Alibaba needs significant investment to tackle western retail giants
Chinese retail site Alibaba will not be crushing US commerce competitors Amazon and eBay anytime soon without major business, mobile and logistics acquisitions, according to a study from business research group Forrester.
China is the biggest online market in the world with 600m internet users
The study claimed that Alibaba does not currently have enough resources to take a significant share of the western retail market, adding that it would require some major acquisitions - or years of patience - to build the brand.
The online retailer, which will be aiming to take on online giants Amazon, Apple, eBay and Facebook, will have to bide its time and achieve consistent growth, the report claimed.
The report said: “Future investment possibilities include real estate, to bridge the gap between online and offline transaction, or possibly an alternative payment provider to help drive cross-border sales.
"The specific strategy is unclear, but it's likely that whatever Alibaba invests in will provide the one thing the company cares about the most: consumer data.”
Forrester reported three main global strategies that Alibaba would have to adopt on its shift from native China to the international stage.
These were that the retailer would have to invest in e-commerce platforms to drive sales while additionally looking to establish an extensive logistics partnership to ship its consumer goods fast, inexpensively and further than ever before.
Finally, the Chinese firm would have to invest in mobile platforms to acquire customer intelligence.
Currently, the e-commerce company is meeting with prospective investors in the run up to its flotation on the New York Stock Exchange (NYSE) as ‘BABA’.
Alibaba last week predicted it could raise as a much as £14.7bn in its initial public offering. If the firm's IPO analysis stands, Alibaba's could mark the NYSE's largest stock flotation to date.