China has at least a total of 24,000 convenience stores nationwide, with an estimated annual sales value around RMB 48 billion (USD 7.2 billion). Aside from convenience stores, about 7 million of old-school mom-pop stores are still scattering around the country.
The competitive landscape of the convenience store mainly consists of three major types of players:
- Foreign background
- Local homegrown
- Innovative breed usually launched by e-commerce giants Alibaba, JD.com or new startups
Today one key technology in China in order to digitally transform the old legacy infrastructure of the traditional convenience store is through facial recognition.
Just by installing one screen embedded with a camera on top of your check-out counter, then conveniently integrating with your existing POS machine, the magic of facial recognition comes to play:
- membership identification
- AR interaction
- personalized coupon promotion
- facial recognition payment via Wechat
On top of that, the facial recognition check-out step helps brands and merchants to collect a substantial amount of your end customers’ data and generate useful insights.
JD.com is already partnering with this startup to push such a solution not only to its own convenience stores but also to other traditional players or even mom-pop stores.
It is said that last year when JD.com was taking Coca-Cola’s CEO James Quincey for a tour of its convenience store, he was quite impressed with the facial recognition gambit.
In fact, quite a few such startups in China have sprung up, aiming to sell the technology and data analysis to convenience stores, chain stores, FMCG brands. All claim they can reduce the hardware costs at a lower level.
By: Cecilia Wu