Taobao, if you haven’t heard of it, is China’s dominant online shopping website.

taobaoTo not have heard of it, however, you must be avoiding all China news; it is such an element of modern life and society. You must be avoiding all (China) business reporting, too, for the company that runs Taobao is Jack Ma’s Alibaba which just recently had its IPO on Wall Street – and it was the largest ever.

The topic that interests me about Taobao, and that has some connection with the interests on this blog, is not its economic valuation, however. Rather, it is the interplay of technological development(s) and social dynamics one can observe in and around it.

The main theme often seen and regularly reported on is simply that Taobao is a big online shopping platform which brings together buyers and sellers from big companies – Costco recently ‘entered the Chinese market’, after a fashion, by opening a Taobao store – to small boutiques, from rural farmers offering some of their produce, to high-end brands selling prét-a-porter, with many a store selling ‘surplus’ brand production, often minus the label, and some label-enhanced but non-brand production thrown in for good (or bad, fake) measure.

And so, the offerings range from the normal and usual – one can even order take-out food on Taobao – to the extraordinary and dubiously legal, from the pricy high-end to the low-price fake, grey import… you name it. Even plastinated corpses had been spotted.

It has garnered quite some attention just how many diverse things are on offer, but it’s not just the products but rather the hidden patterns that are so fascinating. From extraordinary production to digital farming and from a social media marketplace to a globe-spanning recommendation network, Taobao is really-existing cyberpunk.

Uniquely Rural Sales Propositions

One case in point: Farmers and the unique selling proposition of highly-local produce.

China has many a local food product, many a poor farmer, quite some interest in typical foods of particular regions, and generally few chances for farmers to somehow advertise their local products as something typical and high-value rather than something that just isn’t present on the marketplace and therefore not valued.
There has been a rise in interest in products coming to the buyer not anonymously, but directly from the farmer. Maybe preferably, a poorer local farmer who one can talk to and see if that person is likely to use whatever chemicals they can get their hands on in order to grow more and bigger produce or not. After all the food scandals that China has seen, this seems like a possible way to avoid adulterated food.

So, some savvy-enough farmers present themselves and what they have to offer, in text and pictures, on Taobao. I found the ShanHujiao this way, a peppery spice I had never hitherto heard of and would (were it not for Taobao) have had to go to rural Western Hunan or similar areas to ever discover (although its oil and some use of it seems common enough – when looking on Taobao, at least). That was not even grown, it was collected in the mountains… and I can tell because I saw the pictures and spoke with the seller.

Taobao – i.e., Alibaba – is looking to expand still further with this… and of course, to get to more customers as well.

Trust Me, I’m Rated on Taobao

Case two: One big problem intimately related to issues like food safety is the opportunism and lack of trust that is, unfortunately, often to be found in China.
It isn’t just to be found, it can seem quite necessary when so many people just seem out to make whatever they can, as quickly as possible, before either they are left behind or the times change and make it impossible to make it like that any longer.

Taobao isn’t just a collection of virtual stores where you shop and hope to not be ripped off, however.

For one, there is the option to chat with the sellers, and perhaps haggle about the price or at least for the cost of shipping to be included (if it isn’t anyways). That way, one can get an impression of how involved that seller is and how trustworthy that person at least sounds.

Secondly, there are recommendations and reviews which are an integral part of the shopping.

A buyer has to (well, is expected to) at least acknowledge that the product was received and is satisfactory; within a certain time, refunds and reclamations are typically (depending on store) possible – or there would be loud complaints that one would notice.

One finds displays of how long a store (and a buyer, by the way) has been on Taobao, what volume and value of sales they have made, and what ratings they have received. It is possible, and some stores try, to gain fake high rankings (e.g. offering products for a few cents, letting friends buy them and give good ratings, driving up supposed ratings and sales volumes), but it is also possible, and not all that difficult, to recognize when this was done.

It is rather reminiscent of the “darknet” that Daniel Suarez describes in his novel Freedom™, where its members rate each other based on their interactions and thus have a way of recognizing who else is a member and in what standing.

Can’t Find It? I’ll Get It

This techno-sociality mediated by Taobao extends further, for one cannot just find close to any product on Taobao, one can also find someone to find what is not to be found on Taobao by way of this marketplace.

There are people all over the world who offer to work as intermediary, purchasing and shipping what could otherwise not be purchased online because of international shipping restrictions (not the illegal kind but simply the many US webstores not willing or permitted to sell outside of the USA) or because interest just isn’t so high that the product is offered internationally. Of course, there are also attempts of getting around customs duties by having something shipped from such a ‘friend’ and declared as being of a value below that which makes the product incur duties and taxes… (and with China’s “luxury tax” on so many imported goods, making many – if not most – higher-value goods more expensive in China than even in Europe, this is quite a motivation for getting such things from abroad, at the very least from Hong Kong).

Finally, aside from this import of Taobao on social interaction, it is necessary to get back to economic considerations (and their social implications).

Ghost Malls, Virtual Shoppers

In spite of the allure of the large Chinese market, many products cannot be found in stores, even in Beijing. Japanese food, for example, is not unpopular, but an online store just has it easier finding enough buyers (and lower overhead) than a brick-and-mortar store.

For many products that can be found, such as electronics, there is no good way for one stall in an electronics mall of differentiating itself from the dozens of others offering the same selection of the same products. The Zhongguancun electronics malls are half empty and a cesspool of aggressive salespeople trying to push potential customers their way. It’s much easier and more comfortable to just make such a purchase online – and Taobao offers some of the best prices and best ways of checking out products, perks, and store ratings.

Not only electronics malls are in trouble, there are many ‘ghost malls’ that seem to have been built just because malls were all the rage and a property developer’s easy plan to a higher valuation for their construction. Stores, however, there are few – and the same as in any other mall – and customers, even fewer.

No wonder, again, when the comfort of Taobao wins.

Here, a side-effect and enabler of Taobao has to be mentioned: No small thanks to this marketplace, express delivery companies in China have developed quite the service network across quite a bit of China. Rural areas are still under-serviced, but even in second- and sometimes third-tier cities, there will be at least some express services.
The prices are generally, for someone used to US or European postage especially, low; the delivery can get things across China in a day, nonetheless (depending on service, of course).
This, of course, greatly contributes to the success of Taobao (and other online shopping sites), as well.

On this day, yet another social influence of Taobao has to be mentioned: China keeps looking towards domestic consumption as the future of its economy – and on the shopping extravaganza that is 11-11’s “Single’s Day,” set to break sales volume records again, it looks as if this marketplace may be the single biggest and best driver of said consumption.
Among the younger generation, certainly, it is one of the – if not the most – hotly anticipated days.

So, it may not only be that, as John Stewart noted, “The Communists Just Beat Us at Capitalism.”

There’s even more happening.

Taobao, 11-11