By Robyn Mak
HONG KONG (Reuters Breakingviews) - Jack Ma is about to show off his new toys. China’s “Singles’ Day”, on Nov. 11, kicks off nearly a month of discounts and promotions. The extravaganza means lots of free PR and huge transaction volumes for Alibaba, his $480 billion behemoth. For investors, the stunts will also illustrate how supermarkets, augmented reality and mobile payments fit in Ma’s “new retail” strategy.
Singles’ Day has quickly outgrown its U.S. equivalents, Black Friday and Cyber Monday. This year more than 140,000 brands on Alibaba’s sites will offer online shoppers discounts on everything from Prada bags to Mexican avocados. Analysts reckon transactions will surpass the staggering $18 billion Alibaba handled last year – although different pricing and return policies this year mean the numbers will not be directly comparable to last year’s, and in any case they say little about the group’s financial performance.
There will be gimmicks aplenty, too. Last year, a Pokemon-style AR game let smartphone users catch virtual cats in stores to win coupons. Alibaba also live-streamed a fashion show, with real-time ordering of clothes worn on the catwalk.
This year, Ma is keen to showcase his marriage of online and offline commerce. So nearly a million physical retailers and convenience stores will participate in promotions and use Alibaba’s cloud computing, payments, and delivery services. For example, store owners can borrow from his financial technology group, Ant Financial, while shoppers can “smile to pay” with an Ant app or try on clothes on an AR-powered mirror.
With Alibaba shares more than doubling this year, investors seem to have bought into the company’s move away from its “asset-light” origins to target a larger slice of China’s overall retail market. Still, a little proof of concept is always helpful.
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