Alibaba buys netease koala: win-win for cross-border e-commerce industry？
Recently, there are media reports that netease koala is financing, financing including alibaba, pinduoduo and other e-commerce platforms. Among them, alibaba is expected to buy netease koala for 2 billion yuan. On the 15th, several media reported that alibaba would buy netease koala deal has been confirmed, although netease and alibaba group\'s response to the news is still not to comment, but the news is basically a dead certainty.
Why did ali consider buying netease koala?
Engine investment analysts judge that ali may purchase netease koala for two reasons: 1. After acquiring netease koala, ali will become the leader in cross-border import e-commerce, forming a certain monopoly position; 2. 2. Avoid the acquisition of koala by competitors pinduoduo, threatening their current market share. The 2018-2019 China cross-border e-commerce market research report released by imedia consulting on March 22 this year shows that in 2018, netease koala ranked first in the domestic cross-border import market with a market share of 27.1%, while Tmall international ranked second with a market share of 24%. As can be seen from figure 1, Tmall international and netease koala still occupy the leading position in the first quarter of 2019, but Tmall international has jumped to the first place. If Tmall international and netease koala are \"combined\", the total share will be more than 50%, which means that Tmall international is in an absolute competitive advantage in the whole domestic cross-border market. On the contrary, if pinduoduo succeeds in acquiring netease koala, pinduoduo\'s market share will be significantly increased, and it will form a strong rival to ali\'s cross-border import business. Therefore, on the whole, ali acquired netease koala from the perspective of establishing monopoly advantage and preventing competitive threats.
Why did netease choose to abandon its largest cross-border e-commerce platform?
At the 2016 world Internet conference, ding lei made bold remarks in his speech: he hoped that in the next three to five years, netease koala overseas shopping could reach a scale of 50 billion to 100 billion in the market and create another netease in the e-commerce field. The key, however, is to make it happen. Netease koala in terms of financing and investment, has been carrying out different attempts but repeatedly failed. Back in November 2017, China business news reported that netease koala was planning an independent public offering. In addition, in February this year, it was reported that netease koala had offered to buy the overseas purchase business of amazon, but the final deal was not successful because of the high price offered by amazon. This also indicates that netease koala may have capital difficulties in investment. On the contrary, financing from the perspective of merger and acquisition is a choice more in line with netease\'s overall interests.
Shares of netease jumped 10.3% at the start of trading on August 8th. In this context, netease koala broke the news of selling or financing, from the market premium pricing strategy, is very conducive to netease koala sell satisfactory price. From the competition results of pinduoduo and ali, ali side can indeed give netease demand price. In addition, as can be seen from figure 2, netease kaola\'s market share has ranked the top two in China\'s cross-border import since 2018, but netease\'s e-commerce growth continues to slow down: from 175% year-on-year growth in 2017 to 20.2% in 2019, which undoubtedly alarms netease\'s e-commerce. Instead of struggling to compete with Tmall, which is difficult to shake the first position, it is better to merge directly and get funds for investment from other perspectives. Considering the overall interests of netease, it is undoubtedly better to stop losses in time.
The \"big guy\" level of \"fit\", whether to bring win-win?
Overall, netease koala growth rate slowed down, if netease still does not give up koala, will continue to invest a lot of resources to improve its growth rate and competitiveness. On the contrary, if it is sold to ali, netease e-commerce will no longer have to worry about the overseas supply chain system, and can concentrate more resources to build its own e-commerce. From the perspective of ali, ali will let the koala and foreseeable Tmall international convergence, the two sides will be in the supply chain, flow, in areas such as brand cooperation, complement each other, make both combined into a whole new system of cross-border trade, through the new mode of commercial economy layout, occupy the domestic market of cross-border trade advantage.
However, there are some dissenting voices in the market. \"I prefer netease not to give up on e-commerce.\" Naughty e-commerce founder feng huakui felt that alibaba\'s previous acquisitions are all around ecological synergy, will not directly buy a \"rival\". He thinks, ali invests koala not to be worth. \"Not only is there no return on investment, but there is a child to support.\" However, the ways and objectives of investment must be diverse and need to be innovated and explored. Even if the current acquisition of netease koala is equivalent to taking over a \"child\", when the \"child\" grows up, the return may be expected.
Indeed, after the withdrawal of amazon and netease koala, the cross-border e-commerce landscape will be further changed. Tmall international and netease koala \"big brother\" level merger, will also bring a revolution in the industry. Although alibaba and netease used to be powerful rivals in the field of cross-border trade, from the perspective of enterprises and the whole industry, rivals can also become friends in the field of financing and investment. This is undoubtedly a kind of enlightenment for the emerging block chain investment industry.