Summary of Key Points
Both Alibaba Health and JD Health started around the same time in 2011. Initially, Alibaba had a comprehensive advantage in terms of qualifications, traffic, and revenue. However, today, Alibaba Health's revenue and profits are only half and one-third of JD Health's, respectively. One of the key reasons for this gap is the difference in organization and strategy: Alibaba Health has had four CEOs in ten years, with its strategy frequently shifting; in contrast, JD Health has had a stable management team that has always focused on "selling medical products." Additionally, Ant Health, a subsidiary of Alibaba, has developed its own business, creating competition with Alibaba Health and further dispersing resources. This highlights the fundamental reality of profitability in the internet healthcare sector: it comes from selling products that can directly impact health, such as medicines and health supplements, rather than providing online consultation services.
I. The Former Leader: Alibaba Health Had a Much Better Start
Alibaba Health had several advantages at the beginning:
1. One-year lead in qualifications: In 2013, Alibaba obtained the country's first pilot license for online pharmaceutical sales through the acquisition of CITIC 21st Century, while JD Health didn't get its fifth license until December 2014.
2. 2.7 times more traffic: In 2017, Taobao had 460 million monthly active users, nearly three times more than JD Health's 170 million users.
3. Earlier revenue leadership: In 2014, Alibaba Health (Tmall Medicine Hall) generated 150 million yuan in revenue with a GMV of 3.7 billion yuan; JD Health's revenue was around 100 million yuan that same year, and it even declined after breaking up with its partner, Jiuzhoutong.
However, these advantages did not translate into a long-term lead.
II. Alibaba Health's "Strategic Drift": Four CEOs, Four Changes in Direction
Alibaba Health has had four CEOs in ten years, each with a different strategy, leading to resource dispersion and confusion:
1. Wang Lei (2014-2017): Focus on O2O (online consultation + offline pharmacy services)
They tried to integrate online doctor consultations with offline pharmacy pickup but faced opposition from the Taobao team when trying to merge the Tmall Medicine business into Alibaba Health.
2. Shen Difan (2017-2020): Emphasize product sales (O2C)
They merged Tmall's health supplements, medical devices, and pharmaceutical businesses into Alibaba Health, which led to some revenue growth but did not address the core issue.
3. Zhu Shunyan (2020-2023): Shift to "medical services"
They renamed the Alibaba Health app to "Yilu," acquired a traditional Chinese medicine platform, and proposed a grand strategy of "cloud hospitals, cloud pharmacies, and cloud infrastructure." However, when marketing stopped, the app's daily active users plummeted from a peak to just 100,000. During this period, JD Health's revenue doubled compared to Alibaba Health's.
4. Shen Difan's Return (2023-present): Back to product sales
They discontinued the Yilu app and relied again on Taobao's traffic, stating that AI products would not be commercialized for three years—returning to the basic logic of selling products.
III. JD Health's Stability: Stable Management, Focused on One Goal
JD Health has had only three CEOs in ten years, all from within the company, with a consistent strategy of focusing on "selling medical products":
1. Xin Lijun (2016-2021): Laid the foundation for its own pharmacy business
He took charge of JD Pharmacy in 2016 and led the separation of JD Health in 2019, with the goal of expanding the pharmaceutical retail business.
2. Jin Enlin (2021-2025): Corrected course when needed
Although they briefly tried a more ambitious "medical closed-loop" approach, they quickly cut back on non-core businesses and returned to focusing on product sales.
3. Cao Dong (2025-present): Continued to focus on efficiency
They emphasized the importance of cost-effectiveness and continued to invest in product sales.
Stable management has allowed JD Health's strategy to remain consistent, gradually building a larger scale in product sales, resulting in steady growth in revenue and profits.
IV. Internal Competition within Alibaba: Ant Health Competing with Alibaba Health
Alibaba Health is not only facing external competition but also internal competition from Ant Group:
Ant Health began to take back the health business operations from Alipay in 2019, acquired Haodf Online in 2024 to obtain doctor resources, and opened its own pharmacies to sell medicines. It also developed AI models (similar to Alibaba Health's "cloud infrastructure" initiative). In 2025, Ant Health was upgraded to a separate business unit, operating independently from Alibaba Health. This not only disperses resources but also leads to competition between the two companies.
Alipay has 700 million users with medical insurance accounts, and Ant Group prefers to use these resources internally rather than sharing them with Alibaba Health, reflecting the lack of organizational unity within the Alibaba ecosystem.
V. The Reality of Internet Healthcare: Simple Selling Is the Key to Profit
The so-called "medical closed-loop" (medical consultation, testing, diagnosis, and medication) is more of a marketing concept; the real moneymaker is selling products:
1. 83% of JD Health's revenue comes from product sales: Medicines account for 40%, health supplements for 35%, and medical devices (such as blood pressure and blood glucose monitors) for 25%—essentially, it operates like an online pharmacy.
2. Lessons from other companies: Chunyu Doctor was one of the early pioneers in online consultations, with a valuation of over $1 billion, but its user base plummeted after implementing membership fees, leading to a low-price acquisition. ByteDance's Xiaohé Health also discontinued its app because users were unwilling to pay for consultations.
Consumers are more willing to pay for products that solve their problems directly (such as cold medicines and blood glucose monitors) rather than for online consultations (unless they need a prescription). Alibaba Health took a detour before returning to its core business of selling products, while JD Health has always focused on this, which is why the gap between the two companies is widening.
In Conclusion
The business world rewards those who "persist in doing the right thing," not those who first see the answer. Despite a better start, Alibaba Health's frequent strategic changes and internal divisions have not been enough to overcome JD Health's steady progress. The essence of internet healthcare is simply operating an online pharmacy with additional medical services—don't make it too complicated.