Zhang defined e-commerce in the mobile internet age. He joined Alibaba in 2007 and Jack Ma appointed him chairman of the group in 2019.
By WU Yangyu, XU Shiqi
Alibaba announced on June 20 that chairman and CEO Daniel Zhang will step down in September. He will continue to head the cloud computing business, one of the six units the tech giants split into this March. Joseph Tsai and Eddie Yongming Wu, two executives that have been with Alibaba since its founding years, will succeed him as chairman and CEO.
Alibaba said last month that cloud computing will be spun off from the group in the next 12 months and seek an IPO independently.
Daniel Zhang shaped Alibaba as we know it today and defined China’s e-commerce in the mobile internet age. He joined Alibaba in 2007 from a gaming company as Taobao’s CFO and became its COO two years later.
Taobao, at that time, was a meeting place for small sellers and consumers, but Zhang invited large brands in and resuscitated the business-to-consumer arm, now known as Tmall. He invented the Single Day sales, and in a less-known but equally significant move, defied a boycott and raised merchant fees to sift out fakes and frauds, paving the way for Taobao’s rise in the next decade.
In 2013, Zhang was appointed COO of Alibaba Group. He convinced the management to “go all in on mobile internet.” By 2015, 289 million people logged into Alibaba sites every month, a third of all smartphone users in China.
Zhang took over from founder Jack Ma and became CEO of Alibaba in 2015. The group, under his helm, expanded in almost every realm in everyday life from cloud computing to food delivery. To move new projects along more quickly, he came up with the "data middle office" to aggregate and process intelligence from all fronts. The structure has since been adopted by all big tech companies in China.
Jack Ma called Zhang “indisputably the best CEO in China” and appointed him chairman of the group in 2019, at Alibaba’s 20-year anniversary. Alibaba was in a 13-quarter streak of robust growth and its shares were on its way to the US$319 peak in October 2020. But in business, the only thing that is constant is change, and change came right afterward.
In November 2020, regulators called a halt to Ant Group’s blockbuster IPO at the eleventh hour. The next year, Alibaba was fined US$2.8 billion in an antitrust suit. Meanwhile, its e-commerce dominance was eroded by aggressive upstarts Douyin and Pinduoduo.
Zhang pushed forward a series of organizational reforms in 2021 to give each business unit more leeway. In a more drastic move, in March, Alibaba split into six units. Each will be independently run and can seek funding.
The split up is seen as a response to the new regulatory and business regime. Given its significance, however, both Ma and Zhang are tight-lipped. Jack Ma, after a year of absence from public view, reappeared in March. He is reported to have met with senior managers of Taobao and Tmall in May and told them to refocus on users and on the very basics of the internet.
In his rare recent appearances, Zhang has only talked about AI and large language models. The open letter announcing his job change was polite but not informative to nosy Alibaba followers. The split-up, he said, is going smoothly. He then thanked his colleagues and said he looked forward to a new journey.
