Taobao University (Case Study 2019)

 

Taobao University

Case Study of Taobao University (2019)

Taobao University is a training department within the Alibaba Group that provides services specifically to vendors on the Taobao platform. It is positioned as an educational platform.

 

It provides professional training for vendors who are currently operating websites on Taobao as well as vendors who want to start a business but do not have experience.

 

Taobao University, the T-mall Vendors Training Department, and a number of departments within Alibaba, including the department for developing vendors (bringing them to maturity), spent considerable time and effort on this.

 

As yet another 11.11 Shopping Festival swept over China like a heat wave, Taobao and Tmall grew another year older. From the day they were established, these two dynamic websites showed a great affinity for attracting business.

 

A number of grassroots brands had made use of the Taobao platform to grow into large businesses and open up their own territory. A number of traditional crafts, such as dying and embroidery, also found loyal customers on Taobao and created a unique kind of adornment.

 

Given increasingly segmented lines of business in China, the innovators of all kinds of unusual and intriguing endeavors found a place to ply their wares on the Taobao website. The creativity of shop owners was allowed a full range of expression.

 

Not only did Alibaba constantly stay at the forefront of innovation, but it also mobilized tens of millions of grassroots entrepreneurs to do the same. It built a free and easy “cradle of creativity” for innovators to do their thing.

 

One might well ask how it was that tiny grassroots peddlers could manage to find business opportunities in the context of fierce online competition. How could they then build themselves up to real strength?

 

What secrets lie behind the legendary stories of so many Internet companies—what are the tricks to being successful, the paths to innovation? How can other potential vendors, lacking experience and yet full of the desire to try, find a way to survive in the stormy turbulence of e-commerce?

 

In this blog, we get closer to an Alibaba that is not well known to outsiders. We look at the kinds of efforts that Taobao’s online customer services providers put into helping grassroots entrepreneurs.

 

We look at what kinds of experiments these entrepreneurs try, what kinds of successes they have, what challenges they face, and what setbacks they have endured.

 

Taobao University: Serving As Incubator for Training New Vendors

Taobao University Incubator

“Unleashing the entrepreneurship of store owners” is easy to say but not so easy to do. A myriad of products is now flooding markets. Products that declare that they are innovative by just sticking on a new label are simply gushing forth.

 

Meanwhile, the real breakthroughs, the success stories, such as frozen food sold via the Internet and ethnic clothes made to order also have faced all kinds of bottlenecks and problems.

 

They have had to deal with raw materials, logistics (handling and shipping), marketing, and everything else. Alibaba is highly aware that innovation is not just a matter of having a good idea and not just a matter of carving out an innovative path.

 

It is more a matter of turning these new things into successes. Taobao University, which is described next, teaches vendors how to turn innovative ideas into reality.

 

From starting out with the most basic operating training on e-commerce, it has gone on to conduct offline training tours around the country, visiting 50 cities with a team that includes the most successful sellers on the net.

 

It also has gone from being a completely free public good, providing primary training, to positioning itself as an increasing high-level professional service that receives compensation.

 

After nearly 10 years of growth and development, Tao-U, as it is called, also has gone from training supply-chain logistics and transaction credit procedures to preparing people for a more strategic approach to growth.

 

Throughout this process, Taobao University has consistently held to its core mission: helping the world make money rather than making money off the world.

 

Its reflexivity is extremely powerful. It develops itself by constantly thinking about the needs of vendors.

 

It is like a patch of very fertile soil that nurtures the growth of tens of millions of e-commerce entrepreneurs and that then witnesses their miraculous successes, one after another.

 

The Source of Taobao University

Source of Taobao University

A famous line in Tang Dynasty poetry describes the effects of a gentle spring breeze that passes over the land, putting all the pear trees in bloom in the course of one evening. This elicits comparison with the many e-commerce businesses that sprang up in China at the turn of the twenty-first century.

 

A profusion of “shops” appeared on the Internet selling everything from women’s fashion to low-cost household electronics to high-cost luxury items.

 

They emerged and then hoped for a business like sunflowers facing the sun. The soil that nurtured these things, however, kept a very low-key and humble attitude. The name of this patch of fertile soil is Taobao.

 

Many people view Taobao as being akin to Wangfujing in Beijing in that it relies on its premier location. It has the advantage of occupying a unique space all by itself.

