Alibaba is once again undergoing personnel adjustments. On December 20th, Alibaba announced that Wu Yongming, CEO of Alibaba Group and Chairman of Taotian Group, will also serve as CEO of Taotian Group. From now on, Wu Yongming will concurrently serve as CEO of Alibaba Group, Taotian Group, and Alibaba Cloud Intelligent Group. Dai Shan, former CEO of Taotian Group, will assist in the establishment of Alibaba Group Asset Management Company, which is a new business function after Alibaba's transformation.
On that day, Alibaba Group Chairman Cai Chongxin announced the appointment through a letter to all members. Regarding the reasons for this personnel change, Cai Chongxin explained in the full staff letter that "in order to promote efficient strategic collaboration and high-intensity resource investment in the group's core e-commerce business related sectors," but in the eyes of industry insiders, the underlying reason may be the poor performance of Taobao and Tmall during the recent Double 11 and Double 12 promotions. At the same time, Pinduoduo's rapid growth in revenue and market value has doubled the pressure on Alibaba's e-commerce business, We have to accelerate the pace of change.
Driven by AI strategy, Wu Yongming holds three CEO positions
In March of this year, Alibaba launched a "1+6+N" organizational change. In September, Cai Chongxin and Wu Yongming officially took over as the Chairman and CEO of Alibaba Group, while Wu Yongming also served as the Chairman and CEO of Alibaba Cloud. After this adjustment, Wu Yongming will add another CEO position, currently serving as the CEO of Alibaba Group, Chairman and CEO of Taotian Group, and Chairman and CEO of Alibaba Cloud Intelligent Group.
On the third day of taking over as CEO of Alibaba Group, Wu Yongming issued a letter to all employees, announcing the establishment of two strategic priorities: "user first, AI driven", and conducting business restructuring around these two priorities, reshaping business strategic priorities, and carrying out reforms to rejuvenate the management team.
On the evening of November 16th, at Alibaba's quarterly performance conference call, Wu Yongming disclosed for the first time a new strategy to the outside world, clarifying Alibaba's important priorities for the next decade into three directions: technology driven internet platform business, AI driven technology business, and globalized business network. He announced that for its core business, Alibaba Group will maintain long-term focus and high-intensity resources and R&D investment, while each business will be based on independent business units, facing the market independently.
"Priority" was the most frequently mentioned keyword by Wu Yongming that night. On the basis of clarifying the group's reform measures, Wu Yongming fully introduced the development strategies and priorities of each business group, and also announced Alibaba's first batch of strategic innovation businesses -1688, Xianyu, DingTalk, and Quark.
At the end of November, Wu Yongming made judgments and trade-offs on Alibaba Cloud's strategic direction, and determined that Alibaba Cloud will implement an AI driven and public cloud priority strategy in the next five years. At the same time, he made significant adjustments to the business management team. On November 23rd, Alibaba Cloud announced a new round of organizational restructuring: the establishment of three new business units: Public Cloud Business Unit, Hybrid Cloud Business Unit, and Overseas Business Unit.
The hybrid cloud business unit aims to meet the needs of customers in certain industries who are unable to use public clouds in the short term due to policy restrictions. The R&D and service teams of the proprietary cloud will be integrated into this business unit to enhance the productization and standardization capabilities of the proprietary cloud. Compared to the goal of prioritizing the size of the public cloud business unit, the hybrid cloud business unit will focus on assessing profits, reducing project-based software and hardware order sales, and encouraging government and enterprise customers to prioritize the use of public clouds. The Hybrid Cloud Business Unit is led by Li Jin and is a first level department of Alibaba Cloud, reporting directly to CEO Wu Yongming.
At the same time, Alibaba Cloud has established a technical committee. The organizational structure of the Technical Committee is located under the Alibaba Group, and Alibaba has also established an Infrastructure Committee led by Wu Yongming at the group level. The members include Zhou Jingren, Alibaba Partner Jiang Jiangwei (Flower Name Xiaoxie), and Alibaba CTO Wu Zeming (Flower Name Fan Yu).
Half a month later (December 13th), Alibaba Cloud's Chief Business Officer, Cai Yinghua, resigned from Alibaba Cloud. Cai Yinghua is a key figure in Alibaba Cloud's promotion of government enterprise business in the past two years. He parachuted into Alibaba Cloud in March 2022 and was appointed as the Senior Vice President (M7 level) of Alibaba Group.
E-commerce GMV under pressure, Dai Shan steps down as CEO of Taotian
In addition to making drastic adjustments to Alibaba Cloud, Taotian Group has also recently adjusted its internal reporting relationship. For many industry insiders, it is not surprising that Dai Shan stepped down as CEO of Taotian Group.
