C1 ALIBABA. COM 1. Creating other successful portal in the future will be hard given that the lock-in effect makes the task difficult. Alibaba. com as an early entrant into the B2B portal market in China has built a strong advantage over its competitors; anyone who would want to challenge them will face some barriers to enter the market because as a starter, people will show preference for Alibaba. com, because of the experience, some people also develop loyalty or simply because they know the company. 2. Alibaba. om charges foreign sellers a lower annual fee for a TrustPass membership because Ma, the owner wants to attract the global companies, which spend most of their efforts on business with large companies, by giving them a good deal this companies will spend their money in China, with these SMBs that are paying Alibaba. com. In the other hand Alibaba. com charges $8000 or more for their annual listings as China Gold Suppliers because the owner believes that opportunities lie in connecting SMBs around the world with SMBs in China, which represents extensive traveling and expenses that this Chinese SMBs save by being part of Alibaba. om, they charge the Chinese companies with this membership for translating and listing their information. Ma is a smart guy because he identified a need and is covering it; by doing this he is helping not only his own pocket but his country’s economy by producing jobs and helping these SMBs to grow. Although he should raise the annual fee membership because as large companies, these companies have enough money to pay for a membership where the SMBs companies need some help in this aspect, he should raise the fee to the foreign companies to compensate the lowering in the fee to the Chinese SMBs. . One of the oldest lines of business is GE Lighting; they solicit bids from a variety of suppliers for indirect materials and machinery replacement parts . The online system made it easier to send out bid packages which allows the Purchasing Department to send out more bids to a wider range of suppliers. In particular many foreign suppliers, this could be a good opportunity for Alibaba. com, they could contact the purchasing department for the SMBs for a small fee for the translation of the purchasing process nd transactions. 4. Taobao. com can take advantage of the awareness people have of this type of business, people already know how this works, and they don’t need to educate the consumer. Ebay as a pioneer has already showed the way on how to do this kind of business; Taobao. com can improve or cover what Ebay hasn’t been able to cover. They can also innovate or transform the business. Ebay has a big advantage over Taobao. com , they have years of experience ahead, brand awareness because they are pioneers .
EBay’s success lies in being the first ones on providing a major web auction, which could be identified as a lock-in effect, even though there are other auction sites nowadays eBay is still leading. Ebay is always looking at its competitors to make sure they provide the consumer what the competitor is offering, they are innovating and this is why they are still leading. 5. Alibaba. com’s reputation can help Yahoo reach the Chinese market because people already know this site, people are aware of the web site, they know they have been doing things right, people can trust them.
People also know this website is from China, they will feel more identified with them, because of the language, traditions and the most important, their interests . Alibaba. com will meet in a better way their needs because they understand these needs and with the economic support that Yahoo can provide they will improve in many ways, they will be able to provide a better service and they also have opportunity of growth.