The American coffee company, Starbucks Corporation is partnering with Alibaba Group as it is looking forward to boost their business growth in China.
The global beverage giant has found it difficult to maintain their business growth across China for quite a long time now. Initially, the company managed to capture the crowd attention but once its new ambitious local rivals; Luckin Coffee was launched, their business started to slow down.
To cope with the challenge, Starbucks will roll out new retailing strategies in China. And Alibaba Group will help them to build up the strategy. The $9.5B food delivery platform called Ele.me (Owned by Alibaba) will help Starbucks in delivering the orders to different customers. With that, people will not have to visit the store anymore. Initially, the service will be launched in Shanghai and Beijing, this September. By December, the services will be extended to more than 30 cities and over 2000 stores across the country.
The beverage giant is also developing an application, to launch in Alibaba’s website which also includes its Tmall brand e-mall and Taobao marketplace. According to a source, the move will help Starbucks to operate “similar to the mobile app embedded right into that experience” and introduce Starbucks to around 500 million Alibaba users.
This deal is a major coup for Alibaba in battling JD.com on the new retail front.