 

In fact, just as Wangfujing needs the plans of designers and the cleaning services of a host of sweepers, Taobao also needs designers to help it with the platform that supports the online operations of merchants. It needs their acutely sensitive creativity to constantly adjust its functionality.

 

Wangfujing, located in the center of China’s capital city, may have a constant flow of people, but it also still has the underlying precision of excellent management and standardized rules. Every day, Taobao’s network carries traffic that amounts to tens of millions of visits.

 

Without a highly refined set of standardized systems, all those large and small, new and old storefronts would be pouring the blood of their efforts to increase traffic out into the sand.

 

Meanwhile, as everyone knows, when e-commerce was just beginning, traditional branded enterprises kept firmly to their offline mode of operations. As a result, they were not fast enough to catch the wave of Internet sales. The large numbers of online storefronts came from the most simple and unadorned ideas of people at grassroots levels.

 

To use the words of highly qualified Taobao staff, going from 10,000 to 1 million may not have been such a hard thing to do for these grassroots shops, especially given the overall prosperity of e-commerce in that period. Going from 1 million to 100 million, however, began to make store owners feel that perhaps they lacked sufficient experience and professional knowledge.

 

They began to feel that their heart was in the right place, but they did not have everything else that success requires.

 

The question for Taobao then became whether or not to accept the cold logic of the market. Should Taobao allow micro entities to go belly up, especially if they had no way to realize their own potential by themselves?

 

Or should Taobao “borrow a ray of light” and serve as a lighthouse for them, guiding their passage, showing them how to break through bottlenecks and bravely keep moving forward?

 

The Taobao platform chose the latter course of action. In June 2007, a department called the Vendors Training Department emerged to meet the needs of the time. This was the precursor of Taobao University.

 

The Future of Taobao University

Future of Taobao University

From the day of its inaugural ceremony, Taobao University has always positioned itself as being a platform. However, Tao-U personnel say themselves that the platform as it exists today is a little like functioning under the planned economy.

 

That is, Tao-U itself analyzes what it thinks the market needs. How does it know? Generally speaking, it does so by the following several channels:

 

1. It knows what the market lacks (needs) via new training demand, as generated by advances in science and technology. For example, every time new e-commerce operating tool is launched, there is a corresponding need to know how to manage this tool.

 

2. It knows what the market needs via changes in the demand for training in line with changes in production relationships.

 

For example, a normal online store may have one fairly singular goal when it first starts out, namely, to make money. Because of this, training must focus mainly on operations, advertising, and sales as the core subjects.

 

Once that store reaches a certain size, however, the owner may decide to do retail business, set up a retail store, and enter into the next stage in growing its e-commerce business, so he or she then needs a higher level of training.

 

3. It knows what the market needs when changes in what consumers focus on drive changes in the demand for training. In the realm of the Internet, the way in which changes in consumer behavior drive business changes goes without saying.

 

For example, platform designers might be able to deduce the psychological needs of consumers by reviewing what consumers search for and what programs they mainly watch; these designers then guide vendors in trying to match what vendors provide with what consumers need and want.

 

4. It knows what the market needs by the kinds of questions that are asked in training sessions.

 

 For example, fairly high-level vendors may raise demands that are highly targeted, including supply-chain training, training in e-commerce branding, and so on, but demand generated by this path is relatively smaller. As online courses constantly improve, most vendors will be able to find the courses they need.

training programs

In developing training programs in the future, the platform will focus more on the needs that vendors propose themselves. Only by truly paying attention to the difficulties being faced by grassroots operations will the program be able to unleash their entrepreneurship.

 

Only by exchanging places with them and thinking as they think, standing in their shoes, will the program address the problems and resolve them, and only then will it make the whole endeavor a success.

 

Some people ask how Alibaba can have survived and prospered through all these years, having weathered the bursting of the Internet bubble, eBay’s declaration of war, and other challenges.

 

How can it keep its head up and look to the future? Alibaba firmly believes in what it is doing. It believes that being simple and straightforward leads to being great.

 

In a materialistic society that is immersed in the worship of money, Alibaba holds to its earliest belief, which is return e-commerce to commerce. Each challenge that the company takes on and overcomes is not just for show and certainly not for the sake of public officials.

 

The company’s intent is to create fertile e-commerce soil for servicing the “little trees” so that they can grow and prosper themselves. The core value concept of Ali-people—trust—runs through every action the company takes. As Ali-people say, the process of arriving at the trust is far harder than the results of achieving trust.

