Going against the current, if you don't advance, you'll fall behind.

Manual Labor/Digging Uncle

Manual Editing/Angle Uncle

Produced by/Unicorn Observation

In 2013, Alibaba spent $80 million to acquire Umeng, a mobile data analytics company.

For Alibaba, which was then at its peak and continuously expanding its business empire, this acquisition was just an ordinary transaction of its size.

The person in charge of this merger and acquisition would never have imagined that the biggest gain from this project would be obtaining the future leader of Alibaba's e-commerce business.

On November 21, Daniel Zhang, CEO of Alibaba Group, announced the establishment of the E-commerce Business Group, led by Jiang Fan, who joined Alibaba as part of the "dowry" back then.

This business group encompasses Taobao Group, International Digital Commerce Group, 1688, and Xianyu, with an annual revenue exceeding 500 billion yuan, making it the lifeblood of Alibaba's business empire.

It's easy to find thousands of soldiers, but hard to find a general. The only acquisition that can compare to this one is Tencent's acquisition of Foxmail, which led to the creation of WeChat by Zhang Xiaolong.

If we go back to 2019, Jiang Fan was then serving concurrently as the president of Taobao and the youngest partner at Alibaba. At 34, he was the most promising successor and was known as Alibaba's crown prince.

But like most ill-fated crown princes in history, in 2020, Jiang Fan, at the peak of his life, was caught up in personal issues, resulting in the revocation of his Alibaba partner status, demerits, and demotion. A year later, Jiang Fan was "exiled" to oversee Alibaba's overseas business.

After a full circle, Jiang Fan has returned to the center of power at Alibaba. Both the macro environment and Alibaba itself have changed significantly.

Can Jiang Fan, who has experienced ups and downs, make Alibaba great again?

01 The Protagonist of a Feel-Good Story

Born in 1985, Jiang Fan is arguably the protagonist of a feel-good story in today's internet circle.

During his school days, Jiang Fan was the "other person's child." At 18, he won the provincial first prize in the National Olympiad and was offered admission to the Department of Computer Science at Fudan University. After graduation, he joined Google China and participated in the development of projects such as Google Maps.

In April 2010, Jiang Fan left Google and founded Umeng, a mobile developer service platform focusing on big data and other mobile services. In 2013, Alibaba acquired this project for $80 million, and he joined Alibaba with the money he received.

A widely circulated anecdote is that Jiang Fan originally intended to stay at Alibaba for a short time. However, during a heartfelt conversation with Daniel Zhang, then Chief Operating Officer of Taobao and General Manager of Tmall, Zhang proposed, "What if we do something together that you can tell your grandchildren about in the future?"

At a young age, Jiang Fan, who had already achieved financial freedom, was swayed by Zhang's proposal and chose to stay and "make a difference."

Jiang Fan played a crucial role in Zhang Yong's strategy of "All In Wireless," driving the growth of Taobao's wireless business.

In 2014, Jiang Fan began to promote the development of mobile Taobao App features, leading his team to establish Taobao's content system. The daily active user count of mobile Taobao increased from 30 million to 110 million, accounting for over 80% of Taobao's transactions.

Jiang Fan helped Alibaba smoothly transition from the PC era to the mobile internet era, propelling himself to the pinnacle of power. His rapid promotion was on par with the growth rate of mobile Taobao.

In 2017, Jiang Fan was promoted to President of Taobao, and in 2019, he concurrently served as President of Tmall. At 34, he became the youngest partner in Alibaba's history, entering the company's core management team, and earning the moniker of Alibaba's crown prince.

Young, wealthy, and talented, it's no wonder some netizens wonder what door God closed for him.

Up to this point, Jiang Fan's life has been a series of successes, lacking the twists and conflicts typical of a protagonist in a feel-good story.

With great power comes great responsibility. Ultimately, Jiang Fan could not escape the ill-fated curse of being a crown prince.

In April 2020, due to personal issues, the usually low-key Jiang Fan was thrust into the spotlight, becoming a topic of gossip among onlookers.

