Chinese online businesses rise to be the backbone of internet in 2007

On September 15, the Fourth Session of Chinese Online Businesses which was the Second Online Businesses Festival was opened in Hangzhou. The attending experts thought that, as the backbone in the development of the internet, online businesses were entering a new developing period after experienced the "emerging" and "survival" stages.

Online businesses are entering a rising phase

Some Related researches discovered that online businesses were emerging with four outstanding features: large-scaled, mainstream, pluralism and expanded influence.

On the aspect of transfer quantity, a survey to the online business enterprises reported that the occupancy of online sales proportion in the total sales of an enterprise had increased remarkably. Online transactions have become more common in netizens’ life with a high influence. Take Taobao for example, the total volume of transactions in the first half of 2007 made a breakthrough of 15.7 billion yuan, and particularly the high record of May and June in the second quarter, the average daily transaction volume was more than 100 million Yuan. At the same time, the staff of both enterprise and personal businesses have increased significantly, some personal enterprises which develop rapidly begin to employ a certain number of customer service staff. A new round of start-up is springing up like mushrooms.

The trend of online business becomes the mainstream is strong. The remarkable features are: from the marginal enterprises to the mainstream enterprises, from the coastal areas to the inland regions, the involved industries expanded from light industries to a balance between light industry and heavy industry and online commodities include more and more mainstream ones. For example, in the first half of 2007, 6 out of the top 10 categories of goods in Taobao with the highest sales volume are those in daily use.

A diversified market is emerging. Different from the monotonic business group in the last few years, today’s online business shows an apparent sign of developing in different directions and areas. Take demands for example, in the past, the focused demands were mainly concentrating on information and operation skills, but now the demands are concentrating on information quality, professional training and honesty, payment, physical distribution, financial and even policies, etc. and become the focus of more online businesses, meanwhile the online businesses having different scales begin to show different interests.

The socio-economic influence is getting more significant. Take online shopping as an example, it doesn’t only urge banks to open up the third-party payment business for bank industry, but millions of daily express delivery demands base also create a new great business opportunity for Chinese express industry. At the same time, the social benefits created by online business are also shown in terms of offering job opportunities, conservation of resources and helping disadvantaged groups, etc. A third-party study shows that, till the first quarter of 2007, Alibaba, Taobao have directly created more than one hundred thousand job opportunities for the society, and other invisible indirect employment opportunities.

The Growing Engine for Online Business

Several years ago, online business was only a vague concept on paper for most people. Years later, they are growing up a great economic power. Researches show that successful online business enterprises usually have the following features: strong network operating capability, continuous learning ability; attach great importance to online business from top to bottom, an institutionalized process flow for internal operation, high priority for integrity, mature business experience, open and progressive commercial personality,.

As for the evolution path, a common personal online business is like: netizen—e-friend—online business; buyer—seller; part-time—full-time---registered enterprise. However, most successful online enterprises begin to shift from "opportunity-driven" to "process-and-regulation-driven" model. For example, enterprises should set up an e-commerce department, give adequate importance to e-commerce as a crucial business channel and enhance operation e-commerce process and detail inside the enterprise.

Experts think that online business practitioners’ capability on new online commerce springing from accumulated and improved experience has the core value of doing business in this complex era. We can summarize ten factors for the successful rise of online business group.
1.Saving transaction cost as well as newly popularized high-efficiency and low-cost business culture.
2.Disappearance of imbalanced business operating status, including uneconomic scale of international procurement and the domestic imbalanced market caused by regional protectionism.
3.Meeting consumers’ individuality needs and gathering the sporadic demands and supplies in the market.
4.The web-based reintegration of industrial chain and value chain can foster the growing up of virtual enterprises.
5.Integrity mechanism development contributes to the establishment and maintenance of an increasingly matured internet integrity system.
6.Fast growth of experiences, knowledge and capability enable extensive flow and exchange among online enterprises.
7.Mutual stimulation and synchronized development of online enterprises and websites catering e-commerce.
8.Social assets are explored, activated, circulated and enhanced in the internet economy environment.
9.Preliminary online business ecology has been formed.
10.Internet ecology generates interior force which promotes rate of successful transaction.

The future development of online business will be ecological

From Alibaba first proposed the concept of online business in 2004, online business practitioners have been in the continuous evolution and development. Experts concerning about online business pointed out that from the primary stage, set-up stage to today’s emerging stage, online business in the future would present an ecological structure. Numerous add-value services, localized e-commerce practices and mutual assistance on outsourcing business will be all included in the concept of ecological online business. At that time, with the further popularization of e-commerce, commodity genre will become more diversified in online business and value circulation will be improved. Taking a deep thought, online business will gradually match with a more widen social economical system, which will foster the long-term development and stability of e-commerce platform and online business world.

On the other hand, from a more generalized view, online business development is helpful to the promotion of Chinese competitiveness and growing up, the national competitiveness is decided by the enterprises competitiveness which is determined by the entrepreneurs, from personal online business to enterprise online business, from single online business to e-commercial industry, from e-commercial industry to the promotion of national competitiveness, this chain will work much better and effectively as the generalization and efficiency of e-commerce.

Strong e-commerce platform will be the infrastructure of future commercial world and the continuous benign interaction between online merchants and e-commerce platform will help construct a new, globally competitive and appealing commercial mechanism. From the historical perspective, online business will eventually forge a new-pattern business personality and commercial civilization which are recognized by the society. The unique online business of China will therefore be of a great contribution to the global market economy and online economy. Those millions of mid-sized and small businesses and persons will be one of the leading roles in the future economic innovations.