 

Only by gaining the trust of ever more people, however, will the company and our society has any kind of force that propels it onward and upward. In the eyes of Ali-people, each satisfied smile of a customer, each sincere word of praise, each result, each time things go as expected brings an enormous sense of accomplishment.

 

Ali-people are most glad when they can help customers improve, whether that is in small ways to increase immediate sales or in larger things such as establishing brands. The customer is core—this is what has helped Alibaba to come through hardship and see real success.

 

Maturing of the University

Maturing of the University

Seedling Stage: 2003–2007

The early period of Alibaba and the Taobao platform did not actually have many elements to it that were original inventions. In 1995, when founder Jack Ma set up China’s “Yellow Pages,” he imported the e-commerce model of the United States.

 

Later, Alibaba’s highly successful business-to-business (B2B) business, which was listed on the Hong Kong Stock Exchange, was still, to a large degree, simply localizing a model copied from elsewhere.

 

The birth of the Vendors Training Department was something Taobao did to reduce the distance that still separated China from America’s level of e-commerce.

 

In 2003, at a time when 100 or more titles on e-commerce could be found in bookstores in America, books on the subject in China were extremely narrow in focus and mostly were limited to textbooks or educational material.

 

In 2003, when eBay’s homepage was alive with the ads of major international brands, inside China, frontline brands still shrank from the idea of appearing on Taobao.

 

They did not want to set a foot in these waters. In that same year, all kinds of Internet sites were up and contending with one another. Finally, in order not to let the opportune time pass by, still in 2003, the precursor of Taobao University, the Vendors Training Department, finally declared its existence.

 

“If you want to be innovative, first copy others.” This realization was something Alibaba had practiced for many years as an innovative company. Between 2003 and 2007, the Vendors Training Department remained at a fairly preliminary stage of development. A team composed of only four people was responsible for everything it did.

 

To start out, the team selected store owners who had the particular prowess of one kind or another and asked them to describe their experience for everyone’s benefit.

 

The team was able to find vendors with whom to exchange information on all aspects of the business, including sourcing goods, photographing products, marketing operations, logistical management, customer service, and transaction security.

 

For the first few years, the Vendors Training Department trained eight lecturers. They came from the cutting edge of the market and had developed their own set of ways of doing things that covered all links in the production ecosystem. For example: How could one predict sales volume over the near term so as to have adequate stock on hand?

 

From small things, such as servicing details, to larger things, such as operating rules and regulations, everyone talked about their own successes, and everyone had a good time.

 

Meanwhile, Taobao staff who were designing the actual platform saw how these “children” (Taobao vendors) helped one another and found it hard to express their delight.

 

Growing Stage 2007

Taobao platform

Taobao realized an annual turnover volume of 43 billion RMB in 2007, and mainstream products began to be sold on the site that same year.

 

The Taobao platform seemed to have taken some of the wind out of the sails of Target and Walmart. Also in 2007, the Vendors Training Department executed an extremely courageous maneuver.

 

It had always remained behind the scenes, but now it emerged and took a team of Taobao’s most proficient vendors on an offline training tour, stopping at 50 cities around China.

 

The members of the team put up notices on bulletin board services (BBS) describing the locations of the training sessions and the qualifications of their lecturers.

 

Once vendors learned about this, they crowded into the sessions. Each of the 50 sessions was totally full. In some cities, where the room was fairly small, attendees spent the entire time standing, drinking in the lessons with rapt attention.

 

The passing along of knowledge, the enlightened understanding, the sharing of experiences, the infectious nature of the enthusiasm all put a kind of magic wand into the hands of these grassroots store owners.

 

Once the evenings came on and they returned home to wave their wands ever so lightly over their own work, the products on their online shops began to glow.

 

Still in 2007, when the sale of actual goods was enjoying a high tide, traditional forms of training also began to be affected by the spring breezes of e-commerce.

 

At the time, many cities were holding training sessions on the Windows operating system, five-stroke typing training, and computer-aided design (CAD) drafting.

 

These offline training sessions lacked a systematic approach and could not be scaled up, but the market demand for them was enormous. Clear-sighted people recognized a business opportunity.

 

They decided to incorporate skills-based training into the training systems of e-commerce. This idea galvanized the development of a large amount of skills-based training. The mutually stimulating effect among industries also proved infectious.

