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Over the weekend, a new, unstaffed store opened up in Hangzhou. The Tao Café, created and run by Alibaba, is part of the e-commerce giant's efforts to break into the market of brick-and-mortar shops before and then watch as its competitors crumble.
But Alibaba was not the first to have this idea. It appears that, at least in this area, China's e-commerce leader has been struggling to keep up with its main global rival: Amazon. The American e-commerce company opened an unstaffed store in the US at the end of 2016, and Alibaba is just now getting around to opening their own.
At this point, unstaffed stores are even becoming a bit old school, considering the fact that a Swedish company just opened an automated, self-driving mobile store in Shanghai last month and that another app-controlled convenience store in Shanghai, BingoBox, has already been temporarily shut down for "technical maintenance."
Even so, according to ECNS, there was a long line of people waiting to enter Alibaba's new store on its opening day. Undoubtedly, they were attracted not only by the possibility of a futuristic shopping experience, but also by the fact that the products available were 20-30% cheaper than those at a typical convenience store.
Part of the appeal of this business model is that companies get to significantly cut back on the costs of maintaining a fully-staffed store. Currently, there are a few assistants at the Hangzhou location, there to make sure that customers understand the shopping process, but ideally, such help will be unnecessary once these stores become commonplace. Humans will no longer be needed.
In order to enter the store, customers must have Alibaba's Taobao app downloaded on their phone. Each door has a gate, which resembles those found on subways, where shoppers scan their personal QR code upon entry.
Up to 50 customers at a time can peruse the 200-square-meter space, and may purchase a variety of fast food beverages and snacks. After selecting their desired products, shoppers simply exit the store via passages equipped with facial recognition scanners. Once their faces are confirmed each patron is then charged automatically for their purchases via their phone's Alipay app.
The system developer of the technology used in the store is Ant Finance, a tech company owned by Alibaba. And it seems that they have done a pretty good job.
The rapid advancement of these automated shops heralds dark times ahead for traditional retailers. Alibaba is just one part of the technological revolution occurring in China, in which businesses either evolve or fall into obscurity. So, if you can't make the day-trip to Hangzhou to visit the Tao Café, do not fear; this store will certainly not be the last of its kind.(news from the shanghai daily)