In China, retail and payment methods evolved hand in hand over the last decade to create what is possibly the most innovative retail environment in the world. E-commerce took off explosively with the increasing ubiquity of cashless payments. China is in fact leapfrogging an underdeveloped brick and mortar retail set-up and the lack of a network of credit cards and EFTPOS terminals common in the West.
But as new retail is evolving, it is getting clear that it is not so much about online shopping versus brick and mortar. Most of all, Chinese consumers want to shop on their own terms: the surge of partnerships of digital operators with brick-and-mortar retailers show a growing appetite for seamless omnichannel shopping. Convenience is king and consumers expect to connect with merchants when and how they want to. Brands that can blend online and online into holistic, rewarding experiences in China will prevail.
Alibaba's New Retail concept ties into this trend and is a game-changer across retail experiences in China. It augments physical stores through novel online e-commerce technology. For example, Alibaba’s Hema supermarkets offer shopping via smartphones from home or in store. Each store serves as its own warehouse and logistics center that collects, fulfills and delivers orders. Stores that are equipped with “virtual shelves,” where customers can select products that aren’t in store to be delivered to their home. Alibaba’s automobile vending machines let customers browse models in their app, choose one to test drive, pick it up from an unmanned vending machine and drive it for up to three days.
Some of our recent projects helping clients understand China's retail environment include the following :
New Look : China Insight conducted a workshop for New Look’s customer insight team in which it presented an analysis of the retail environment in China. Upcoming retail trends, competitor environment, and winning promotional concepts were covered.
Market Entry Research for UK Retail Brand : China Insight was approached by branding consultancy Circus to provide market and consumer intelligence for a UK retail brand preparing to enter the China market, spanning cosmetics, personal care products, fashion and gifting.The remit included an analysis of market barriers, market entry strategy analysis of eight major competitors, analysis of positioning and communication of same competitor brands and consumer trends relevant to the beauty and lifestyle categories.Given a tight project timeline, we delivered a 10 day turn around based on desktop-research of English and Chinese sources, store visits and in-depth interviews in China with industry experts and with opinion leaders such as bloggers.