E-commerce

E-commerce is a very young industry, and it relies on the Internet, with new technologies as the core content. Supply and demand follow the market, while all cutting-edge, fashionable, popular things can see their reflection in the realm of e-commerce. Meanwhile, those engaged in e-commerce are mainly young people who are themselves up with the times.

 

In early 2007, some students from colleges and institutes in Jiangsu, Zhejiang, and Shanghai began to explore the idea of starting their own Internet shops. Without any place to store the goods, they stuffed them into their own bedrooms and along the halls of their buildings. Despite the tough conditions, they found a way to survive.

 

This exploratory kind of self-directed operation was not the way to grow to any kind of scale. Nevertheless, this group of college students was able to build some outstanding stores.

 

At the time, most e-commerce stores simply were lucky to meet with the needs of the times. They did not put too much thought into their own sales strategies and operating methods, but somehow or other they made money.

 

Wang Jiaying, who sold wrapping paper, said that he did not need to worry about sourcing goods because a relative of his sold paper cartons. He simply registered his shop online and began to do business. However, as more and more people began to participate in e-commerce, this became less feasible as a business plan.

 

Solitary efforts generally meant that the abilities of these sole proprietors did not match their ambitions. Sourcing goods from relatives could not become a widespread business practice, and it definitely was not a long-term strategy. Because of this, Taobao’s role in assisting these vendors became all that much more important.

 

In schools that teach professional skills, such as commercial and industrial institutes, students are taught a certain basic curriculum in such things as marketing and business operations, but this is seldom put to use in any practical application. Given this, Taobao again initiated a quite marvelous practice.

 

It decided to link up with institutes of higher education and provide students with practical training, what the company called “the last kilometer.”

 

Starting in 2007, Taobao cooperated with various schools and institutions of higher education in Jiangsu and Zhejiang Provinces. The company appointed a vendor training professor with top-line experience to teach the professors in the school and help them to enrich their courses with case examples.

 

This helped to blend theory with enlightened practice. In addition, the company provided an actual battleground for students. In actual drills, the company sharpened their capabilities and the quality of their work. The original training, which had been adapted to the Internet, was now localized and based on teaching in schools.

 

The year 2007 was a milestone for Taobao University’s own growth. The training team, like the proverbial Lushan Mountain, wreathed in clouds, had not been too willing to show its own face.

 

It now came down to the grassroots level in person and began to meet with vendors face to face. What had originally been a fairly wild and undisciplined form of training used the e-commerce platform to become a more standard track.

 

The original mode of operating by feeling for the stones as you cross the river, using college graduates as representatives of grassroots entrepreneurs, now became professionalized training. In this year, the fertile soil of Taobao University spurred the emergence of one after another and group upon group of superlative e-commerce enterprises.

 

Opportunities and Challenges Coexist:

Opportunities

In 2008, however, e-commerce began to face unprecedented challenges. First, in the early part of the year, a rare snowstorm blocked all the roads, so shipping was harder than ever before. It was impossible for customers to get the goods they ordered, and public confidence in e-commerce dropped sharply as a result. 

 

On the one hand, the team dealt with an unending stream of natural disasters. On the other, it witnessed an unstoppable wave of “informatization.” In 2008, transaction volume on the Taobao platform almost doubled compared with the preceding year, reaching more than 90 billion RMB.

 

In the same year, in order to meet the rapidly expanding demand for its services, Taobao University brought its offline training to an end and formally launched an online training system that centered on an Internet-based curriculum. To this day, members of the Taobao University team are proud of this innovation.

 

Why choose to set up a highly refined online training system? The answer relates to the primary characteristics of e-commerce. Taobao vendors sit at a computer all day, handling orders and transactions, and it is sometimes hard for them to grab a block of time to go attend a training seminar.

professional expertise

Second, vendors have varying levels of education and professional expertise, so a standardized offline training program is a somewhat low-efficiency approach. Finally, it is not cheap to hold offline training in terms of renting space and finding the time, and the number of people who can be trained at each session is limited.

 

Faced with these challenges, the Taobao University team came up with its own way to deal with the situation.

 

First, the team published books and materials relating to e-commerce. In the past, educational materials in the market relating to e-commerce focused on the theoretical side and even then were limited in quantity and variety. They simply did not meet the needs of readers.

