Alibaba used shoppers’ data to invent a spicy Snickers bar
Brands spend hundreds of millions of dollars each year trying to figure out what consumers want. Now Alibaba is offering to help by vacuuming data up from the legions of people shopping, searching and sharing on its various platforms and providing it to companies eager to create products that will resonate with Chinese consumers.
In recent months, Alibaba has helped Mars Inc. create a candy bar and given Unilever NV valuable data for a new line of pollution fighting cosmetics; then thee-commerce giant advised both companies how to market the products. It’s all part of Executive Chairman Jack Ma’s “New Manufacturing” strategy, which he hopes will help define the future of the Chinese economy and cement Alibaba’s place in it.
“Nobody else has this ecosystem where one player has all the pieces together and can put together a single profile of you,” says ecommerce industry expert Ken Leaver. It’s helpful to think of Alibaba Group Holding as Google, Netflix and Amazon all rolled into one—and then some. The Chinese behemoth operates the world’s biggest ecommerce platform with 600 million monthly active users and the country. Its controls the Chinese versions of YouTube and Netflix (Youku) and even a supermarket chain and department store franchise. Alipay’s dominance in mobile payment systems and Alibaba’s retail software also means it can track consumer behavior offline in brick-and-mortar retail locations.
Alibaba’s market research arm, Tmall Innovation Center, can crunch data and show companies what Chinese consumers are seeking but can’t find. “We can see where there are blank spaces and unmet needs in the market,” says Duan Ling, Tmall’s director of brand marketing, who heads the innovation centre. Alibaba can also test products in consumers’ newsfeeds and search results, based on their profiles and realtime purchase behaviour. For now, Alibaba is able to collect user data with relative impunity because privacy is less of an issue in China than elsewhere.