Chinese ecommerce giant Alibaba has embarked on a new phase of its Australian expansion, selling technology solutions to Australian retailers.
Alibaba’s strategy in Australia is a B2B one which has largely been focused on getting Australian brands to sell into China using its ecommerce marketplace and signing up 8,000 Australian retailers to accept Alipay as a payment method from Chinese visitors.
Since launching its cloud computing operations in Australia in November 2016, Alibaba is increasingly looking to provide retailers technology services for their online and physical stores.
Its first local customer in The Iconic, which is using a image search tool built by Alibaba, which allows shoppers to take a picture of an item of clothing they like and then displays similar products. For example, the computer recognises an image of checked shirt and will show similar products available for sale on The Iconic.
The technology comes from Alibaba’s Cloud division, which originally launched in Australia offering computing services, but has since expanded its offerings to include security, big data and AI services.
“The next step is we are trying to build up a series of the New Retail solutions to serve local merchants to help with with their digital transformation,” Raymond Ma, head of ASEAN and ANZ for Alibaba Cloud told Which-50.
Over the last fortnight Alibaba has been showcasing its store-based technology solutions to Australian retailers in a pop-up store in Sydney’s Chatswood.
The technology solutions on show included QR codes on products, digital screens which offer product information and inventory which is available online. On the more gimmicky side was a camera which recognised your facial expression and recommended products based on how your were feeling. Pulling a sad face? How about you buy some chocolate.
A large TV screen, pictured above, featured a Pac-Man style game that users control from their mobile phones to entice customers into the store.
The products all fall under what Alibaba refers to as ‘New Retail’ which was developed to help modernise China’s retail stores by providing them with technology to bring them into the digital age.
So why should an Australian retailer look to Alibaba for tech?
“We have the retail gene,” Ma said.
Alibaba’s cloud is the infrastructure that supports its Tmall and Taobao online stores in China. In more recent years, the company has been working with physical retailers in China, for example it incubated the Hema supermarket concept which is operated by Alibaba or licensed to supermarket franchisees.
During a 2017 earnings call, Alibaba CEO Daniel Zhang said the company plans to open more Hema stores in key cities around China via franchise agreements.
“We don’t want to open all the stores by ourselves. Instead, we work with our retail partners in different cities and we help them to copy the Hema model into the local cities to franchise the business,” Zhang said.