Alibaba’s new model melds online and offline business
Alibaba Group has launched what it calls the age of “New Retail”, which the online giant says will replace today’s “e-commerce”.
New Retail will see the distinction between online and offline retail businesses soon disappear, the Chinese conglomerate said. The company is testing the new model at Hema, one of its New Retail brands, in Hangzhou, Shanghai, Beijing and other large Chinese cities.
At Hema, a premium-quality supermarket front with a wide range of home delivery services, consumers living within a 3-kilometre radius can get home delivery of fresh food items, fruit (including Thai durians), vegetables and other daily necessities within 30 minutes of placing an order.
The service is part of a so-called 3-in-1 retail experience that covers tech-driven online delivery, in-store purchases and in-store consumption.
Big data and cloud computing are among the key infrastructures supporting the use of artificial intelligence where both online and offline platforms converge through mobile and enterprise technology.
For example, consumers can visit the Hema intelligent supermarket when they wish, or may prefer to stay home on a rainy day and order anything, including fresh seafood like king crabs imported from Alaska, have them cooked in a preferred style and home-delivered.
The price of imported seafood in this instance is competitive largely because of Alibaba’s global reach for imported products, which are bought directly from suppliers without layers of middlemen.
At present, more than 50 Hema branches are operational in China where mobile payment is a key driver of the Chinese digital economy that has been expanding rapidly into foreign markets, such as Thailand.
Alipay, part of Alibaba Group’s Ant Financial, is helping to turn China into a cashless society as mobile phones and apps become the predominant payment platform.
In Thailand, Alipay’s merchant network now covers hundreds of thousands of locations across the country, especially in tourist areas, as a huge number of the nearly 10 million Chinese visitors to Thailand each year use such a payment platform.
In addition, Ant Financial and Thailand’s CP Group have jointly launched the TrueMoney Wallet to provide payment and other financial services using technology to promote a cashless society here.
For e-commerce customers, Lazada, also majority-owned by Alibaba Group, is currently the front-runner in the Thai market.
On a global scale, Alibaba is the world’s largest e-commerce retailer in terms of gross merchandise value with 552 million active consumers, as of March this year, mainly on its giant Taobao and Tmall platforms for Chinese consumers.
The group’s vision is to build an infrastructure where customers can meet, work and live, and where commercial and social interactions can take place.
The group’s eco-system encompasses retail commerce, consumer service, wholesale commerce, digital media and entertainment as well as new innovative initiatives supported by logistic, payment, financial and cloud computing services.
James Xu, deputy chief representative of Alibaba Group’s Thailand market, said the group had already signed four MoUs with the Thai government to implement a wide range of collaborative programmes.
The group’s eco-system will be used to help leverage the Thailand 4.0 initiative with a focus on the Eastern Economic Corridor.
In addition, Alibaba will help develop Thai small and medium enterprises (SMEs), farmers and financial services.
In the tourism sector, Fliggy, Alibaba’s online travel service platform, is working with Alipay and Thai tourism authorities to attract a new generation of Chinese tourists to Thailand and offer them a cashless travel experience.