Distinguished between seller and buyer • (eBay provided only one score for each user.) • Introduced Alipay (支付宝, “payment treasure”), • Result: Create Confident for both seller and buyer

7. Business Strategy Evaluation & Recommendations • EVALUATE BUSINESS STRATEGY • Internal Assessments Evaluation : • Significance of Alipay(支付宝 ) • Critical to Taobao’s development • Even buyers see a seller with high ratings, lack of trust still Creates a big challenge • Banks cannot address the settlement risk. • Free of charge by using Alipay • Result: Eliminates the settlement risk. • More than 80% of Taobao transactions rely on Alipay. • On eBay, there were many buyers who complained that • They did not receive their items.

8. Business Strategy Evaluation & Recommendations • EVALUATE BUSINESS STRATEGY External Assessments Evaluation : Huge Market Potential of Online Shopping Online Shopping Environment: 17.9% Internet users in China have the online shopping experience 29.6% of them have their online shopping experience More than 90% of respondents will continue the shopping These data indicated that China's huge market potential of online shopping. Market Leader: More than 62 million registered members Number of registered members of Alipay is more than 63 million Occupied more than 70% of market share in China, More than 80% market share of C2C First choice for Chinese netizens starting a business online

9. Business Strategy Evaluation & Recommendations • EVALUATE BUSINESS STRATEGY • External Assessments Evaluation : • Social Environment • Taobao - under the social and national macro background of China's political stability and steady economic development. • China‘s network infrastructure continuously improved, rising the number of netizens(網民) • Chinese Government actively supports e-commerce • Provides good environment for the development of e-commerce. • Enacted a Series of relevant policies, laws, regulations, etc. • Promote and facilitate e-commerce applications and security system

10. Business Strategy Evaluation & Recommendations • EVALUATE BUSINESS STRATEGY External Assessments Evaluation : Trading Platform Environment Undertrading platform, Seller initiatively sales or auction for goods Buyer choose goods to bid and purchase Instant-messaging service, WangwangProvide continuous feedbackAsk for assistanceMake suggestions BargainingBidding process can save a lot of market communication costs. As a result, communication problems” constituted only 8% of Taobao’s non-positive feedback.