Bottom line: Alibaba’s plan to roll out 2,000 of its high-tech Hema grocery stores looks overly aggressive but typical for the company, and could prove costly if the concept fails to catch on.
Alibaba has big plans for Hema
E-commerce giant Alibaba(NYSE: BABA) is pretty much a carbon copy of its founder Jack Ma when it comes to standing still, in that the concept is completely foreign to both. I’ve been critical of the company in the past for getting into too many things too quickly without a coherent big-picture plan, and that’s what seems to be happening once more with Alibaba’s sudden obsession with finding a formula for the “new retail”.
Alibaba seems quite certain that retailing of the future will consist of some form of high-tech features, alongside traditional retailing concepts such as stores where actual products are sold and people can sit down for a fresh-cooked meal. Alibaba has been wheeling out a number of concepts on this new high-tech retail puzzle over the past year, but the latest plan is the first I’ve seen for an actual widespread roll-out of an actual chain. Read Full Post…
Bottom line: Alibaba’s new investment in grocery operator Sun Art looks like a shrewd move into an area where logical synergies between online and offline shopping can be achieved.
Alibaba buys into Sun Art
After a period of relative quiet, e-commerce giant Alibaba(NYSE: BABA) is splashing back into the major M&A headlines with its purchase of a major stake in grocery retailer Sun Art (HK: 6808) for HK$22.4 billion ($2.9 billion). This particular deal looks strikingly similar to an earlier tie-up between Alibaba’s archrival JD.com (Nasdaq: JD), which is joining online and offline grocery carts through its own older tie-up with Walmart (NYSE: WMT).
Each of these plays looks relatively savvy, acknowledging that off-line shopping will continue to play a major role in the retail experience for certain products. Alibaba has embraced this online-offline approach with a vengeance over the past year, snapping up a series of existing retail chains and also rolling out its own concept convenience store that is completely automated. Read Full Post…
Bottom line: Alibaba could buy the RT-Mart supermarket chain this year to boost its grocery business, while JD.com’s more online-focused effort and push into smaller cities looks like a better approach to the sector.
Alibaba grocer drives into Sun Art, JD goes to small cities
The online supermarket wars that began last year between e-commerce rivals Alibaba(NYSE: BABA) and JD.com (Nasdaq: JD) are heating up in the Year of the Rooster, though the pair seem to be taking slightly different tacks, at least based on the latest headlines. Leading those are reports that Alibaba is in talks for a tie-up of some sort with Sun Art (HKEx: 6808), operator of the popular RT-Mart supermarket chain. Meantime, JD is making its own headlines in the space, with an executive detailing the company’s plans to achieve 100 billion yuan ($14.5 billion) in sales from its operation this year. Read Full Post…
Bottom line: A blossoming price war between Alibaba and JD.com in the online grocery space could stretch out for the next year, costing each hundreds of millions of dollars on promotions as they battle for market share.
Alibaba to spend billions on Tmall Supermarket
Just days after e-commerce partners JD.com (Nasdaq: JD) and Walmart (NYSE: WMT) revealed a major promotion for their online grocery business, sector leader Alibaba (NYSE: BABA) is firing back that it will outspend its smaller rivals in the hotly contested space. This sudden price war in online groceries space looks remarkably similar to another battle that broke out nearly a year ago, when Alibaba launched another major promotion against online grocer Yihaodian, Walmart’s main China e-commerce site at the time. Walmart appeared to later concede defeat in that battle just two months ago when it sold Yihaodian in exchange for shares in JD.com, Alibaba’s chief rival. Read Full Post…
Bottom line: Reports of the insolvency of online grocer Yummy77 are probably correct, but the company could still engineer an emergency rescue that would see it emerge as a wholly owned subsidiary of a big backer like Amazon.
Yummy77 reportedly insolvent
Just a week after 2 major new fundings highlighted the big potential for online grocers, a new headline is shining a spotlight on the darker side of a market that has rapidly overheated as new companies rush to cash in on the trend. That headline has media reporting that 2-year-old online grocer Yummy77, which is backed by global e-commerce giant Amazon (Nasdaq: AMZN), has run out of cash and become insolvent, making it the first major casualty in the space.
Before we go any further, I should note that the news on Yummy77 is all coming from media reports that haven’t been confirmed by the company. But at least one of those reports comes from the highly reputable China Business Network (CBN), which cites a number of sources that seem to indicate the news is true. My own visit to Yummy77’s site, www.yummy77.com, showed no signs of anything unusual, and I was able to select items for sale and put them into my shopping cart as normal. Read Full Post…
Bottom line: Alibaba’s massive online grocery promotion looks aimed at countering potential new challenges from Walmart, as the US retailing giant overhauls its China e-commerce operations.
Alibaba launches major grocery promotion
Just days after Walmart (NYSE: WMT) made a major shift in its China e-commerce strategy, local market leader Alibaba (NYSE: BABA) is firing back with a massive 1 billion yuan ($160 million) promotion that looks squarely aimed at the US retailing giant. This particular promotion comes in the grocery space, which also happens to be a core strength of Yihaodian, the major plank in Walmart’s China e-commerce operation. Alibaba’s announcement also comes just days after Walmart announced it was buying out its partners in Yahaodian to take full control of the site and better integrate it with its existing China operations. Read Full Post…
