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This in-depth guide to China explores the key trends in grocery retail and the growth strategies of the leading retailers in the country.

We review Alibaba's current performance, its growth forecasts for the next five years, plus progress against key strategic objectives.

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Alibaba continues to expand its presence in bricks and mortar in China, with plans to reach at least 2,000 stores across the market by 2022. 

Accelerating expansion and coverage

Alibaba currently operates 160 Freshippo stores in 21 cities. It hopes to cover 200 cities by 2030, targeting cities with populations in excess of one million. The first store opened in Shanghai back in Janaury 2016.

Freshippo key highlights

  • Blending retail and foodservice: quality seafood in live water tanks that you can pick and have cooked to dine in-store or to go

  • Fulfilling delivery needs: 30 minutes within a 3km radius of each store

  • Technology-driven store: obtain product information by scanning QR codes with a smartphone, automated check-out enabled by RFID tags and cashless payment through Alipay (stores now accept other payment platforms and cash)

Subscribers can view our store visit report on Alibaba’s Freshippo (Hema Fresh) here.

Smaller formats can help boost network

It is unclear whether Alibaba’s smaller (and latest) formats fall under its latest plans for expansion.

The retailer also operates Ego and Hema fast&freshade (also known as Hema f2) convenience banners. Both formats display Alibaba’s ecommerce technology and expertise in a smaller space.

Hema f2, for example, allows shoppers to place orders via the Hema app, and features lockers outside the store to offer customers a flexible option to collect their food. All checkouts are unstaffed, payment options include facial recognition.

Strategic outlook for Alibaba

Subscribers can read more about Alibaba's current performance, its growth forecasts for the next five years, plus progress against key strategic objectives here.

Alibaba has announced that James Dong will take over from Max Zhang to be the new CEO of Lazada Vietnam.

Enabling greater cross-country collaborations.

Dong will retain the position of CEO of Lazada Thailand, allowowing him to enable greater cross-country developments. Dong adds, “Vietnam continues to present a huge opportunity for Lazada. I am confident that we will win in the market by engaging a young population, leveraging the quick pace of trends and through continuous application of our strong technology and logistics foundation.”

Alibaba is launching next generation flagship stores on Tmall.

Flagship Store 2.0

The new format on Tmall will be called Flagship Store 2.0. It will allow brands to provide more personalised experiences for shoppers. Flagship Store 2.0 will place likely purchases on a store’s first page rather than make shoppers search for the things they want.

They will also personalise content and offers to individual preferences. Users that tend to watch videos, for example, will see more short-form video content compared to those who enjoy shopping via livestream. Brands will be able to feature content powered by augmented reality on their homepages, e.g. magic mirrors to virtually try on make-up.

Greater online and offline integration

The new flagship stores will also feature a new tab that shows users the closest bricks and mortar location, which items are sold in those stores, as well as offline offers and services. This provides physical stores an online presence, helping brands better connect online and offline operations.

Alibaba rolling out technological innovations

The flagship store is part of a wider roll out of innovations this year, including search and recommendation, marketing and brand operations. The online giant has not provided details on when the new format will go live, but it is expected to launch ahead of this year’s 11.11 Global Shopping Festival.

Alibaba has launched an English-language portal for its Tmall Global marketplace.

Recruiting new merchants

The new portal looks to recruit new merchants. Alibaba aims to double the number of international brands on the platform to 40,000 in the next three years. Tmall Global currently covers brands from 77 countries and regions. Alibaba hopes the new website will make the B2C marketplace even more accessible to merchants.

How it works

The new English-language portal assists merchants with tasks such as opening shops on Tmall Global. The retailer says it plans to launch other versions in addition to English, such as Spanish, Japanese and Korean, in the future.

In the past, Tmall Global’s business-development teams would typically identify brands that they think will be successful on the platform and work to launch their flagship stores. The new portal will allow merchants to pitch directly to Tmall Global by simply filling out a questionnaire and describing their business. Tmall Global will then contact successful applicants within 72 hours to discuss the onboarding process.

Helping brands introduce their products

Yi Qian, deputy general Tmall Global’s Deputy Manager, said, “We believe the launch of this English-language website will expedite the process for brands and merchants to introduce their products to Chinese consumer.”

We've developed a single, universal methodology for calculating food and consumer goods retail data, supported by our programme of primary and secondary research. This makes Datacentre the most reliable and robust source available for data of this type. 

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