Starbucks and Alibaba strike a deal for coffee in China

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The Starbucks Coffee Company and Alibaba have announced a deep, strategic “New Retail” partnership that they say will enable a seamless Starbucks experience and transform the coffee industry in China.

Collaborating across key businesses within the Alibaba ecosystem, including Ele.me, Hema, Tmall, Taobao and Alipay, Starbucks announced plans to pilot delivery services beginning in September 2018 and establish “Starbucks Delivery Kitchens” for order fulfillment and integrate multiple platforms to co-create an unprecedented virtual Starbucks store – an unparalleled and even more personalised online Starbucks Experience for Chinese customers.

Starbucks is more than a destination for premium coffee and we share the same vision to pioneer a new coffee culture and lifestyle through innovation and technology. Alibaba is thrilled to expand our existing partnership with Starbucks by leveraging our cutting-edge New Retail infrastructure and digital power to enable an unprecedented experience for consumers. This partnership is again a testament to the success of our New Retail strategy.
– Daniel Zhang, Chief Executive Officer of the Alibaba Group

The strategic partnership is part of what Alibaba is calling its New Retail push, which aims to transform how commerce is conducted by merging online and offline experiences. New Retail was introduced by Alibaba in 2016 and has since become a hallmark strategy of the retail industry in China, they say.

Specifically, by working with Ele.me, a big Chinese on-demand food delivery platform with 3 million registered delivery riders, Starbucks will pilot delivery this September in 150 stores located in key trade zones in Beijing and Shanghai with plans to accelerate and expand its delivery program to more than 2,000 Starbucks stores across 30 cities by the end of calendar year 2018.

It is heartening that these two companies – one from China and another from the United States – are cooperating so closely when we are increasingly seeing trade friction and likely greater sanctions between the two and tensions continue to rise. We hope that calmer minds will prevail.

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