Alibaba has signed a strategic partnership with Beijing to turn the capital into a “city of new retail,” according to KrASIA. Alibaba will apply technologies including big data, cloud computing, artificial intelligence (AI) and online mapping across the municipality.
Beijing will serve as a test bed for several of Alibaba’s brands, including the Tmall e-Commerce supermarket offering one-hour delivery for neighboring communities, and Hema Xiansheng, a new convenience store concept with plans to open 30 locations in the city.
Additionally, Alibaba will invest in a new 1,300-square-meter store created in partnership with Intersport, a sporting goods retailer, according to Footwear News. The store, powered by Tmall Fashion, features technology such as a display that can identify the gender and approximate age of passersby and recommend appropriate products, and a smart mirror that detects the shoes a customer is trying on and offers additional information about them.
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Approximately 82% of China’s retail sales are still offline, and Alibaba wants to boost its omnichannel offerings through its “new retail” initiative. Alibaba’s mobile app currently has 552 million annual active users across China, up from 454 million users as of March 31, 2017.
Other retailers are using public-private partnerships to fuel innovation. Supermarket giant Ahold Delhaize has become the first partner to work with the University of Amsterdam’s Innovation Center for Artificial Intelligence. The public university’s AI For Retail Lab (AIRLab) will conduct research into algorithms that can be used to make consumer recommendations and more efficiently manage the flow of goods.
In the U.S., the largest public-private partnership remains Amazon’s delivery deal with the United States Postal Service (USPS). The relationship has proven mutually beneficial: Amazon’s contract has helped stem losses at the USPS by taking advantage of its underused capacity, according to The Inquirer. In return, Amazon has its packages delivered at rates below what UPS and FedEx charge.
