What Alibaba's Success Means for U.S. Retailers
Gada added that more competition in the retail marketplace gives small businesses the opportunity to establish themselves on an ever-growing platform, potentially reaching new consumers.
Dr. Omer Artun, CEO and founder of AgilOne, a predictive marketing software company for retailers, agreed that the emergence of Alibaba in the U.S. will mean more competition for the other online behemoth, Amazon.
"The arrival of Alibaba as a formidable new competitor provides a real alternative to Amazon that didn't exist before," he said in a press statement. "In order to compete with Amazon, Alibaba should use Amazon's ruthlessness to its own advantage by becoming the new friend to these merchants."
So, does Alibaba really mean trouble for a company like Amazon that's been able to dominate the playing field? In the FoxNews.com story, Gada suggests that the excitement over Alibaba might be just a lot of hype at the moment.
“It’s exciting, it’s an interesting story, but it isn’t easy to automatically build brand loyalty," she said. "A company like Amazon really mastered customer service. It's made it their mission, and it’s an uphill battle for any company to compete against that.”
For Alibaba to explode in the U.S., it will have to focus on developing itself as a global brand. Given that it's essentially an umbrella company that incorporates distinct businesses that do exactly what Amazon, eBay and Overstock.com have been doing successfully on their own for years, Alibaba will have to set a social media agenda and take a “guerrilla marketing” approach to grow, Gada added.
A research note from Forrester offers a similar opinion.
"Despite its dominance in China, Alibaba won’t be sweeping away U.S. market share in the near future." the report said. "Rather, it will take a major acquisition or a number of years for Alibaba to pull together a platform that could compete with major players like Amazon, Apple, eBay and Facebook."