Industry Leaders Weigh In On Impact of Alibaba IPO

Written on
May 9, 2014 
Mike Daly  |

ADOTAS — Chinese eCommerce powerhouse Alibaba filed to go public this week and listed its online marketing services as a primary source of revenue.

According to Business Insider, Alibaba is a Chinese e-commerce company with several businesses, including Taobao, a site similar to eBay, and Tmall, an e-commerce site for brands and retailers. Its revenue for nine months ending December 31, 2013, was $6.5 billion, up 57% year over year. Net income over that same period was $2.9 billion, up 305% year over year.

How will Alibaba’s IPO influence the ad industry?

“This listing represents not only the largest e-commerce company in the world but also the further establishment of a true mobile technology juggernaut,” said Sephi Shapira, CEO of MassiveImpact. ”Last year, Alibaba managed nearly 3 billion mobile transactions and is uniquely positioned at every focal point of China’s fast-growing e-commerce industry. They will continue to build upon this organically and by acquiring not only regional but also global players to further strengthen their mobile solutions. Do not be surprised if they go after some of the largest global players soon after this exciting IPO.”

“Alibaba’s IPO poses a challenge to the world of open ad exchanges such as Appnexus and even Google DoubleClick, as it further validates a direct type of relationship between publishers and advertisers who have their own in-house media buying platform, and even a proprietary real-time bidder that enables them to bid for each and every ad impression based on its value,” said Benny Arbel, CEO of myThings. ”Other advertisers who opted for an in-house solution include Walmart and some of the biggest CPG brands such as Uniliver, P&G and Kellogg. Amazon is another major retailer that is reportedly developing one as well. It is these big players who can pull it off since they have the kind of resources required to build a robust adTech platform.”

“Alibaba became a powerhouse in part through strategic mobile and online marketing efforts that turned an Asian-based eCommerce player into a global conglomerate that eventually went public in the US,” said Oren Barzilai, CEO of convertiFIRE. “This is a clear case study on how the emphasis on advertising  catapulted a company to international heights. For eCommerce companies looking to increase their bottom line – emphasis on advertising is key and employing innovative tactics in the advertising world will make their campaign standout from the competition.”

Mike Daly is an award-winning writer and editor with 30 years of experience in publishing. He began his career in 1983 at The News of Paterson, N.J., a long-since defunct daily paper, where at age 22 he was promoted to the position of Editorial Page Editor. Since then he has served in managerial capacities with several news organizations, including Arts Weekly Inc. and North Jersey Media Group in New Jersey and Examiner Media in New York. His work has been honored on numerous occasions by the New Jersey Press Association and the Society for Professional Journalists.

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