Alibaba unveils a mobile app that enables physical stores to market to shoppers

May 13, 2015 02:46 PM

Bricks-and-mortar stores in China could be forgiven for looking at Alibaba Group Holdings Ltd., China’s dominant e-commerce company, as a threat. But Alibaba has recently introduced a mobile app that can help stores market to shoppers—if the stores accept Alipay.

Chinese consumers have begun using the Miao Street app in Hangzhou, where Alibaba is based.

In the Chinese language, “miao” describes the voice of a cat, which is the mascot of Alibaba Group.   

“Miao Street make shopping easier because shopping mall operators and stores could provide location-based services to consumers. Even before consumers go shopping, the app could tell them about parking availability in the mall. Miao Street could navigate the shopper to an empty parking space,” says Guo Dalu, general manager of Alibaba’s city life business unit.      

When consumers arrive at the mall, the app also can display coupons from stores and direct them to a store or such features as ATMs, restrooms or escalators.           

AutoNavi, an online map company that Alibaba acquired in 2014, provides the indoor location data and navigation technology to Miao Street. AutoNavi, an online mapping and navigation service provider in China, claims more than 200 million users. Miao Street also works with Alibaba’s payment system, Alipay, so that consumers can pay via the app without carrying credit cards or cash.

Guo says Alibaba offers the app for free to physical stores. The only requirement is that the stores accept Alipay. 

The app also offers social media features that enable a consumer to follow a store in order to receive coupons or other promotions. If a store has installed beacons, which are transmitters that communicate with smartphones, the app could enable a merchant to send personalized messages to consumers near or in the store. The app also lets stores send coupons to specific types of consumers, such as by age or gender

An initial test with McDonald’s generated positive results, Alipay says McDonald’s sent 2 million free sundae coupons to women ages 18 to 35 who were within 3,000 meters of a McDonald’s restaurant in five Chinese cities. 32% of recipients redeemed the coupon within 20 days and the fast-food chain gained 1 million followers on its social media account, according to Alipay.   

Only three shopping malls are using the app so far. Alibaba says it plans to expand to 500 shopping malls in 15 cities this year.

Alibaba is not alone in helping bricks-and-mortar stores go digital. Last month, Alibaba’s two major Chinese rivals, social media company Tencent Holdings Ltd. and search engine Baidu Inc., announced plans to launch a similar service through and its app, working with Wanda Group, a major operator of shopping malls in China. The three companies said they plan to invest 20 billion yuan ($3.22 billion) in over the next five years.  




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