Alibaba Open Smart Store in Shanghai

One more fashion concept store opened its door in Shanghai recently, called Kerr&Kroes. The key high techy elements inside are:

-Virtual fitting:

The technology offers personalized apparel recommendation based on each individual’s face, body shape or selected preference. In addition, the screen also allows other functions like social sharing, online search etc.

-Facial recognition for payment and rewarding gift

-AR gaming effects

-Interact digital signage display

We know these techy features are already becoming déjà vu in China. We have no reason to feel excited. More and more retailers are shutting down regular brick&mortar in China, but jumping on the bandwagon of a fancy smart store. In fact, Alibaba has been bolstering such trend, as part of its aggressive “New Retail” plan.

Kerr&Kroes is just one example here powered by Alibaba. Their partnership started in September last year and their very first smart store experimented in a 3rd tier city in Shandong province back then. Now Kerr&Kroes expands to 1st tier city, hoping to roll out 6 more by the end of 2018 and hit the goal of 20 stores in 2019.

If you are a retailer who would like to push the action button of a smart store or pop store, Alibaba wants you to look no further. It now provides you an end to end solution. By checking Alibaba’s smart store offer below, it includes services like:

  • omni-channel CRM marketing tool
  • Offline traffic counting and analysis
  • Interactive digital signage
  • RFID
  • Virtual fitting
  • AR/VR
  • Smart payment
  • Smart Vending machine
  • Brand data bank: mostly about big data analysis, business intelligence, customer profiling etc

But if you think Alibaba do it all in-house, you are wrong here. Alibaba outsources “official vendor” for you. For instance, under “Virtual Fitting” category, Alibaba recommends two startups as service providers.

For example, Cloudream is a company founded in 2014, still in the Pre-A stage funding, with a team size of 100 based in Shenzhen. It is also the virtual fitting mirror provider behind Kerr&Kroes. 

The intention of Alibaba could not be more crystal clear. Since it already wielded its indisputable influence upon e-commerce, any future offline innovation also should pass through its control. It is said Tencent&JD has been implementing very similar end to end solution for smart retail as well, cultivating its own startup vendors and quickly building an incredible ecosystem in order to compete with Alibaba. Ironically, many brands and retailers might be easily caught in the middle during such tug of war for “New Retail”.  The words already surfaced that if a company refuses to sign an exclusive deal with Alibaba, and tries to have a foot in both camps, you would be very likely punished by disqualifying for special promotions or disappearing in top search results on Tmall, thus losing substantial sales.

Though Alibaba has opened sesame for the smart store, brands and retailers might trade independence for treasure. Or perhaps has independence become too flimsy to maintain these days, considering Alibaba’s utter dominance on your online distribution channel and massive proprietary data it has over your brand and your customers (by claiming them “brand data bank”)?

Author: Cecilia Wu