Alibaba's aggressive mobile growth continues

Alibaba (NYSE:BABA) continues to draw more users to its mobile business as it embarks on a battle with a competitive mobile platform and tries to grow transactions made with the site's mobile wallet.

The Chinese e-commerce giant reported that 240 million people used its Alipay mobile wallet to send virtual red envelopes to friends and family in the lead up to the lunar new year.

Alipay was competing with Tencent's WeChat mobile messenger in what was dubbed the "red envelope war." The competition to draw more users to each mobile service was based on the Chinese tradition of sending money in red envelopes to celebrate the eve of the lunar new year on Feb. 18.

Alipay didn't actually win that particular battle (WeChat reported 1 billion virtual red envelopes were sent using its messenger), but that isn't likely to alarm the retailer after the leap its mobile traffic made in the fourth quarter.

Executive Vice Chairman Joseph Tsai had some difficult battles to fight on Alibaba's fourth quarter earnings call, defending the company against allegations of bribery, fraudulent merchandise and answering for lower than expected revenue, despite a 40 percent increase to $4.22 billion. The undeniable bright spot for the company was mobile.

The retailer reported 53 billion transactions on mobile during the quarter, making mobile gross merchandise growth (GMV) 42 percent of Alibaba's total GMV, an increase of 213 percent over the prior year. Compared to the previous quarter, Tsai said the company grew its monthly active users by 48 million to a total of 265 million, a 22 percent jump from the previous quarter and 95 percent year-over-year growth.

Altogether, Alibaba referred to mobile 70 times during its earnings call, and made no secret that m-commerce is the priority moving forward.

"We believe that the continued trend towards mobile provides us with a unique advantage to deliver a better consumer experience, as well as more value to merchants, because mobile users shop more frequently and we can serve them more targeted search results," Tsai said. "We believe the increasing use of our mobile apps will field significant future growth in our China commerce retail business."

The same is true in the United States, where shoppers increasingly prefer shopping via apps to desktop experiences, even on the biggest shopping days of the year.

For more:
-See this PYMENTS.com story
-See this Financial Times story

Related stories:
Neiman Marcus launches mobile wallet
Retailers shift focus away from apps to optimization
26% of online transactions now on mobile
Google reportedly in talks with struggling Softcard
Mobile is making inroads in grocery

Suggested Articles

Costco changes up its menu items, and Alibaba and Guess partner for a physical store.

Janey Whiteside, Walmart's new chief customer officer, is well acquainted with the importance of customer service in modern retail.

Whole Foods will offer deals on Amazon's Prime Day, and tariffs against China are causing pricing hikes.