On the evening of November 16th, Wu Yongming, as the CEO of Alibaba Group, participated in the quarterly financial report analyst conference for the first time, detailing Alibaba's future direction, important priorities, and implementation path, and officially announced the first batch of strategic innovation level businesses. This is also Wu Yongming's first comprehensive explanation of Alibaba's strategic plan for the new stage of development after taking office as CEO of Alibaba Group on September 10th.
Wu Yongming stated that the driving force for industry development in the future will be the technology driven force represented by AI. Alibaba will have three important priority directions for the future: technology driven internet platform business, AI driven technology business, and global business network.
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. Taobao Tmall adheres to the strategy of "user first" and adheres to consumption grading and pricing power; Alibaba Cloud will adhere to the principle of "AI driven, public cloud priority" and develop with a dual wheel drive of AI+cloud computing. He also announced the first batch of strategic innovation businesses of Alibaba -1688, Xianyu, DingTalk, and Quark.
Resolutely choose and take three measures to transform Alibaba
After 24 years of development, Alibaba has become a group that spans core businesses such as e-commerce and cloud computing, as well as numerous innovative businesses. How should we choose strategic priorities and seize opportunities of the times? Wu Yongming provided his solution - using three key measures to transform Alibaba and face the future.
Next, Alibaba will establish a highly flexible and fast decision-making governance mechanism and incentive system. In the future, each business line will be based on independent business units, more independent and market-oriented.
Alibaba will sort out the strategic priorities of existing businesses and define core and non core businesses. For core businesses, we will maintain long-term focus and high intensity investment to ensure that our products always keep up with user needs and evolve iteratively, maintaining long-term vitality and competitiveness; For non core businesses, asset value will be realized as soon as possible through various capitalization methods.
Alibaba will also better leverage its strategic incubation function and make resolute strategic investments towards the future. Wu Yongming emphasized that businesses that meet user needs and AI driven change trends will be prioritized as the first priority investment; For innovative products that are oriented towards the future, we will adhere to long-term principles and resolutely invest, with a three-year evaluation and testing cycle to cultivate new business and momentum for Alibaba towards the future.
Not positioning Taobao as a retail company, Alibaba Cloud adheres to AI driven
In the strategic cycle for the next three years, Taobao Tmall will further clarify its business priority - user first.
Focusing on users first, Taobao adheres to being the "universal Taobao", adheres to consumption grading and pricing strategy, and insists on choosing the user value of products. Wu Yongming said, "We need to firmly establish a comprehensive platform to meet the multi-level needs of the largest consumer group. This is the choice for Taobao and Tmall to maintain growth in today's competitive landscape
Taobao will implement a multi-level market strategy and price power strategy within an app. Wu Yongming believes that as a super app, Taobao has the ability to accommodate multiple product layers and value propositions from brand to white label. Through the iteration of AI technology and operational models, Taobao will be built into a consumer app that includes diversified markets, and price power will be the core strategy for penetrating all levels of products.
Wu Yongming also emphasized that Taobao will adhere to its positioning as an internet consumer platform and "does not position itself as a retail company". As a consumer platform, the frequency of user purchases will prioritize GMV as the most critical goal, as "the frequency of purchases directly reflects the user's recognition of the consumer platform".
Cloud Intelligence Group will implement AI driven and public cloud priority strategies, and increase technological investment in AI related software and hardware fields. Through "cloud+AI", we support the intelligent transformation of various industries and create greater opportunities for era increment.
Wu Yongming judged that computing paradigms are undergoing fundamental changes, and the world is at a technological inflection point where traditional computing is transitioning to the central position of AI computing. In the future, Alibaba Cloud will persist in doing two things well: first, creating the "most open cloud in the AI era" to provide stable and efficient AI infrastructure for the entire industry; The second is to create an open and prosperous AI ecosystem.
Wu Yongming also stated that he will make trade-offs between all Alibaba Cloud products and business models, reduce project based sales orders, and increase investment in public cloud core products. Adhering to prioritizing public clouds can enable us to reap economies of scale and technological dividends in the future
In addition, Wu Yongming stated that Alibaba Group will maintain long-term and resolute investment in Alibaba Cloud's strategic direction, while Cloud Intelligence Group will continue to operate as an independent company, adopting a CEO responsibility system authorized by the board of directors.
The technological revolution drives product innovation and announces the first batch of strategic innovation businesses
Alibaba has stated that it will continue to invest in and incubate strategic innovation businesses for the future. At the analyst conference call, Wu Yongming disclosed for the first time the selection criteria: having sufficient huge market space, unique market positioning, meeting user demand trends and the group's "AI driven" strategy, and announced the first batch of strategic innovation businesses -1688, Xianyu, DingTalk, Quark.
Wu Yongming said that 1688 is Alibaba's oldest business, serving mainstream manufacturers in China's manufacturing industry. It has a solid foundation and huge potential for secondary entrepreneurship, and is expected to expand from B2B business to small and medium-sized enterprises and consumer procurement. At the same time, it has the service capability to support cross-border transactions. Xianyu will be a lifestyle platform that carries the hobbies and fun of young consumers.
Nails and quarks have gained unprecedented imagination due to the arrival of the AI era. Everyone and enterprises will have personalized intelligent assistants, and DingTalk is expected to become the best AI intelligent assistant platform. In the era of big models, facing young people, Quark has a huge opportunity to create innovative search products
The above strategic level innovation business will be operated as an independent subsidiary in the organization, breaking the previous positioning restrictions within the group, and Alibaba will continue to invest in it on a 3-5 year cycle.
A successful technology company must have the ability to cross the technology cycle, "said Wu Yongming. No product has a long-term moat. Facing the AI era, Alibaba will resolutely devote itself to the technological revolution and product innovation, create and incubate innovative businesses and technological products, and meet the new expectations and demands of the continuously expanding market for products and services.
We have sufficient leading resources, strong cash flow, flexible governance mechanisms, and a reserve of excellent talents. We believe that we can stimulate existing businesses to unleash new momentum and create more new development opportunities, "said Wu Yongming.