Alibaba’s reveals ambitious O2O retail plan

Screenshot: Chinese OnlineShop


The continually rising market turnover of B2B e-commerce over recent years has attracted wide attention from the retail sector. Against this context, Alibaba has just launched the “” to seize the initiative and create a new paradigm for the B2B e-commerce market.

Simply put, the “” puts together buying resources for a number of small retailers, in order to get great discounts that would otherwise be granted only to large customers. It helps secure good-quality and economic sources of supply while saving the trouble and costs of advertising and searching. It can significantly change the landscape in traditional offline retail sector that features increasing prices and diminishing profits when goods are passed through multiple distribution layers. Higher retail efficiency means improved profit margins for retailers. With the Internet, a virtual chain retailing format is finally established, representing a “chain” convenience store purchase model.

With good market sense, Alibaba has firmly captured the opportunities posed by diminishing profits of physical stores and closer affinity of retailers to end consumers. In response to the latter, Alibaba’s “” has initiated a “City Partner” program, to engage as many offline retailers as possible in cities across China. These retailers will become Alibaba’s own customers, who can enjoy Alibaba’s global quality sources and extensive resources to achieve “online one-stop purchase, offline exclusive services”. According to Alibaba’s official forecast, as at March 2016, City Partner program has covered 300,000 people in each city, with a service population of 150 million.

This year’s Qixi Festival - the Chinese Valentine's Day - has witnessed the arrival of “Taobao Convenience Store”, an online platform jointly presented by Alibaba’s “” and “Mobile Taobao”. By integrating strengths of both “” and Alibaba’s own logistics chain “Cainiao”, “Taobao Convenience Store” has adopted the mode of franchised retail outlet plus supply chain and managed to deliver good quality products to 200,000 offline retail stores at inexpensive prices by cutting out middlemen and selling direct. It carefully selects the best suppliers on a “one district, one convenience store” basis to ensure timely and efficient services for users. Whether in business districts or residential areas, “Taobao Convenience Store” outlets are densely located. So, consumers can freely select what they want via “Taobao Convenience Store” on “Taobao” homepage by just a simple click, and rest assured that they will receive genuine goods from genuine sources within one hour after order.

More convenient services stimulate higher demand for Alibaba's “” stores from online shoppers. Meanwhile, supporting logistics services also benefit retailers, who in the past could only serve offline consumers and now are able to meet both offline and online service requests, resulting in a wider customer base, increased profitability and further growth potential.

Although newly launched, Alibaba's “” is playing an increasingly important role in promoting urban retail network and an upgrade of urban residents’ consumption patterns. With reliable e-technology, substantial e-commerce experience and sincere services, “” will bring us more surprises in the future.

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