Starbucks will begin piloting delivery services from 150 stores in key locations in Beijing and Shanghai in September, with plans to expand to more than 2000 stores across 30 Chinese cities by the end of 2018.
The coffee company is partnering with Ele.me, the on-demand food delivery platform with 3 million registered riders that Alibaba acquired earlier this year for US$9.5 billion, to facilitate deliveries.
Starbucks is also partnering with Alibaba’s Hema supermarket chain to establish dedicated ‘Starbucks Delivery Kitchens’ within their locations. The kitchens will support the coffee company’s own stores to fulfil orders for delivery.
The coffee chain will make use of Hema’s consumer insights and fulfilment experience to tailor its offering to each market and make decisions about future store locations.
Starbucks also plans to open a first-of-its-kind virtual store in China, which will act as a centralised online hub for a range of customer interactions.
The virtual store will enable consistent and personalised digital experiences across the Starbucks app as well as Alibaba’s customer-facing apps, including Taobao, Alipay, Tmall and Koubei.
The coffee company’s expansion in China comes less than a year after it shuttered its online store in the US.
Indeed, Starbucks chief executive and president Kevin Johnson said the company is innovating faster in China than anywhere else in the world.
“Starbucks China is one to watch, and I have full confidence in the team that will bring the new innovation behind the Starbucks Experience to life,” he said.
The partnership is the latest win for Alibaba’s New Retail strategy, which focuses on integrating offline and online retail practices into one seamless offering.