After encountering a "peach blossom disaster," Jiang Fan was stripped of his Alibaba partner status, received a demerit, and was demoted.

Would the most favored successor be forever removed from the center of power at Alibaba?

At the end of 2021, with Alibaba's structural adjustment, Jiang Fan was assigned to oversee the company's overseas business.

In the eyes of outsiders, this move from the core Taobao business to overseas operations was both an "exile" for Jiang Fan and an opportunity for him to prove himself once again.

If Jiang Fan had given up, he might have truly become a "discarded crown prince," but he chose the latter path.

The data speaks for itself.

In fiscal year 2021, Alibaba's international business revenue was 48.85 billion yuan, accounting for only 7% of the company's total revenue.

Under Jiang Fan's leadership, Alibaba's international business has maintained double-digit growth for multiple consecutive quarters.

In fiscal year 2024, Alibaba's international business revenue reached 102.598 billion yuan, accounting for 10.91% of total revenue, with a growth rate of 46%. During the same period, Alibaba's total revenue growth was only 8%.

From July to September this year, Alibaba's international business revenue was 31.67 billion yuan, accounting for 13% of total revenue and ranking second only to Taobao in scale.

Jiang Fan's performance over these three years has silenced critics and earned him a return to power.

02 Stagnant Alibaba

The increasing proportion of Alibaba's international business revenue can be attributed not only to its own efforts but also to the stagnation of Alibaba Group, especially the Taobao business segment.

In fiscal year 2021, the GMV of China's retail market, dominated by Taobao, reached 7.494 trillion yuan, a slight year-on-year increase of 2%. Amidst slowing growth, Alibaba began to bet on consumption upgrades.

In retrospect, this strategy misjudged the trend, but it's easy to be wise after the fact. From a business perspective, when growth stagnates, expanding upwards can not only increase revenue but also improve profit margins, aligning more closely with business logic.

As Alibaba lost momentum, Pinduoduo, which has been deeply entrenched in the lower-tier market and competed on low prices, embarked on a rapid growth trajectory. From 2021 to 2023, Pinduoduo's revenue grew by 58%, 39%, and 90%, respectively.

According to Dolphin Intelligence data, in 2023, Alibaba's e-commerce platform GMV was 7.2 trillion yuan, marking a decline of 3% and making it the only domestic top 10 e-commerce platform to experience a drop. Meanwhile, Pinduoduo grew by 31%, ranking second with over 4 trillion yuan in sales. Douyin and Kuaishou experienced growth rates of 47% and 33%, respectively.

If uncontrollable factors like strategic choices are set aside, Alibaba's frequent structural and executive adjustments reflect its anxiety about business stagnation.

Alibaba's major structural and executive adjustments from 2021 to the present are as follows:

At the end of 2021, Alibaba reorganized its business segments into domestic and international operations. Jiang Fan "departed" to oversee overseas business, while Dai Shan took over core businesses such as Taobao and Tmall.

In March 2023, Alibaba announced the initiation of an organizational structural reform known as "1+6+N." After this reform, each business group and company will implement a CEO responsibility system, and qualified business groups and companies will have the potential for independent financing and listing.

In June 2023, Alibaba announced that Joseph Tsai would succeed Daniel Zhang as Chairman of the Board, while Daniel Zhang would be replaced by Wu Yongming as CEO and a member of the Board of Directors.

In November 2023, Alibaba announced that it would no longer pursue the full spin-off of Cloud Intelligence Group, just half a year after announcing the "spin-off and listing timeline."

On December 20, 2023, Alibaba announced that Group CEO Wu Yongming would replace Dai Shan as CEO of Taobao Group.

On March 26, 2024, Alibaba announced its decision to withdraw the listing application for Cainiao, a move "to better strengthen collaboration with Alibaba's e-commerce business and continue to support Cainiao's investment in expanding its global logistics network."

In November 2024, Alibaba Group CEO Wu Yongming announced the establishment of the Alibaba E-commerce Business Group, appointing Jiang Fan to lead and integrate businesses such as Taobao and Tmall Group and International Digital Commerce Group.

