Despite Amazon’s Meteoric Rise, Alibaba and JD Won’t Be Pushovers

Despite Amazon’s Meteoric Rise, Alibaba and JD Won’t Be Pushovers

Amazon has seen its value increase significantly in recent years. Whether you just read another article detailing their next move or acquisition, or just had something from the marketplace delivered to your doorstep, Amazon is engraining itself in our daily lives. Yet, to most observers this dramatic rise is still nothing short of mind-boggling.

We Get it Amazon, You’re Great

A CNBC report in February 2018 alleged that Amazon now has a market capitalization of $702.5 billion, with its shares closing at $1,451.05 on Valentine’s day. This was enough for the burgeoning e-commerce and cloud computing giant to eclipse Microsoft for the first time. This feat earned Amazon a seat at the high table with some of the leading public companies, as it takes it to third place behind only Apple and Alphabet. At the close of trading, Microsoft’s market value was worth $699.2 billion.

Forbes.com has linked Amazon’s success to many factors. One of these is that the company offers clients unforgettable online shopping experience, which keeps them coming back. The fact that the platform serves as the go-to marketplace for product searches is also believed to be one of the key reasons for its continued growth, among others.

China, Not Impressed

Despite Amazon’s growth, it appears that Alibaba and JD are unfazed by it. In fact, Investors.com reported that Alibaba and JD continue to have the upper hand in the Chinese e-commerce market.  An analyst with Stifel, Scott Devitt, who covers JD.com, revealed that the company’s shares increased 5.8 % to close at 40.80 in December 2017. But, JD’s performances aren’t just in numbers. Currently, the company is the second largest electronic commerce firm in China in terms of total sales dollar value for merchandise sold online.

For Devitt, Alibaba and JD’s ascent in the online marketplace in China is because they “are both well-managed and well-positioned. The two leaders have effectively shut Amazon out of the e-commerce market in the region,” Devitt believes. But, of the two leading companies, it seems Devitt is more impressed with JD, as he added, “JD.com is the more structured player with controlled logistics.” Devitt’s claims are justified if you consider that JD has been the busiest of the top two Chinese businesses in recent times. The company, along with its partner, Tencent Holdings, had broadened its operation in October 2017 by setting up a retail marketing platform.

JD On the Up

The organization is also in collaboration with Wal-Mart, whom it bought a Chinese e-commerce business from in 2016. The deal meant that Wal-Mart now owns a percentage of JD.com. Devitt also believes that for all of the success that they have achieved, this is only the beginning of good times ahead for the China-based e-commerce giants. In his word, “We expect the primary drivers of the China e-commerce market to be improving delivery and payment capabilities, further expansion to rural markets, and a less-developed traditional retail landscape.”

So, it seems that the Chinese e-commerce market is the proverbial nut that Jeff Bezos and Co. cannot crack. But, despite this, there’s no doubt we will see share increases for all parties in their respective markets. In the end, there’s plenty of room Amazon, Alibaba and JD to play.


Author:  Christine Duff

Christine wants to live in a world filled with cutting edge fashion, beautiful words and and an endless supply of leather jackets and boots. A product development grad of FIDM, she was the Editor-in-Chief of MODE Magazine where she reignited her love of storytelling. She has diverse experience within the industry with trend research, art direction and styling editorial spreads. She gained her most notable experience working in Los Angeles at the satellite operation for GQ and Vogue Thailand. Christine is passionate about social science and the role it plays in the consumer goods industry and apparel in particular.


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