Can Alibaba rediscover its magic?

Can Alibaba Recapture Its Magic?

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Once synonymous with success in Chinese e-commerce, Alibaba is now associated with its difficulties. In 2021, the company became the face of official crackdowns against major Chinese tech firms, fined a record $2,8 billion for monopolistic practices. Alibaba's market value, which had topped $800 billion, fell below $170 billion at the end of 2022. To reverse the trend, Alibaba split into six last March, keeping its domestic retail operation as core revenue.

Alibaba's transformation in the face of challenges

Alibaba's decision to split into six separate entities marks a major strategic turning point for the company. This restructuring aims to make each branch more agile and better equipped to respond to rapid market developments. Divisions include Cainiao for logistics, Aliyun for cloud computing, an international commerce operation encompassing AliExpress, a digital services company controlling, and a small media group. The move highlights Alibaba's effort to revitalize its growth and sharpen its focus on key sectors.

Adaptation to new market trends

Alibaba's competitors, such as PDD and ByteDance, have excelled in adapting to new consumer trends, including "social commerce," which merges shopping and entertainment. To remain competitive, Alibaba must not only continue to innovate in its approach to e-commerce but also strengthen its presence in social commerce, an area where its rivals have pulled ahead.

Practical Tips for Alibaba

To win back the market and drive growth, Alibaba may consider investing more in emerging technologies such as artificial intelligence and augmented reality to enrich the online shopping experience. Additionally, more aggressive expansion into international markets could open up new revenue avenues. It is crucial for Alibaba to maintain a balance between innovation and regulatory compliance, especially in a context where the Chinese government closely monitors the activities of technology giants.


Splitting Alibaba into several specialized entities can be seen as a bold strategy to navigate an ever-changing business environment. By focusing on flexibility and innovation, Alibaba has the opportunity to redefine its future and continue to play a leading role in the global e-commerce ecosystem. Only time will tell if this strategy will allow Alibaba to regain its former magic.



Can Alibaba Recapture Its Magic?

Virginie Majaux

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