I’m just back from lunch with Zeng Ming, the Chief Strategy Officer for Alibaba Group, and am now armed with a few new ideas about the future of e-commerce.
At RightSite we have a clear view of how we think e-commerce should work, and this is reflected in our platform approach to facilitating business. Since this is a philosophy that we share with Alibaba, it was interesting to hear the ideas of their top strategic advisor on where their group, and e-commerce in general are headed.
Professor Zeng explained that although the Alibaba group, and Taobao in general has been highly successful in China, that there will be major shifts taking place in e-commerce that will make B2C platforms like Taobao obsolete.
According to Zeng’s vision, e-commerce in China, and around the world, is moving toward a Dell-style model, which he terms C2B because it is driven by the consumer, wherein the buyer makes the decisions about what is on offer, and companies will compete to supply these products in the fastest time and at the lowest price.
As part of this future, production companies will be forced to create products in smaller batches and deliver them in less time. In particular, there will need to be a revolution in the way that logistics is managed and implemented, if consumers are to be supplied reliably via such platforms.
It was clear from our conversation that Zeng, and Alibaba’s leadership in general, see finding ways to integrate logistics solutions into an e-commerce platform as the next great challenge of online commerce.
What was not clear, however, is the impact that a shift toward on-demand manufacturing might have on suppliers working through B2B platforms such as Alibaba.com. If C2B is the model, and individuals are buying directly from manufacturers, then it would appear that much of the B2B ecosystem that Alibaba has helped to nurture will need to be integrated into Taobao-style platforms if this sector of the supply chain is to remain viable.
Prior to joining Alibaba, Zeng Ming served as a professor of strategy at Cheung Kong Graduate School of Business in Beijing, China. Between 1998 and 2002, he was a faculty member at INSEAD.
Here at RightSite we would count ourselves among this moved towards allowing end users to work directly with producers, as we are already making it easier for occupiers of manufacturing and logistics space to work directly with real estate developers over the Internet.
So if the C2B revolution happens like Professor Zeng predicts, then look for us out there surfing the crest of the wave.
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