David Wei: The Internet as a New Platform for Commerce
HONG KONG, June 27, 2013 — In a presentation at the Asia Society Hong Kong Center, David Wei, Founder and Chairman of Vision Knight Capital and former CEO of Alibaba.com Limited, analyzed the emergence of the Internet as a new platform for commerce and explained how e-commerce may soon replace the traditional marketplace.
Wei began his presentation with statistics highlighting China's massive growth in Internet use in comparison to the U.S. "The number of Internet and smartphone users has been growing rapidly in recent years and today's China PC internet users are twice as many as those in the States [and] China took eight years to surpass the U.S. in PC Internet user number," Wei said.
The Internet has become a powerful medium for commerce, as it offers "a new shopping experience, with our orders delivered to our doorstep," Wei explained. He saw immense potential in the Internet as a new platform for commerce in China. "China has the strongest e-commerce growth in the world, with China's online retail growth as high as 19 times within five years."
"The Internet has drastically changed the cost structures of businesses," Wei said. As the cost of an Internet domain is far cheaper than physical retail space, Wei predicted that the online retail market would eventually supersede the traditional retail market. He suggested that while standardized products which can be digitalized, such as music and DVDs could be and to a large extent have been replaced by Internet alternatives, products with service experience can never be replaced.
"Wedding photography is not just about photographs. It's the experience. Although photos can be digitalized ... the wedding photography service cannot be digitalized," Wei said. These customized and unique services businesses offers will never be substituted by e-commerce.
"Make yourself commerce-E and prioritize commerce first. Look at your existing business bottleneck and think of an E-solution." Wei suggested traditional businesses leverage the Internet to change their existing business model.
Wei asserted, "The clock is ticking. It's time for you to reshape your business. The time to adapt the new Internet population is not that long."
Reported by Pauline Tsang
Video: Watch the complete talk (1 hr., 17 min.)