Prime Day? Alibaba prepares for something bigger
For anyone who thought Amazon’s July “Prime Day” event was the biggest shopping day of the year, check out Alibaba’s upcoming “Global Shopping Festival” promotion.
Global Shopping Festival grew out of Singles Day, an informal celebration of the Chinese singles dating scene which Alibaba formally turned into a shopping holiday in 2009. Falling on Nov. 11, what is now known as
Global Shopping Festival generated gross merchandise volume of more than $9.3 billion on the Alibaba Alipay mobile and digital payment platform in 2014.
This year, more than 1,000 retail brands, with 180,000 stores in 330 cities across China, will participate. Consumers will be able to receive discounts in-store as well as online, including in retailers’ Alibaba online storefronts. Products in 10 major categories will be featured: automobiles, home furnishing and décor, household items, consumer electronics, beauty and health, food, apparel, body care, baby care, and travel and hotel accommodation.
The promotion will feature six million products from more than 40,000 merchants and 30,000 brands, including 5,000 overseas brands from 25 countries and regions such as the U.S, Europe, Japan and South Korea
“Omnichannel retailing is one of the key initiatives for this year’s 11.11 Global Shopping Festival,” said Jeff Zhang, president of China Retail Marketplaces at Alibaba Group. “It marks the first step in achieving the full integration of digital and physical commerce. Alibaba Group is dedicated to working with brands and retailers to facilitate their transition from traditional to omnichannel retailing.”
Specific omnichannel features Alibaba will offer for Global Shopping Festival include location-based in-store coupons delivered through Alibaba’s Taobao mobile app, advance reserve purchases of discounted items in select stores, and optimized pickup and delivery of online purchases using Alibaba ERP-POS Link.
Alibaba has a significant advantage in its promotion compared to Prime Day, in that there is also a strong in-store component. Of course, although both promotions are global, Alibaba’s home market of more than 1 billion Chinese consumers is also a benefit.
It is also worth noting that Alibaba appears to be focusing on providing items consumers truly want, while many Prime Day deals were obvious efforts to clear slow-selling overstock and leftover merchandise. Given Amazon’s global reach and potential for omnichannel collaborations with brick-and-mortar retail partners, with some fine-tuning next year’s Prime Day may come closer to Global Shopping Festival volume.
Target increases food focus with eye toward future
Target Corp. has made grocery and perishable products a big part of its turnaround strategy, and is committing to do so for the forseeable future.
Target is partnering with the MIT Media Lab and global design firm Ideo on a multi-year collaboration, known as the Food + Future coLAB, to explore the future of food. The work will focus on areas such as urban farming, food transparency and authenticity, supply chain and health.
The partnership will kick off this month with intensive data analysis. Working with MIT Media Lab’s Laboratory for Social Machines, Target will collect and analyze billions of public data points. These will include brand communications, traditional and social media messages and supply chain information, in an effort to map the global conversations related to food.
Later this year, Target will launch a website with Ideo to identify trends and ultimately explore how food will be grown, sold and consumed in the next 15 years.
In January, Target and Ideo will officially launch the Food + Future coLAB in Cambridge, Massachusetts. The coLAB, which will draw on iresearch being conducted at the MIT Media Lab, will house multidisciplinary teams from these three organizations, as well as others,
Target and MIT’s Open Agriculture initiative will also begin a multi-year collaboration to explore city farming across multiple scales of an open platform
“By combining the boundless curiosity and discovery of MIT’s Media Lab and IDEO’s human-centered approach to design with Target’s knowledge of retail, we can reimagine the future of food,” said Greg Shewmaker, one of Target’s Entrepreneurs-in-Residence, who is leading the Food + Future coLAB. “We know more about what’s in our smartphones than we do in the last meal we ate. And that’s something we want to change. This collaboration will help to unlock more options and create more transparency not just for Target’s guests, but consumers everywhere.”
Target is looking for an accelerator
Start-ups looking to revolutionize retail have a significant new opportunity for support.
Target Corp. is officially kicking off the application process for a new retail accelerator it is launching in 2016 in partnership with Boulder, Colorado-based start-up accelerator Techstars. Target and Techstars will accept applications for the accelerator, which will be based in Target’s headquarters city of Minneapolis, through March 2016. Selections are expected to be complete by April or May, with the accelerator lasting from June to September.
Target has signed a three-year agreement with Techstars which will include three rounds of start-up development and funding. In an interview with Chain Store Age, Target spokesperson Jenna Reck said the program sprung from efforts initiated by Target chief strategy and innovation office Casey Carl.
“We’ve had a dedicated innovation team for a couple of years,” said Reck. “Last year, Carl accelerated the work of the team and this spring hired three entrepreneurs-in-residence (EIR) who are experts in areas such as digital and brand-building. They were charged to create business and drive new growth for Target.”
West Stringfellow, digital EIR for Target, recommended that Target launch an accelerator program and partner with TechStars based on its 90% success rate. Goals of the program include creating a new community of innovators in Target’s backyard.
“We want to help build a start-up and tech community in the Twin Cities,” said Reck. “After participating in an accelerator, at least half of start-ups usually plant some type of permanent roots in the city where the program took place.”
In addition, Reck said the accelerator project fits into Target’s larger turnaround initiative.
“We’re on a path to transformation,” she said. “By brining start-ups into our headquarters we can learn from them and see how they work. Start-ups are quick, scrappy and resourceful.”
The accelerator will initially select 10 startups, as well as a team from Target. Selected startups will receive financing, mentoring and business development tools.
Specifically, this will include an offer of $20,000 from Techstars for 6% equity in the company, with the option to take up to another $100,000. Target may also offer to invest in or purchase start-ups, but that is not guaranteed. At the end of the program, media and investors will be able to see public demos of the start-ups.
“We don’t know what we don’t know,” said Reck. “We want to leave things open-ended.”
Target says it will consider all types of startups, including those that provide behind-the-scenes software as well as customer-facing systems or products. Start-ups will be allowed to work with other retailers besides Target.
Mentors will include Carl and Stringfellow, as well as Target executives Jamil Ghani, VP of enterprise strategy, and Jason Goldberger, president of Target.com and mobile.
Stringfellow previously served as chief product officer of Bigcommerce, and has also held several senior director- and director-level positions for PayPal and several product manager roles at Amazon.com. In a Target blog posting, Stringfellow said the most important start-up aspect Target and Techstars will look for is team. Other factors for consideration include the market being targeted, progress that has been made, and strength of idea.
“A great team can change an idea and still succeed, but a mediocre team will struggle to execute on even a great idea,” said Stringfellow. “We look for people who can execute quickly, are coachable and listen well, are thoughtful but make fast decisions, are intellectually honest, are persistent, follow through and are insanely passionate about what they do. We’re looking for rock stars.”
Target has operated its own innovation center in San Francisco since 2013, and many other large retailers also have their own dedicated internal innovation programs. Reck said Target has about 50 total members of its innovation team, based both in San Francisco and Minneapolis.
“The accelerator will be complementary to the innovation team,” said Reck.
When asked if Target’s inclusion of an in-house team is a sign the retailer might be considering launching its own technology companies or products, Reck said there are currently no plans to do so. However, she clarified that at this stage, Target primarily seeks to discover more about how start-ups create and drive innovation.
“The goal is to have the in-house team work hand-in-hand with the start-ups and learn from them,” said Reck.
Target is upping the innovation ante by looking outside the company to help develop start-ups it will not directly control. By focusing on the best ideas it can find anywhere, rather than on the best ideas it can internally generate, Target is poised to help advance retail innovation both inside and outside the company.
Apply to the Target-Techstars retail acceleratorhere.