February 22, 2011
By the ZippyCart Content Team

Alibaba.com Ltd., China’s largest ecommerce site, announced early Monday that Chief Executive David Wei and Chief Operating Officer Elvis Lee had resigned, after an internal investigation found more than 2,300 sellers on its virtual storefronts committed fraud and some 100 of the company’s sales staff were involved. Alibaba released a statement explaining its longtime chief executive, David Wei, and chief operating officer, Elvis Lee, had not been involved in any fraudulent activities but that they had resigned after accepting responsibility for the company’s “systemic breakdown.”

The resignation comes as a bit of a shock to Alibaba.com’s parent company, the Alibaba Group, who saw Wei as an integral part of its long term strategy and a valued leader. The company has confidently named Jonathan Lu to replace Wei as chief executive. Lu will also maintain his position as chief executive of Alibaba’s sister retail company Taobao.com.

Alibaba said it launched a full fraud investigation when an employee noticed suspicious activity and flagged it to the board. Alibaba.com requires would-be vendors to provide business-registration documents to set up storefronts on the site. Findings showed that about 100 members of the company’s 5,000-member sales staff helped fraudsters evade steps to authenticate their businesses by submitting fake papers, enabling those involved to pretend to sell electronic goods at attractive terms and prices. The company had seen an increase in fraud claims by buyers against certain suppliers starting throughout late 2009 and 2010, which accumulated for only 1 percent of all suppliers in that time frame. A rep for Alibaba.com declined to comment on the total amount involved, but it has been reported that the company had paid out $1.7 million from its Fair Play fund to 2,249 customers that were scammed.

Although Alibaba has been placed under the capable hands of Lu, it is still unclear how easily the company will recover from such a major management change and if it remains susceptible to more fraud. The company said it expects the management changes won’t affect its financial results but Yuanta Securities analyst Liu Yixuan said Alibaba’s revenue growth could slow in the short term as it looks to clean up fraudulent accounts. Jack Ma, the Alibaba Group’s chairman, remains steadfast about his company’s future and warns, “We must send a strong message that it is unacceptable to compromise our culture and values.”

Alibaba.com has 57 million registered users worldwide, including 14 million on its English version site. Through the first three quarters of last year, the Web site had revenue of close to $600 million — all from registered users seeking to sell goods online.

February 11, 2011
By the ZippyCart Shopping Cart Reviews Content Team

Groupon, one of the largest online group buying sites, has made plans to offer its service in China.  Through a joint venture, Danny Yeung, CEO of Groupon’s Hong Kong unit says the deals will come “very soon.”

The company, which is known (among other things) for offering remarkable deals on various products and services, is fixing to expand its online sales of discount vouchers for restaurants, spas and an array of other goods and services throughout China. A smart move considering China has the most densely populated and fastest-growing economy in the world.

“We want to to dominate the market in China, says Yeung, who joined Groupon after it bought out uBuyiBuy.com last year, where he was CEO.

The company has already jump started their venture by previously hiring around 120 employees in China. Within the next three months they plan to increase that number to nearly 1,000.

Groupon plans to make its presence well known in China by strategically utilizing the $950 million it raised in previous months. They look forward to expanding the website, buying back a large portion of their shares, and squeezing out Chinese competitors like Lashou.com and Meituan.com.

In the past year, the company has been able to span the globe and increase its subscriber base of 2 million in the US to a worldwide 50 million deal seekers.

According to a Chinese-language technology news website, Donews.com, Groupon was able to set up a venture with Tencent Holding Ltd. to further root themselves into China’s culture and economy, though Groupon failed to verify the venture’s validity.

It may be just in time for Groupon to seek alternative deal seekers, as the company left a sour taste in the mouth of many people with the company’s Super Bowl ads. They showcased three ads during the game, showing Groupon making light of tragedies around the world, including one that trivializes the fact Tibetan people are in danger of losing their culture to China.

CEO of Groupon’s America division, Andrew Mason, apologized for the ads, saying they were meant in jest and not at all harmful.

“We take the causes we highlighted extremely seriously,” says Mason. “The last thing we wanted was to offend our customers.”

Don’t think this little hick-up in judgement will set back Groupon’s plans for global domination, nor begin think people will start to boycott the group buying site. The fact of the matter is that Groupon offers a service that we all desire and will always use. If there’s anything that Groupon has taught us, it’s that we shouldn’t take things at face value.

December 28, 2010
By the ZippyCart Shopping Cart Reviews Content Team

Walmart Stores Inc., the world’s largest retailer along with a group partners, have invested more than $500 million in 360buy Jingdong Mall, an emerging online Chinese retailer. While Walmart has not disclosed its part in the investment, Li Jing, a spokeswoman for 360buy says Walmart will act as a “strategic investor.” Analysts say ecommerce is growing at an explosive rate in China and Walmart looks to expand its presence along with it through 360buy.

