Aug. 8 (NBD) -- Taobao, online marketplace of Chinese e-commerce giant Alibaba, has announced the plan to team up with Alipay, a third-party payment platform of Alibaba's fintech affiliate Ant Financial, on the group-buying business.

NBD noticed Tuesday Alipay has included a new button for "group-buying" in its app, and users can access the service by logging in through Taobao accounts or Alipay accounts.  

When reached by NBD, a director with Ant Financial said it is a new function jointly launched by Alipay and Taobao. The new service is a bit like what discounter Pinduoduo offers and will launch deals at 9am, 2pm, and 7pm every day with a limited number of products available. These products will be offered by Taobao stores. 

Cao Lei, director of the China E-Commerce Research Center (ECRC), said to NBD that the launch of open mini programs and group-buying functions is part of Alipay's efforts to become a super app. Too much functions, however, may run the risk of overstuffing and losing the business focus, he added.

It is noted that this is not the first move Taobao has taken to develop the group-buying business. In March, Taobao launched an app called Taobao Special Offer Edition to meet diverse consumption demand.

Mr. Cao said that apps of Taobao, Tmall and JD.com have reached most of consumers, making it difficult for Taobao Special Offer Edition to get users. But the tieup with Alipay will offer Taobao an entry point to an enormous user base.

According to the latest financial statement of Alibaba, Alipay now has up to 550 million users. Data from a third party shows Taobao has more than 430 million monthly active users. Some analysts say the two giants' tieup would bring some changes to the domestic e-commerce sector.

The above-mentioned director of Ant Financial said group-buying is the first step of the cooperation between Taobao and Alipay and more is expected on upgrading of their group-buying model.

With the rise of online group discounter Pinduoduo, the purchasing model of group buying has gained growing acceptance, one industry insider told NBD. 

JD.com launched a mini program called "JD group-buying" in June this year. In late July, Suning.com has renamed its group-buying business and made August 8 the group-buying day.

But the industry insider said e-commerce gaints like Alibaba and JD.com will not run the group-buying business as a core business, but just as a defensive measure against Pinduoduo.

 

Email: tanyuhan@nbd.com.cn