A First Look Into Alibaba’s Vision For Future Retail

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A First Look Into Alibaba’s Vision For Future Retail
November 10, 2017
An Alibaba smart pop-up store built for the 11.11 shopping festival. Yue Wang - Forbes

 

Singles' Day, an annual shopping day Chinese e-commerce giant Alibaba invented in 2009, won’t just be about online discounts this year -- The company is expanding the shopping bonanza into the physical space for fresh growth, setting up more than 1,000 smart pop-up stores across the country to build hype around the day. The stores also offer an glimpse into Alibaba's version of new retail, which involves using technology to upgrade China’s $4.9 trillion retail market.

 

To see what Alibaba has in mind for the future of retail, I visited one smart pop-up store in Beijing.

The store, built especially for Singles Day, is located in Beijing’s trendy Sanlitun area, a place best known for an upscale shopping environment and a bar street.

 

It is divided into five sections – kitchen, study, bedroom, bathroom and living room, which all host connected products that can be voice activated or remotely controlled by smartphones. Consumers can scan QR codes with their phones for product information or be directed to Alibaba’s online malls for purchases.

Consumers browse products inside the kitchen section at Alibaba' smart pop-up store. Yue Wang - Forbes

 

The store doesn’t just host domestic brands. Amazon’s Kindle e-reader is displayed in the study section, as part of the theme for a connected working environment.

By scanning the QR code displayed next to the Kindle device, people can buy directly from Alibaba's Tmall shopping site. Yue Wang - Forbes

 

The most interesting devices are placed in the living room. Alibaba envisions a future where everything is controlled through its $75 Echo-like smart speaker the Tmall Genie, which can switch television programs, pay your smartphone bills or play music just like its western counterparts.

A smart table that reads the health of plants placed on its top. Yue Wang - Forbes

 

The living room also features products that aren’t available in the mass market. This smart tea table, for example, can tell whether a plant placed on top needs to be watered and offer suggestions accordingly.

After scanning this sign via Alibaba's Taobao app, consumers can play an interactive game called Hongbao Rain. Yue Wang - Forbes

 

There are also interactive games throughout the store. After scanning this sign with Alibaba’s Taobao app, consumers can play an augmented reality game called Hongbao Rain, which superimposes virtual red envelopes containing small amounts of cash onto the real world. After catching each red envelope, consumers get to keep the money.

 

While the store is just for Singles Day, Alibaba seeks to use this shopping bonanza to promote the new retail concept, which is enabled by the data troves collected from both offline and digital stores. Alibaba Chief Executive Daniel Zhang has envisioned a future where retailers know their customers so well that they can recommend products via store shelves and smartphone apps at the same time, and deliver them together to customers’ doorsteps within 30 minutes so shoppers don’t have to carry bags to their next destination.

Customers browse fresh seafood at a Hema supermarket. Photo courtesy : Hema Xiansheng

 

The company already made some progress by licensing the Hema retail model to other retail companies. Still, it has some way to go – Analysts say that China’s fragmented retail landscape and concerns over Hema’s profitability stand in Alibaba’s way. But connecting online with offline is the only way forward as both markets face limited growth potential on their own.

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