Amazing China

car-sharing economy in China.

QR codes, big data, facial recognition, data sharing, user predictive behavior assessment to fuel the young car-sharing economy in China.
QR codes, big data, facial recognition, data sharing, user predictive behavior assessment to fuel the young car-sharing economy in China. 1678 1119 Altavia

Like anything else in China, local companies are not afraid of getting into a massive fight with the same idea in order to get market share; not afraid at all to share the cake. As a result, exactly the same way we saw dozens of bike-sharing companies budding for the last year, more than 30 car sharing companies have rolled out a total of 4,158 cars on Guangzhou’s roads as of the end of July.

The number of shared cars is still rising in and it is projected to reach 20,000 by the end of 2018.

 

Earlier in August, the Ministry of Transport and Ministry of Housing and Urban-Rural Development issued a policy promoting the development of the car sharing industry.

The policy requires car-sharing companies to check the ID and driving license of car renters and record the information in the car-rental contract.

 

Go fun, one of the car-sharing companies, headquartered in Beijing, said that it has begun to apply facial recognition technology to check whether renters’ faces match the photos in their IDs and driving licenses.

 

The company also claimed that technologies including which detect driver fatigue, and driver evaluation will be applied in the future.

Although the number of shared cars keeps rising, it is still difficult to find a shared car on the road. According to Gofun, their cars are mostly distributed in Tianhe district, Haizhu district, Baiyun district and the train station.

 

Similar to bike-sharing, the car-sharing industry also requires a deposit and renters need to take good care of the cars. In this aspect, car sharing companies in Guangzhou are striving to set up a credit system.

car rent china

A car renter uses her mobile phone to scan a QR code to open the door of a shared car. [Photo/xkb.com.cn]

To be noted that this credit system issue has been smartly addressed by Alipay / Ofo. If your “Zhima credit” instant rating on your Alipay app is high enough, you will not be required to make the 299 Rmb deposit.

Go fun is trying to use a credit system to replace the guarantee deposit which uses a recording device in the car to track drivers’ actions and uploads dangerous driving behavior to the credit system.

According to the Guangzhou Car Sharing Special Committee, a bad credit database has been founded to sort out the bad credit data from car sharing companies and promote data sharing for the whole industry.

 

As usual, pragmatism will prevail and honestly, let’s hope that, the same way bike-sharing is helping to reduce our carbon footprint, car-sharing will also have a positive environmental impact for the benefit of the greatest number.

 

Who would have fought, a little more than one year ago that #Mobike and #Ofo would have put Chinese people back on bicycle while car have been among the most desire thing to possess for most of Chinese?

Will Chinese people be ready to share a car? Abandon for an instant the social status car is bringing them?

In many cities it would make sense since the average number of passengers in a single car is clearly below 2 people…

 

By Stéphane Joly, Executive Vice-president, Altavia Asia

 

Offline stores in China are all but not dead…
Offline stores in China are all but not dead… 1678 1119 Altavia

As rightly written in China daily recently, not only Alibaba but also its main competitor, JD.com are going full steam in opening physical stores in China. Both of them do not just open stores like classic / old fashion offline retailers… they leverage on the online data they have accumulated and turn their physical stores into retail labs. Not only they want the shopping experience between off and online to be seamless, they want it to be of the same fabric…

 

JD goes for:”retail experience shops” while Alibaba develops its vision of “new retail”. To expand faster in the physical world, JD is pushing the franchise model… Pragmatism is key for this new future.

 

Extract from FAN FEIFEI (China Daily), Updated:August 2017 :

 

JD“JD.com Inc, China’s second-biggest e-commerce player, plans to open 200 more bricks-and-mortar stores－mainly offering consumer electronics products－by the end of this year. In doing so, it will be in direct competition with Suning Commerce Group and Gome Electrical Appliances Holding Ltd, two of the biggest electronic offline retailers in China.

 

Using a franchise model, the shops will be powered by the company’s cutting-edge technology. Upon entering a JD store, a camera recognizes customer faces and tracks the duration of their stay and where they spend the most time.

 

JD will make use of big data analytics technology to keep offline stores stocked with recommended categories and suggested amounts of products, while localizing the selection depending on consumer-buying preferences in each location.

 

“By expanding our offline business, we believe we can make shopping both online and offline better for service partners and consumers,” said Hu Shengli, president of JD Electronics.

 

So far, there are 92 JD retail experience shops, and the number will increase to 300 by the end of this year, according to JD. The stores are mainly located in key business districts, shopping malls and supermarkets, such as Walmart and Wanda Plaza.

 

“At present, offline sales still make up … 70 percent of the total sales. JD has an upper hand in supply chain management, from procurement, transportation to quality control, and hopes to expand its offline reach across the nation, depending on its current advantages,” said Lu Zhenwang, CEO of Shanghai-based Wanqing Consultancy.

 

However, JD doesn’t pose a threat to Suning and Gome as the number of its offline retail shops is limited, Lu said. “The company will face some difficulties to open stores in fourth-and fifth-tier cities.”

 

China’s online shopping is seeing robust growth, with total online retail sales hitting 2.47 trillion yuan ($370 billion) in the first five months this year, up 32.5 percent year-on-year.

 

However, physical goods sold online accounted for only 13.2 percent of total retail sales in the same period, according to the National Bureau of Statistics.

 

Back to square 1: Offline is far from dead but need to be enriched by the data collected and analyzed from Online transactions to better serve customers.”

