Welcome to the new retail revolution that is sweeping China, the world’s biggest consumer market.
The term “new retail” was first coined by Jack Ma, founder and chairman of the Chinese e-commerce giant Alibaba, which has been moving into traditional bricks and mortar retailing.
Ma said he views the concept as “the integration of online, offline, logistics and data across a single value chain”.
“New retail can best be described as the convergence of online and offline retail to the point where they are so mixed with each other that they simply become integral parts of each other, and therefore retail becomes new,” said Matthew Crabbe, research director at Mintel, a London-based market research firm.
“What it means is that it includes all retail, whatever the channel of sale, be it online or offline.”
On July 25, US retailer Walmart and Chinese e-commerce site JD.com announced they will be “expanding their cooperation to further integrate their platforms, supply chains and customer resources in China”.
Coinciding with the launch of the first JD-Walmart 8.8 omni-channel shopping festival on Aug 8, the new initiative will give shoppers in China faster and more convenient access to high-quality products through multiple channels, JD.com told China Daily Asia Weekly.
The collaboration will boost the popularity of US-made products in China and allow consumers to directly buy goods from Walmart through the JD.com platform.
“Our ability to tap into JD.com’s advantages across logistics, big data, technology and customer service gives Walmart a huge advantage in reaching China’s rapidly expanding consumer class,” said Ben Hassing, senior vice-president of e-commerce and technology at Walmart China.
Carol Fung, president of JD Fast Moving Consumer Goods, said that as technology pushes the boundaries of what is possible, JD.com and Walmart will offer “complementary platforms and a commitment to customers that provides us with an enormous opportunity to define the future of retail in China”.
Over the last year or so, many of China’s top retailers — led by majors such as Alibaba and JD.com — have been looking for ways to improve the online and physical relationship of shopping.
“Alibaba has experimented with opening up physical stores and seems to be getting involved with the department store market in China,” said Oscar Orozco, senior forecasting analyst with US-based market research company eMarketer.
“For all intents and purposes, (what Alibaba is doing) is similar to what we would call omnichannel integration here in the US. Not a new term by any means, but it includes a well-balanced mix of in-store and online targeting of consumers,” he said.
Alibaba said a surge in mobile Internet usage and the growth of big data capabilities is driving “this new shopping experience as a way to better meet consumer demand”. The e-commerce group has 500 million monthly active mobile users. (Source: China Daily)