 

After 2008, Taobao University published 50 or 60 titles on e-commerce to make up for the lack of case studies and practical experience described in existing materials. Second, the team set up an online educational system.

 

They videotaped a variety of curriculums that were divided up by both subject and degree of expertise and made these available for free to the outside world. At the time, 40,000 people-times received training every day. Third, they set up a training program aimed at each job description in e-commerce.

 

For example, they provided information on what a shop owner might need to know and what each member of the staff might need to know given that the caliber and capabilities of different people would necessarily be different.

 

In designing its curriculum, Taobao University was highly attentive to different administrative levels. Starting in 2008, Taobao University, therefore, began to move in the direction of providing systematic training, making a smooth and easy pathway for the increasing numbers of vendors on e-commerce.

 

2009: Collaboration with the Higher Educational Sector

Taobao University cooperate

The year 2009 was a year of invention. The training curriculum for enterprise-level e-commerce began to scale up, supplementing the original basic-level curriculum.

 

At the same time, Taobao University began to cooperate with 20 institutions of higher education in the Jiangsu-Zhejiang-Shanghai area.

 

Together they set up base areas for an internship. Simulating an actual work environment, they trained students in all the various aspects of the business, including photographing products, warehousing, logistics, and online transactions. The institutions working with Taobao University authorized credit for the courses.

 

For example, students of the Zhejiang Yiwu Institute of Commerce and Industry took courses over the holidays and then got credit for them. These base areas were well received by both teachers and students alike.

 

In the past, e-commerce training had been rather mysterious and unreal because students were not able to participate directly in e-commerce activities. 

 

Like people with any experience in the business know, the main thing to avoid is having overly high ambitions and not enough practical experience. One of the clearest examples involves packaging and logistics.

 

At the end of the day, there are three main determinations you have to make when it comes to packaging and shipping. First, how much material you use for the packaging. The more you save on materials, the lower your packaging costs.

 

Second, the toughness or durability of your parcels. Since goods get knocked around in the process of shipping, you want to avoid loss due to damage as much as possible. Third, the speed at which things get shipped.

 

Labor costs are a production cost that must not be overlooked nowadays. Because of this, the more efficient your shipping processes, and the lower the labor costs per time unit, the lower your production costs.

 

If our classmates grasp these three things and work accordingly, they will recognize where they need to improve their performance. They can target their problems more specifically and improve results.

 

Lessons such as this in packaging and logistics were given the name “the last kilometer.” They were intended to enable the classmates to move out of the campus and into the world—to go from theory to actual practice and transition from studying to working. In 2009, Taobao University trained some 150,000 students.

 

The Year of Reform: 2010

Taobao University began an e-commerce MBA program in 2010. As we all know, in terms of academic disciplines, the field of e-commerce is regarded as being an emerging industry, and in the early period of this new profession, there was no such thing as a master or a Ph.D. degree in the subject.

Taobao University reform

Most people entering the profession came from such fields as computer sciences, software engineering, electrical engineering, and so on. They were not at all versed in e-commerce itself and were not adequately specialized in this one topic.

 

The MBA program was set up to provide e-commerce entrepreneurs with systematic training in such things as enterprise management, human resources, operations, marketing, and planning.

 

This was aimed primarily at Taobao vendors whose businesses were already fairly well established.

 

Taobao’s business was becoming more impressive by the day, but the team inside Alibaba faced a dilemma. When the Taobao platform was just being started, a tremendous diversity of what was now regarded as the “old vendors” joined up, and these old-timers were now feeling a certain amount of pressure from the newcomers.

 

Back at the beginning, these old-timers cast their seeds into the fertile soil of Taobao, and it was a result of their efforts as well that this fertile soil became prosperous. In a sense, they had contributed to the founding of the new nation with their loyal service.

 

However, even as Taobao prospered, whether it was as a result of their own limited capabilities or for other reasons, these old-timers were no longer the most shining examples within their particular industries. On the contrary, they were facing considerable attack from the new e-commerce generation.

 

As designers of the platform, the Alibaba team now had to decide whether or not to have some kind of internal protection that opened a backdoor for these earlier operators.

 

The alternative was to remain impartial as a third-party provider. Alibaba decided to focus on setting up standardized operating procedures that could thereby preserve the long-term health of the ecosystem. In this choice between feelings and rationality, Alibaba did not allow itself to be swayed by emotion.

