Taobao village

Taobao villages are rural Chinese villages where the local economy has developed to focus extensively on e-commerce via the Taobao online retail platform. Taobao villages have contributed to economic development and rural revitalization in China.

Definition
Taobao villages are rural Chinese villages where the local economy has developed to focus extensively on e-commerce via the Taobao platform. Alibaba's research division defines Taobao villages as those in which (1) businesses are located in an administrative village in a rural area, (2) the village's annual e-commerce revenues exceed RMB 10 million, and (3) the village has either an excess of 100 active online shops or active online shops account for more than 10% of village households.

Overview
Taobao villages are concentrated in China's coastal regions, particularly in Zhejiang province (which is where Alibaba, which operated the Taobao platform, is located). Zhijiang City in Hubei province also has a significant cluster of Taobao villages. As of at least 2023, Taobao villages are increasingly developed in inland parts of China.

Taobao villages first began appearing in 2009. By 2013, twenty Taobao villages existed in China. In 2020, 5,425 such villages existed, generating total annual revenue of RMB 1,000 billion via 29,600 active online shops.

Impact
The geographical clustering of e-commerce businesses in Taobao villages have mutual benefits for these businesses, as opposed to when they operate in greater isolation. Geographic clustering of e-commerce businesses results in labor market pooling, facilitates knowledge exchange, and allows for increased labor market pooling. Increased economic activities also can attract government-subsidized capital.

Because Taobao villages have increased the incomes or rural people and entrepreneurship in rural China, Taobao villages have become a component of rural revitalization strategies.