According to their website, 360buy commands 15 million users and has distribution facilities in almost 60 cities. The company is expected to sell about $1.5 billion worth of online goods this year alone, up from $200 million in 2008. China already has the largest number of Internet users estimated around 420 million and according to iResearch, a firm that tracks web developments, online commerce in China could reach a possible $75 billion in 2010. Ultimately, these numbers attract a company like Walmart who want to quickly capitalize on the country’s vast numbers; however, they are not alone in this venture.

More and more U.S. investors and companies have also jumped on the Chinese startups’ investment bandwagon as the potential revenue China’s ecommerce looks to bring in is something that cannot be ignored. Chinese companies are even opting to go public in the United States in order to gain access to the broader base of capital and the distinction that comes with a Wall Street listing. Only a few weeks ago one of China’s biggest online video sites, Youku raised more than $200 million in a U.S. initial public offering. Now many other startups have followed suit, through the middle of December, some 35 Chinese companies have gone public, accounting for 23 percent of the initial public offerings in the United States, according to Thomson Reuters.

Although, even with the right financial backing, these startups have the greater challenge of competing in a space dominated by successful, already established ecommerce sites. Taobao, who is part of the larger Alibaba Group, is a heavy ecommerce giant in China with up to 75 percent market share. DangDang who’s business model is similar to Amazon, is the first Chinese ecommerce site to go public in the U.S but only has 3.7 total market share. Now with 360buy’s new financial backing, the site looks to beef up the competition as they currently maintain 14.1 percent of China’s B2C market according to data from Analysys Interntational. This deal is a smart move by Walmart, as they will have 300 stores in China, their partnership with 360buy will offer another step in their aggressive expansion into this burgeoning country.

December 24, 2010
By the ZippyCart Shopping Cart Reviews Content Team

E-commerce book store Flipkart recently announced its acquisition of social book discovery site weRead from Lulu Enterprises, Inc.

weRead is considered the largest book based social network. It provides readers a platform in which they can view book recommendations and reviews of over 3 million readers and 60 million book titles. The site enables its members to list, rate, and write reviews about the books they have read or are currently reading and share the reviews on their social networks (Facebook, Orkut, Yahoo, MySpace and Hi5).

Flipkart started off its career as an online bookstore but has since moved into new product categories such as movies, music, games, and even plans to sell software like Norton Anti-virus, Adobe, Windows and others. The site has over 7 million book titles ranging across all facets of the human life cylce (kids to adults). Flipkart currently operates from offices in Bangalore, Mumbair, Delhi, and Kolkata.

It’s no mystery why Flipkart decided to buy up weRead. Flipkart’s purchase will allow them to provide a new recommendation option for book worms to make more informed purchase decisions based on recommendations from people within their social network.

“Acquiring weRead will take out relationship with our customers to a wider plane where we will be their partner in the entire book reading experience – right from purchase to referrals,” said Sachin Bansal, CEO of Flipkart. Bansal goes on to explain how people will be able to make worry free purchases and discover a plethora of new reading material that caters to their particular interest, all in one area.

This is an obvious and very smart acquisition for Flipkart. They have now entered the realm of the social network, a network that is growing exponentially everyday. Just by making this purchase Flipkart has tapped into a market of millions of new customers, practically over night. Bravo, Bravo.

November 8, 2010
By the ZippyCart Shopping Cart Reviews Content Team

DeNA. The name might not sound familiar and even a bit odd, but this is a name to look out for. DeNA which is the combination of ecommerce and DNA is Japan’s leading mobile social game developer and platformer, they have become a mobile tech giant with their profitable Mobage-Town, a social gaming community. Users live in a virtual world with personalized avatars, games, and virtual interactions allowing real money to be used to purchase virtual goods. With 20.5 million registered users and growing in Japan alone, DeNA accredits their user engagement by combining social networking and gaming with a large viral presence.

The company has announced their third quarter revenues at $336 million up 216 percent from last years, and is on the way to bringing in $1.25 billion in revenue for their fiscal year. Think of how Facebook spans across the globe, with their estimated 500 million users domestically and internationally, for Japan, DeNA is like Facebook, if Facebook won the lottery and wore their big boy pants. DeNA claims their ARPU (Average Revenue Per User) bring in 30 times more than Facebook users. With such a financial momentum, DeNA’s next step is to become a global force entering into a market dominated by Facebook. DeNA looks to first bring their mobile technology and virtual community into the U.S.

Further expansion into the Western market continued in October 2010 with the acquisition of San Francisco based iPhone game developer Ngmoco for $403 million, who’s games have been downloaded more than 60 million times. This is one of four other U.S. investments DeNA has been involved with in the last 12 months. Their aggressive plans show no backing down as DeNA plans to target Apple and Google Android users. Using mobile devices as a platform to expand their virtual presence and social gaming. If Japan finds the same success they do at home but on a global scale, social gaming networks may just soon be turning Japanese.