Formerly a symbol of Chinese e-commerce success, Alibaba has recently faced a series of challenges that have tarnished its reputation. In 2021, the company was targeted in a government crackdown on China’s largest technology firms, resulting in a record $2.8bn fine for monopolistic practices. Co-founder Jack Ma took a step back from the spotlight, causing further concern.
Meanwhile, competitors like PDD and ByteDance have excelled in meeting the needs of budget-conscious consumers and adapting to new trends like “social commerce.” As a result, Alibaba’s market value significantly declined, dropping below $170bn in late 2022.
To combat this downward trend, Alibaba made the strategic decision to split into six separate entities in March of the following year. These included a logistics business (Cainiao), a cloud computing division (Aliyun), an international e-commerce arm (featuring platforms like AliExpress), a digital services company (including food delivery app Ele.me), and a small media group. Alibaba proper retained its domestic retail operations, focused on Taobao and Tmall, which generate the majority of the company’s revenue.