UBS Sees Potential Monetization Upside with Alimama's New Ad Product Launch

Alimama, a BABA subsidiary, introduced "Sitewide Promotion," a new advertising product integrating organic and paid traffic, aimed at expanding the site-wide traffic pool.

Leveraging AI and Alimama's large model for advertising (LMA), the product simplifies operations and offers higher ROI visibility for merchants on Taobao and Tmall.

UBS believes "Sitewide Promotion" addresses merchants' key pain points, potentially increasing paying penetration and monetization, and enhancing profitability for BABA.

The broker predicts the new product will contribute to the re-acceleration of Taobao and Tmall's growth and could be a significant driver of customer management revenue (CMR) growth.

UBS maintains a US Share Buy rating for BABA, with a target price of US$105, anticipating investor appreciation of the company's growth prospects.