As early as September this year, five subsidiaries of Taotian Group completed the change of business registration information and confirmed the new list of legal representatives and directors, supervisors, and senior executives. Among them, Wang Hai serves as the legal representative, chairman, and general manager of Taobao (China) Software Co., Ltd. and Zhejiang Tmall Technology Co., Ltd. Wu Zeming serves as the legal representative, executive director, and general manager of Hangzhou Alibaba Mama Software Services Co., Ltd. Liu Peng serves as the legal representative, chairman, and general manager of Zhejiang Tmall Network Co., Ltd. Wang Mingqiang continues to serve as the legal representative, chairman, and general manager of Zhejiang Taobao Network Co., Ltd General Manager. Dai Shan, CEO of Taotian Group, no longer holds concurrent positions in these subsidiaries.
At that time, there were speculations that Dai Shan might be transferred from Taotian Group. On September 27th, Taotian Group responded that the above changes were only common changes in the business registration information of subsidiaries and did not involve any changes in the group's management.
Dai Shan is one of the "Eighteen Arhat" of Alibaba. She joined Alibaba Group in 1999 and is one of the founders and partner of Alibaba Group.
According to data, Dai Shan served as the President of Alibaba Group's Domestic Digital Business Division from January 2022 to March 2023, and as the CEO of Taotian Group from March 2023 onwards. From January 2017 to December 2021, she served as the President of the Industrial E-commerce (formerly known as B-Series) Business Group, which includes Alibaba International (Alibaba. com), 1688.com, AliExpress, Taobao Deals, and Digital Agriculture.
Regarding Dai Shan's whereabouts, Cai Chongxin stated, "In order to optimize the return on capital and enhance shareholder value, the Group Capital Management Committee authorizes the establishment of an asset management company. Dai Shan will assist the Group in establishing an Alibaba Group asset management company and forming a professional management team."
Looking back at the only two years since Dai Shan officially took over Alibaba's C-series e-commerce business sector, the past two years have also been a period of decline and continuous pressure on Alibaba's domestic e-commerce business sector. On Double 11, 2022, Alibaba did not disclose the specific transaction volume for the first time. However, the financial report disclosed that in the second, third, and fourth quarters of 2022, the online physical product GMV (excluding unpaid orders) of Taobao and Tmall all decreased year-on-year. This situation has not been reversed in 2023.
Regarding the reasons for this personnel change, Cai Chongxin explained in the full staff letter that "in order to promote efficient strategic collaboration and high-intensity resource investment in the core e-commerce business related sectors of the group," but in the eyes of industry insiders, the underlying reason may be the poor performance of Taobao and Tmall during the recent Double 11 and Double 12 promotions.
This year's Double 11 closed, and Tmall announced a significant increase in user and merchant scale, driving a comprehensive increase in order volume and total transaction volume, but did not disclose specific growth figures. According to statistical data from third-party organization Star Map, the total online sales of Double Eleven in 2023 reached 1138.6 billion yuan, a year-on-year increase of 2.1%, with a significant slowdown in growth. Among them, the total sales revenue of the comprehensive e-commerce platform was 923.5 billion yuan, a year-on-year decline, and Tmall still ranked first in sales volume; The sales volume of Tiktok, Kwai and other live broadcast e-commerce companies was 215.1 billion yuan; Meituan, JD Daojia, and Ele.me's total retail sales reached 23.6 billion yuan; The sales revenue of community group buying is 12.4 billion yuan.
Following closely behind, "Double 12" is even quieter. At the end of November, the topic of "Taobao canceling Double 12" became a hot topic on Weibo. A notice in the Taobao merchant service hall stated that the "Double 12" event on Taobao will no longer be held this year and will be replaced by the "Taobao year-end good price festival" in December,
On one hand, e-commerce is driving weak growth and GMV continues to decline, while on the other hand, Alibaba is feeling pressure from its old rival Pinduoduo's "against the sky" growth trend. In the third quarter report released on November 28, 2023, Pinduoduo still far exceeded market expectations: a year-on-year revenue growth of 93.9% and a net profit margin of 22.6%, causing Pinduoduo's stock price to soar by over 20%. Compared to Taobao Group's revenue growth rate of only 4% in the third quarter, Taobao and Tmall Online's GMV continued to decline year-on-year.
Perhaps sensing the pressure exerted by the latecomers, on November 29th, Alibaba founder Jack Ma participated in a rare discussion on Pinduoduo among Alibaba employees on the Alibaba intranet. "I firmly believe that Alibaba will change, Alibaba will change. All great companies are born in winter. The era of AI (artificial intelligence) e-commerce has just begun, and it is both an opportunity and a challenge for everyone," said Jack Ma.