Wednesday, August 12, 2009

What is Taobao? It's Big.

I had never heard of Taobao before. Then I read that this year they will sell more than Amazon will (about $19 billion). They have 120 million users. Wow.

Here is a definition of Taobao I found online:

Taobao is a shopping marketplace for consumers in China. Founded by parent Alibaba Group, it facilitates transactions between individual consumers and a wide range of sellers such as retailers, wholesalers, and other individuals. Similar to eBay, sellers are able to post new and used goods for sale on the Taobao marketplace either through a fixed price or negotiated sale or by auction.

A key difference between Taobao and eBay is that they make no money from the transactions. They make all their money from advertising.

I wonder if the Taobao experience and business model will begin to wag eBay and Amazon as Google and the iPhone have in their markets.

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