In three years, Alibaba's core e-commerce business has seen its helm change hands from Jiang Fan to Dai Shan to Wu Yongming and back to Jiang Fan.

Some sectors prepared for spin-offs and listings are still in the planning stage, while others have already been initiated but then canceled.

Frequent leadership changes are a major taboo in military strategy. Constant strategic shifts can also cause internal Emotional fluctuations and unrest.

Can Jiang Fan solidify his position now that he has returned to power?

03 Making Alibaba Glorious Again?

There are signs pointing to Jiang Fan's return.

Last May, Jiang Fan's name appeared on the board of directors of three business groups: International Digital Commerce, Taobao and Tmall, and Cainiao. In July, his name reappeared on the list of Alibaba partners.

This official announcement of his return suggests that Alibaba is truly running out of options and had to bring back several "veterans" to oversee operations.

On the other hand, for Alibaba, which values its corporate values, the fact that it has re-embraced Jiang Fan indicates that he is indeed well-suited for this position.

From an age perspective, as a post-85s, Jiang Fan is still under 40, aligning with the trend of younger leaders in e-commerce and having a deeper understanding of the needs of younger consumers.

Furthermore, Jiang Fan is a pragmatic individual focused on business operations. Whether in Taobao's wireless business, leading the Taobao and Tmall Group, or turning around the overseas business that gave him a new lease on life, Jiang Fan has demonstrated a high level of business acumen and achieved outstanding results.

Just how capable is Jiang Fan? A commonly used testament is Wang Xing's comment on WeChat in 2019: "In the coming years, it should be exciting to see how the very smart Huang Zheng of Pinduoduo and Jiang Fan of Taobao/Tmall compete."

Heroes admire heroes. Being praised by a genius like Wang Xing on WeChat is like receiving a thumbs-up from Michael Jordan on the basketball court.

Moreover, for Alibaba, with nearly 200,000 employees, having lingered too long in its comfort zone has inevitably led to many common ailments of large companies. To break out of this dilemma, it needs the courage and passion of a second startup.

Therefore, this helmsman should not be a professional manager but should consider themselves a founder. Jiang Fan's successful entrepreneurial experience is precisely what Alibaba lacks now.

In 2019, at 34, Jiang Fan became the youngest partner in Alibaba's history and entered the company's core management team for the first time.

In five years, after demotion, exile, and self-redemption, Jiang Fan has returned to the center of power, still shining brightly.

But Jiang Fan is still Jiang Fan, while Alibaba is no longer the same Alibaba.

First, the external environment has changed significantly. One of the key factors in the success of early internet giants was catching two waves of growth: the internet boom and the mobile internet boom. As long as they chose the right direction and didn't make mistakes, they could ride the tide of history forward.

Now, the domestic internet boom has basically peaked, which is why many large companies are turning their focus overseas.

Moreover, Alibaba's e-commerce position has also changed. Alibaba's e-commerce, which once had no competitors in sight, has seen its market share gradually eroded in recent years.

According to statistics from "LatePost," five years ago, Alibaba's e-commerce GMV far exceeded the combined total of all major competitors, being about three times that of JD.com and over six times that of Pinduoduo. At that time, Douyin had not yet ventured into e-commerce on its own and was a marketing partner of Alibaba.

Five years later, while Alibaba's e-commerce transaction volume remains the highest, it is now equivalent to the combined total of the second and third places. Other indicators have been surpassed: transaction user count ranks second, behind Pinduoduo; parcel volume ranks second, very close to third-place Douyin E-commerce; DAU (Daily Active Users) ranks second, about 300 million fewer than Douyin and 40 million more than Pinduoduo.

The balance of power has shifted.

While Alibaba's e-commerce market share remains the largest in China, the overall environment has undergone tremendous changes. Both consumers and merchants have shifted their attention from Alibaba to platforms like Pinduoduo, Douyin, Kuaishou, and Xiaohongshu.

Going against the current, if you don't advance, you'll fall behind.

To lead Alibaba back to glory, Jiang Fan cannot be a defender but must be a changer.

Let's wait and see. (End)