 

The team coolly and decisively opted for the latter choice—setting up more objective, complete, scientific operating procedures on the platform by which all shop owners, large and small, would be treated with the same respect as long as they abided by the rules.

 

Those who most understood how to do business would be the ones who obtained the greatest rate of flow.

 

Taobao University undertook another major reform in 2010, which was to bring an end to the era of free training. It began to charge for a portion of its curriculum. Meanwhile, the platform began to transition from being a cost center to becoming a profit center. The team has its reasons for coming to this decision.

 

First, the willingness of students to pay for training was the most direct way to judge the quality of the training. If the training was inadequate, no matter how inexpensive it might be, it would not result in growing demand in the market.

 

On the contrary, if the training was truly useful to e-commerce operators, they would be quite willing to pay for it because it improved their own results.

 

In taking in fees, the pressures on and motivations of Taobao University itself would change, and the drive to succeed would become stronger.

 

Second, the importance of the training link in the ecosystem of e-commerce operations affected not only the caliber of shop owners and their degree of professionalism but also the sound operations of the entire ecosystem.

 

If everything were free, the entire ecosystem would fail to draw in more participants. From a long-term perspective, this would be detrimental to the growth of the industry overall.

 

The Organization of Taobao University

Organization of Taobao University

How were the teachers themselves produced?

Once the precursor to Taobao University was set up in 2003, the training team continuously amassed experience and materials in the course of offline and online training. Eventually, these materials were organized into a full curriculum with sets of lectures, classroom materials, videos, and so on.

 

The first lecturers were sourced from among normal vendors on Taobao. Each lecturer was outstanding in his or her own operating category and had garnered considerable experience in the business.

 

Taobao University provided the training curriculum to these primary-level lecturers and asked them to become familiar with standardized training content so that they could become qualified.

 

Naturally, these people were not selected at random. They had to be excellent communicators, had to have a strong desire to share knowledge, and had to have a clean record in terms of not violating any business rules and regulations. Only then were they qualified to serve as Taobao lecturers.

 

In addition, Taobao University also provided opportunities for vendors who were confident of their own operating systems.

 

Any such vendors who wanted to be lecturers could bring their own internally generated materials and training systems to Alibaba.

 

They had their own case studies and course materials and often could be the source of new micro innovations. These lecturers were called enterprise-level guides, and they were mainly responsible for Internet-based courses aimed at enterprises.

 

How Were the Capabilities of Lecturers Evaluated?

Lecturers

Giving a person a fish is not as good as teaching him or her how to fish. Giving a person a fish is easier, however, than teaching a person how to fish. How does one judge whether or not a lecturer has what it takes?

 

Taobao University adopted a democratic method of evaluation. In their initial classes, potential lecturers would be graded by more experienced lecturers and older students.

 

If their marks were not up to a certain level, they would stop being qualified to do further teaching. Listen to the voices of the students and let the students decide on the teachers constituted the core philosophy of Taobao University.

 

How Were the Main Topics Selected?

After training courses were fully online, it was possible to see which courses were best received and then to select the ones that had received the highest number of hits. This allowed the university to discover which subjects were of most concern to shop owners.

 

Periodically, Taobao University would send questionnaires to students, asking for their opinions on courses. The students would suggest topics that might be needed and thereby elicit responses from lecturers willing to share their experience.

 

How to Incentivize Having Vendors Come to Share Their Experience?

Experience

Reading this, you might wonder why Taobao’s store owners would be willing to share their experiences. Weren’t they worried that they would starve as teachers if they taught everything they knew to their students?

 

On this subject, the members of the training team felt that openness and sharing were the bedrock of the Alibaba platform.

 

These tenets had been part of Alibaba’s core values from the beginning. Any entity that entered into the ecosystem of e-commerce could only make its own business prosper by a full personal understanding of these principles.

 

In addition, unlike the offline competition, the size of a shop or the location of a shop was not a limiting factor in online competition. Each brand had equal opportunity when it came to conditions under which it was to compete.

 

The desire to communicate on the part of each Taobao store was extremely strong. Especially when e-commerce was just beginning, each Taobao store had a strong sense of being “out there alone.”

 

If stores in the same line of business did not communicate with one another, they could easily begin to feel that they were alone out there in the fight.

 

As time went on, they would lose the urge to be competitive and innovative. As a result, these stores welcomed the Taobao University method of sharing and communicating.

