Study On Internet Finance Industries From The Pespective Of Business Model Innovation

Internet Finance is the latest practice of financial innovation in China, which refers to online financial services such as payment, funding, insurance and investment supplied by e-commerce firms. Compared with the traditional finance industries, internet finance has witnessed new products, service patterns, and market players. Most importantly, internet finance has brought about a new business model for e-commerce companies. This paper exactly attempts to analyze internet finance industries from the perspective of business model innovation.Taking business model innovation as the background of researches, the paper first reviewed business model changes over the past ten years, showcasing the prominence of the model of internet finance. One step further, in order to estimate the influences of business model innovation on company development, the paper borrowed the entropy model to explain the mechanism.This paper divides internet finance into two industries—third-party payment business and internet funding, based on the status quo of China. Furthermore, the paper has thoroughly analyzed the market shares, competition structures, and industry chains of the two industries. Results as following have been found out:(1) The two industries are developing at a fast speed, but the concentration rates are very high, namely small companies compete fiercely with each other;(2) Scale economy effect and product differentiation are two entrance blocks of the industries;(3) Banks are aggressively trying to enter the industries, which becomes a challenge for big companies but a chance of cooperation for small companies. This paper also investigated on the business model innovation based on the analysis of industry value chains, on the aspects of value creation, value maintain, and value realization.Finally, the paper conducted a case study of Alibaba Finance, pointing out its unique business model of "ecology system+open platform" and deciphering how the new model affects the traditional supermarket model and the present finance industries.