Alibaba Buys Stake in Weibo
China’s biggest e-commerce company Alibaba has bought an 18% stake in the country’s most popular micro-blogging platform, Sina Weibo.
The deal, worth $586m, is Alibaba’s first big move into selling advertising on China’s social networks. It is expected to help Alibaba drive traffic from Weibo – China’s equivalent to Twitter – over to Alibaba’s Taobao Marketplace.
The two companies said the partnership would generate up to $380m in advertising and social commerce revenues over the next three years.
"We believe that this strategic alliance helps to create a stronger Weibo,” said Jack Ma, chairman of Alibaba. “It affirms our view of the vitality and importance of social media in unleashing value in e-commerce activities.”
The news comes as growth in China’s internet market shows no slowing, with the country’s total online sales expected to reach $356.1bn by 2016. As the market matures social commerce is seen as a key driver of future revenue.