The most interesting global ecommerce rivalry of today is not that of Amazon.com, Inc. (NASDAQ:AMZN) vs Wal-Mart Stores, Inc. (NYSE:WMT) or that of Amazon.com vs rising startups. Today’s most significant head-to-head battle in the industry today is rather that of Alibaba Group Holding Ltd (NYSE:BABA) vs Amazon.com. Analysts expect this competition to further tighten up, particularly in Southeast Asia (SEA).
Alibaba Group Holding vs Amazon.com
Alibaba Group Holding has recently acquired Lazada, one of the fastest-growing ecommerce platform in SEA today, from Rocket Internet SE NPV (OTCMKTS:RCKZF) for $1 billion. This further expands the company’s network of online shopping platforms in the region. Aside from this, Alibaba Group Holding, through Ant Financial, is looking into injecting more investments in SEA.
What makes the Alibaba Group Holding vs Amazon.com rivalry more interesting are these long-term growth prospects. Of course, the former is not alone in banking on the growth of the ecommerce industry in SEA.
Amazon.com is also expanding its presence in SEA, particularly in India. It has an efficient growth strategy in the country, which involves $3 billion worth of investments. Given this, the ecommerce giant is highly expected to take over the Indian ecommerce industry in a sweep.
Similarly, Amazon.com is also said to bank $600 million worth of investments in Indonesia.
Is It Healthy for the Industry?
Smaller local ecommerce industry players in SEA, are threatened by this two-way competition. Alibaba Group Holding and Amazon.com, with their dominant influence worldwide, will surely make up most of the market share in the coming years.
For example, Wal-Mart Stores is already one of the leading ecommerce industry players in the US yet Amazon.com was still able to take over and account for a significantly larger market share.
“Indeed, if not dealt with properly by the entire ecosystem of Southeast Asia, it is possible these two elephants will stomp everyone in their battle,” emphasized Anh-Minh Do, a Vertex Ventures venture capitalist.
While the Alibaba Group Holding vs Amazon.com rivalry comes with a lot of benefits for the consumers and the entire ecommerce industry, it also has its downsides especially when it comes to promoting a healthy environment for startups and other emerging players.
On Monday, Amazon.com has closed at $766.77; Wal-Mart Stores has closed at $71.19; and Alibaba Group Holding has closed at $93.76.
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