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Socially-driven E-commerce Drives Alibaba’s Taoxiaopu Online
COVID-19 and China
Girls who are shareing products online. Photo: Credit to Taoxiaopu website

Alibaba unveiled its first social-driven e-commerce platform Taoxiaopu (淘小铺) on May 22 after an intense period of preparations. Based on Alibaba's ecological, Taoxiaopu will operate on the existing Taobao consumer community. By integrating the high-quality supply chain such as Tmall brand, ordinary consumers can become Taoxiaopu shopkeepers, share their own selected goods and profit from it if anyone purchases their shared goods.

In recent years, the traditional e-commerce giants like Taobao and JD.com have experienced the slowdown of the increase rate of its users, the cost of acquiring customers keeps increasing while the traffic bonus from first and second-tier cities are going down as well.

However, Internet popularization and consumption upgrading have brought customers from low tier cities from offline to online. Both users increase rate and penetration show a promising market.

Under this background, social-driven companies are founded. The advantages of social e-commerce are that it can shorten the supply chain, realize the explosive growth of users through fission, and open the blue-sea market of low-tier-cities users. Pinduoduo (拼多多)represents the group shopping mode, Beidian (贝店), and Yunji (云集) are in the way of exploring the S2B2C mode, Xiaohongshu (小红书) and Baobaoshu are community-based modes.

Alibaba saw the market potential of social e-commerce. Even before Yunji listed on Nasdaq and Beidian completed its new round of fundraising, Taoxiaopu had been tested internally for market trend research and merchant feedback in April.

Positioned as a socialized marketplace for everyone, Taoxiaopu improves upon conventional retail models with its S2B2C (supply to business to customer model) in which a data-driven supply chain platform is closely linked to the businesses that serve customers, offering features such as real-time feedback and customization for small businesses.

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