China's famous search engine Baidu will close its e-commerce unit youa.com by the end of April and transfer related business to its partners, the "Nanfang Daily" reports.
On March 31, youa.com issued an announcement about its closure, marking the failure of Baidu's three-year strategy to make it the largest e-commerce site of its kind.
As early as 2007, Baidu said it would enter the field of e-commerce. In October 2008, the search engine giant launched its own online shopping website youa.com and pledged to surpass Taobao, a leading online sales website in China, within three years.
Although youa.com had more than 4 million clicks on the day it debuted when nearly 2 million items went on sale, the growth of the consumer-to-consumer (C2C) website had not gone according to plan in the years that followed.
Baidu had teamed up with Rakuten, Japan's biggest e-commerce company, to open a new online shopping mall in January 2010, which was considered an attempt to modify Baidu's previous strategy.
In March the same year, Li Mingyuan, the head and founder of youa.com, quit. His successor, Cai Hu, began to shift the core business from selling to offering information about group buying and coupons to clients, signaling Baidu's new focus would be business-to-consumer e-commerce.
Baidu plans to completely transform youa.com by transferring its online shopping mall business to its partners, including Rakuten and yaodian100.com.
The news report quoted an anonymous Baidu executive who said the modification was aimed at finding a better model to combine search services and e-commerce. The executive also said the Nasdaq-listed company was developing a new platform so it could eventually return to the e-commerce market.
The report also cited some industry insiders who said China's consumer-to-consumer e-commerce sector was dominated by Taobao, which holds nearly 80 percent share of the market, so that competitors were unable to challenge it.
