Alibaba Continues to Succeed Amid Tight Competition

Category: Business


Unlocking Word Meanings

Read the following words/expressions found in today’s article.

  1. surge / sɜrdʒ / (v) – to increase or rise

    The number of people who shop online surges every Christmas season.

  2. square off / skwɛər ɔf / (phrasal) – to prepare to compete with

    Making huge investments to square off against your competitor is a great risk.

  3. wholesale / ˈhoʊlˌseɪl / (adj) – relating to the sale of products in large quantities

    Wholesale prices are much cheaper than retail prices.

  4. take a page from (someone’s) book / teɪk ə peɪdʒ frʌm bʊk / (idiom) – to copy

    He is taking a page from his brother’s book; he is beginning to speak like him.

  5. middle class / ˈmɪd lˈklæs / (n) – the group of people between the upper class or the very rich and the lower class or the very poor

    I consider myself part of the middle class.


Read the text below.

Alibaba’s sales continue to rise this year, while rival Walmart has experienced a drop in revenue.

The Chinese retail company’s net income surged by 94% compared to last year’s earnings. Meanwhile, Walmart’s income dropped by 23% this year. Alibaba investors also continue to be optimistic, as the company’s shares increased by 5% due to its performance.

Walmart is reportedly performing well this year but is losing income because it is squaring off against Amazon. Currently, Amazon is one of the world’s top online retailers. To compete with Amazon, Walmart is expanding beyond the wholesale and retail industry and starting to invest in e-commerce.

In the midst of the tight competition in the industry, Alibaba is also finding ways to become even stronger. It has taken a page from Amazon’s book and is now diversifying its business.

Alibaba is operating on a “new retail” concept, which integrates online and offline business models. Currently, Alibaba owns e-commerce, digital media, and entertainment sites. It also bid for a Chinese department store chain that has physical stores all over China.

In addition, Alibaba invested in other big e-commerce platforms, Lazada and Tokopedia. Lazada has been number one in Southeast Asia for quite some time, while Tokopedia is one of Indonesia’s largest online stores. Both are now under the Alibaba Group.

Alibaba’s success reflects a global shift from offline to online shopping. It shows how well Asia is responding to e-commerce. Reports say that the success of the e-marketplace in Asia is due to faster Internet speeds and the growth of the region’s middle class.

Viewpoint Discussion

Enjoy a discussion with your tutor.

Discussion A

• Do you think that Walmart’s losses due to their investments will be worth it in the end? Why or why not?
• What else can Walmart do to keep up with its competitors? Discuss.

Discussion B

• Compare the pros and cons of online businesses and offline businesses.
• What are the limitations of a business that greatly depends on the Internet? Discuss.