Top Biz News

Surfing for treasure

By Rong Jiaojiao (China Features)
Updated: 2010-01-06 08:06

When Rong Rong opened a Taobao shop in 2004, she did all the packing and delivery herself. Now she has her own warehouse packed with four shelves of hair products and employs three assistants. She has earned herself a 720,000-yuan apartment and a 200,000 yuan automobile.

"On a really busy day, more than 100 parcels need to be delivered. To date, over 50,000 customers have bought goods from my shop. The transaction volume grows 50 percent each year, with a 10 percent increase in profit," says Rong, 37, who used to own a hair salon.

She sold her hair salon last year and turned her part-time Taobao shop into a full-time job after profits from the shop tripled those from her hair salon.

"Prices for my products are not the lowest, but I sell the most in the hair product category. The key is to understand consumer behavior if you want to cash in on the website. Quality service and professional advice to customers choosing products that suit their hair condition are also important," she says.

"I have to work from 10 am till midnight. My only entertainment is walking my dog for half an hour after lunch. But I will continue the business. Nothing can beat the pleasure of seeing your own business grow from scratch." She adds that due to her influence, her father, who is in his 60s, has started online shopping.

The growing purchasing power of China's online shoppers has been noted by traditional brands from home and abroad.

Xinhua Bookstore has an outlet on Taobao; Japan's casual wear seller UNIQLO opened a shop in April; China Eastern, an airline company that operates from Shanghai, will soon set up an online ticket store on Taobao.com.

"The strategy this year for Taobao is to facilitate the business-to-consumer platform. The website will help more companies sell products online," says Ma Yun, CEO of Alibaba Group.

To fight fake products sold on its website, the company has injected 100 million yuan for an ad hoc campaign. Hundreds of shops selling fake stuff have been closed while those selling fake products are put on a blacklist.

"A sound Internet economy relies on companies' social responsibility in e-commerce. Credibility, security and services are the driving force for dot-com companies to grow," says Jiang Qiping, secretary-general at the Information Research Center of the Chinese Academy of Social Sciences.

Alibaba CEO Ma is confident about the prospects of e-commerce: "Among the 2 billion parcels delivered across China (last) year, 1.2 billion were goods from Taobao. We're planning to provide online shopping experiences for a billion people around the globe."

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