 

People dealing in the same types of products, in particular, would form their own communication circle. Not only did this help to grow their own business, but it also enriched their lives —as they say, it killed two birds with one stone.

 

What’s more, online business often did not entail any direct conflict of interest. People did not try to hold back when they were sharing information. Over time, this created an extremely beneficial learning environment.

 

In point of fact, the team in the Vendors Selling Department had absolutely no experience themselves, but team members were highly acute in analyzing the characteristics of online business as well as the psychological needs of vendors.

 

They were able to create a comfortable and engaging environment for vendors. Naturally, Tao-U itself had its own set of methods by which to motivate vendors.

 

Such methods included the following:

1. The team allowed anyone to study for free if they themselves were willing to share their experience. This was a principle to be followed. Any lecturers who made particularly large contributions were given a course that was fee-based.

 

This was a bonus for voluntarily sharing their experience with others. As the English author Subona has said, “When two people give each other an apple, each one is left with just one apple in his hands.

Taobao University ideas

But when two people exchange ideas, each has the ideas of two people in his mind.” The more people share ideas, generally speaking, the greater is the harvest. Based on this incentive system, Taobao University attracted hundreds, if not thousands, of vendors into the system to serve as lecturers.

 

2. Offline training courses continued to be popular with vendors, and the reason was that, like CEO training in the MBA programs in China’s more famous schools such as Beijing University, Tsinghua College, Fudan College, and Jiao, people came there to study, but even more important, they used this platform to broaden their connections with the community of other CEOs.

 

They traded experiences, learned things, and made friends. Taobao University organized a similar kind of platform and provided the opportunity for vendors to get to know one another, all in the interest of spurring the growth of e-commerce.

 

3. Other than certain specialized courses for which a fee was charged, Taobao University did not charge vendors any miscellaneous fees at all, such as membership fees. To this day, the fee-based courses make up only 20 percent of the total. The concept of having a very low barrier to entry is quite intentional.

 

It provides an opportunity for those who truly intend to improve their operations. When the Vendors Training Department was set up, the various management costs in its budget were covered directly by the Alibaba Group.

 

After the higher-level courses began charging fees, any profits that were earned by this were put into operating costs.

 

From start to finish, Taobao University has been regarded as a transmitter of education. Its primary purpose has never been to make a profit. If enterprises are to grow, the heads of those enterprises must first grow themselves.

 

Maintaining this philosophy is what enabled Taobao University to motivate more and more vendors to participate enthusiastically in “circles” for common prosperity and growth.

 

The Primary Core Reason for the Success of Taobao University

Success of Taobao University

As the saying goes, when you do not have a gourd at hand to copy and you want to draw a gourd, all you can do is go one line at a time.

 

Without the slightest kind of blueprint to serve as a reference, the members of the Taobao University training team made the “soil” of the Taobao platform ever more fertile with each passing day.

 

From sowing seeds to watering to pruning to harvesting, Taobao University supported anything that would help the “seedlings” grow.

 

The thing team members look back on most proudly today is that they were unafraid to create new things. The team did not define any rules or regulations but instead allowed vendors to grow freely so that each member of the Taobao University team was willing to experiment and to make breakthroughs.

 

In this department, the key performance index (KPI) could not really be quantified. The efforts of the team led to an enrichment of the entire Taobao platform and its millions of vendors.

 

The team itself felt that Tao-U was a department created for the benefit of all, so the source of their happiness and sense of accomplishment came from the sound growth of each and every vendor.

 

From offline concentrated training to online direct transmission of courses, from selecting lecturers to establishing methods of evaluation and motivation mechanisms, in the early years, every step that Tao-U took was challenging to itself as well as an astonishing and courageous invention.

 

Naturally, just as Alibaba ran into turbulence and setbacks as it grew, Taobao University did not always have smooth sailing with the proverbial wind at its back.

 

Because the critical emphasis of each business period and each year was different, and because the energy of the team was, after all, limited, it was unavoidable that some projects had to be abandoned along the way or passed on to other enterprises.

 

For example, basic training is now performed by a specialized training company, whereas Taobao University focuses exclusively on enterprise training. Frequently, it is disappointing to have to give up something.

 

But the willingness of “Ali-people” to do this, to be selective over many years, to break out of constraints, and to constantly innovate, is precisely what has allowed them to stay at the forefront of the times. Their status as frontrunners has never changed. 

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