O2O (online to offline) or the birth of ambient retail in 2018!
Alibaba is only at the beginning of the ambiant retail and planned to initiate its auto vending machines in 2018 in collaboration with Ford, where the path to purchase will be absolutely seamless
As the new year unfolds, Alibaba has just invested in the furnishings chain Beijing Easyhome Furnishing. This announcement follows on from the Chinese giant’s keen ongoing interest in the real world. In under 2 years, Alibaba has acquired a 20% stake in the Chinese white goods distributor Suning and has launched its own chain of retail outlets through Hema Fresh, specialized infresh produce and totally digital (currently about thirty stores).
These acquisitions are proof that Alibaba is making every effort to have more and more interaction between its online marketplaces and the real world. Its 2.44 billion-euro investment in Sun Art Retail Group (the main operator of superstores in China, with Auchan as its majority shareholder) is the cornerstone of this strategy, with its 490 stores throughout China.
Alibaba confirms its intention (stated publicly at the Shoptalk Europe 2017 show) to combine bricks-and-mortar retail and e-commerce to offer a seamless experience based among other things on the Alipay Wallet and the different technological features this solution offers (AR, VR and biometrics, etc.).
Alibaba’s Europe manager Terry Von Bibra is convinced that its digital wallet ‘Alipay wallet’ will break codes with a smoother customer experience (fewer checkouts and more use of ‘scan pay and go’) and better interaction with products (use of AR, product recognition). In conclusion, the latter was keen to redefine the consumer: “The consumer does not care about online and offline,” ; “No consumer in the world gets up in the morning and says ‘I’m going to buy some shoes “online”.
On the other side of the Atlantic, the appetite for the real work is also particularly strong. One example of the takeover of the American food retailer Whole Foods (11.6 billion euros) by Amazon, finalized at the end of August 2017.
Conversely, Walmart has taken on the world of e-commerce with four acquisitions of online fashion sites, Bonobos, ModCloth, ShoeBuy and Outdoor MooseJaw, and has acquired a stake in JD, Alibaba’s main competitor in e-commerce.
The blending of these 2 worlds appears to be the key issue for the giants of commerce in 2018!
To illustrate the power of Alibaba, in November 2018 the group generated sales of 25 billion dollars in just 24 hours on the Single Day. Through the massive mining of customer data on its platforms, Alibaba wants to develop customized services in its bricks-and-mortar stores.
According to Easyhome CEO and Alibaba partner Wan Linpeng, « mobile payment, smart stores, e-commerce platform, smart logistics and consumption finance will create a new model for home products retail and lead the future development of China’s home products industry. Easyhome will also become a big data and “New Retail”-driven enterprise that are customer-oriented’.”
While Hema Fresh’s slogan “Easy Pay, Easy Select, Easy Enjoy” is prevalent thanks to the Alipay application, this is just the beginning of ambient retail as advocated by the Chinese giant.
The latter has planned to initiate its auto vending machines in 2018 in collaboration with Ford, where the path to purchase will be absolutely seamless. On Alibaba’s mobile app Taobao, the consumer scans a vehicle (image recognition) that interests him in the street.
The application identifies the vehicle (model, make), asks the consumer to add available options (colour, bodywork, etc.) and if the latter (after facial recognition) has a convincing score (based on the many transactions on the Alibaba platform) he is entitled to arrange an appointment to test-drive the vehicle with a dealer of his choosing.
On the arranged day, the user goes to the vending machine called Tmall Auto Vending Machine. Facial recognition now comes into play, by releasing the reserved car, which can be used for three days. Automated purchase for pleasure is becoming a reality.
Alibaba is thus pre-empting all the gaps in our life moments under the guise of Artificial Intelligence. The Jack MA retail chain wants to make our consumer life path smoother and totally ambient. On the basis of its all-powerful platform (inexhaustible data source), Alibaba combines all the components of a transparent, ubiquitous and seamless purchasing process in the shortest possible time! It is all the more edifying as Alibaba is asserting its digital ID and reinforcing authentication through advances in facial recognition! O2O, or the art of extending one’s ecosystem into our everyday life.