 

By Stéphane Joly, Executive Vice President, Altavia Asia

Alibaba wants to change the way we shop for fresh food off and online
Alibaba wants to change the way we shop for fresh food off and online 2048 1536 Altavia

Here comes Hema Market (盒马集市)

Despite its US $ 150 Million investment Alibaba has been quite low-key running the Hema Markets chain… Hema Market (盒马集市) is a rather premium, fresh offline chain here in Shanghai that refuses to label itself as a “supermarket” but rather as an “e-commerce experience store”. Hema Market is like an expanded version of C!ty’super (premium supermarkets). Its main focus is fresh food and dry grocery.

Hema (“盒马”) is a homophone and wordplay of hippo (河马), replacing “river” with “box” –a name associated with other members of the “Alibaba Zoo” (previously they’ve rolled out Tmall — cat, Alitrip — pig, Antgroup — ant, etc).

 

 

In early 2016, Hema made the transition from fresh food e-commerce and food delivery to offline markets. They opened their stores in places that are a bit further away from downtown Shanghai. This latest store opened a couple of months ago, located in the busy part of Pudong, underneath the shopping complex Shanghai Bay.

 

 

But what makes the Hema Market so particular ? 

  • They are Cashless…(cash looks like a dying king), Alipay being the only payment method allowed.
  • The stores are used for both pick-up and online delivery within the same day only and as fast as within 1 hour.
  • Shopping online with Hema requires the application to be installed on your smartphone.
  • Digital price tags are installed in store for an efficient pricing.

 

 

The Hema Market could be divided roughly in two parts: First, a regular supermarket providing dry food (imports and local), pre-packed fruits and pre-packed veggies, dairy, beverages… and, secondly, a third party food and beverage consignment like many food courts that we can find in China.

 

Hema employees can be seen taking and processing orders from online shoppers. They’re selecting items, packaging them, and sending them off to the delivery department using conveyor belts.

 

 

 

It is interesting to see Alibaba keeping investing on the offline retail, trying new way to #makeretailgreatagain.

Some of my colleagues, here in Shanghai, who tried Hema delivery,  were all satisfied with the prices, efficiency of delivery and quality of the goods they ordered, which for fresh goods is a deal breaker.

 

Nice place to visit for a retail geek, nice place to have some decent food for lunch, and nice place to see an efficient way of picking in store for online deliveries!

 

 By Stéphane Joly

 

 

 

Le succès fulgurant du paiement mobile

[CHINA] The dazzling success of mobile payment
[CHINA] The dazzling success of mobile payment 1570 961 Altavia

 

In China, technological advances in mobile payment have developed hugely in only five years. Electronic wallets are quick, secure and free to use, and today 450 million people in China are taking advantage. Wallets are an excellent way for brands and labels to find out everything (or nearly everything!) about their clients’ habits and preferences.

 

Often, it’s the first thing we do when we wake up. We reach for our smartphones, check our messages, tap in a few notes, see what has been happening on our social media feeds. Then we slide our precious companion into our pockets, only to take it out again two minutes later. Mobiles have become essential items from which we can’t be separated. “In China, some people have understood this and seen huge potential in mobile internet’s first tentative steps,” says Stéphane Joly, Executive Vice President of Altavia Asia, “Major groups like Tencent have focused their technological efforts on mobile use, which has exploded in the past few years.” The Chinese now scan QR codes to access apps or sites and to pay for products and services. It’s all done using a mobile phone.

 

The electronic wallet’s success

 

Whether they use WeChat Pay (Tencent) or Alipay (Alibaba), more and more Chinese people are taking out their smartphones at the tills. More than 450 million in fact! “It has quickly become a habit, although five years ago it didn’t even exist,” adds Stéphane Joly, “I no longer carry cash, just like 45% of electronic wallet users. When I go to a restaurant, I pay with my phone. It’s the same for taxis, the supermarket and a coffee at the café on the corner. Everyone has QR code readers!”

 

In China, mobile payment transactions today represent 5.5 trillion dollars. That’s 50 times the size of the American market (10 times more for a comparable population size).

 

Mobile payment is totally secure, free, efficient and leads to significant time savings for users (scanning and paying only takes a few seconds). And there’s the freedom you gain by not having to deal with cash.

 

Always a step ahead 

 

Behind the phenomenal success of WeChat, launched in 2011, is Chinese new technology group Tencent. The group is almost unknown in Europe, although they have been experiencing rapid growth over the last few years. Tencent has risen to become one of the 10 highest-listed companies in the world, with 300 billion market capitalisation (in first place is Apple, with 800 billion dollars).

 

Originally a simple messaging system, WeChat has today become an app which lets you do almost anything; Chinese users spend 30% of their online time on it. However, in 2013 two messengers were being widely used: QQ, with 820 million users, and the young WeChat, which only had 200 million users at that time. Four years later, QQ has not developed and is about to disappear, whereas WeChat, which has integrated mobile payment into its functions, has grown its user base to five times its 2013 size. Messengers without mobile payment have no future in China, and Tencent has quickly become aware of the fact.

 

And the adventure is far from over. When it comes to electronic wallets, “the Chinese are always thinking about how they can help users become more at ease and confident,” says Stéphane Joly, “Alibaba subsidiary Ant Financial has just acquired the American start-up EyeVerify and its iris recognition technology for mobile apps. Fingerprint secure transactions will soon be replaced by a system which they say is impregnable.” Indeed, China is always one step ahead!

 

Dominating the world of transactions

 

Focusing technological efforts on the mobile sector, and, in particular, phone payment, is in fact a highly strategic choice. According to Stéphane Joly: “We know that the crux of customer insight is understanding client transactions, so enabling the electronic wallet to succeed is more than relevant. The Chinese have invested everything in QR code technology, which involves scanning codes with a phone, with a view to dominating these notorious transactions.” Considerable amounts of data are collected and brands know everything about their clients’ behaviour and habits: perfect for launching a carefully targeted ad campaign with results of which you can be sure.

 

 

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