Alibaba – A 2015 Spend Matters 50/50 Provider to Watch

100 companies - 100 days

When you think of the Internet, e-commerce and China, what names comes to mind?

Now you see why Alibaba made our 50 Providers to Watch list for 2015. There simply isn’t another provider that rolls off the buying tongue.

By the numbers, Alibaba is staggering. Early in 2015, Alibaba reported 350 million active daily users. (That’s greater than the population of the U.S.) Mobile users active on a monthly basis totaled 289 million. The company employs 24,000 and the retail marketplace value exceeds $300 billion annually.

Even though Alibaba has been a bit rough around the procurement edges given its lack of focus on a highly diverse set of offerings more targeted at Chinese sellers, consumers and local small and medium-sized rather than multinational procurement organizations, we’ve noted in our past coverage that Alibaba clearly has broader, global B2B ambitions and may even act to bring Western companies in the procurement sector to China.

After partnering with Coupa, we observed that “Alibaba is a huge force in China given all of its holdings and localized e-commerce services. But perhaps the most important part of the relationship with Coupa will ultimately be the potential of bringing Coupa to China and the broader Asia/Pacific market in a more strategic capacity, rather than serving as an integrated strategic search tool for procurement organizations — many of which are in fact reversing their course from a China sourcing perspective, except for supply chain localization).”

Alibaba has huge potential to serve the procurement market by evolving its largely B2C efforts into a broader B2B strategy. While its future in this regard remains to be seen (i.e., serving as an enabler of Chinese local or multinational procurement organizations or enabling Western companies to more effectively and efficiently collaborate with Chinese suppliers), we believe its procurement star will burn brighter in the years (and decades) to come.


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