Alibaba Group has expanded same-day and next-day deliveries through partners in major Chinese cities as it increased sales revenues by one third in an “outstanding” final quarter of 2015.
The Chinese e-commerce giant said average delivery times had been reduced thanks to efficiency gains in dispatch of parcels, inventory planning and data analytics, resulting in improved customer satisfaction.
“We continue to fortify our market leadership in both major cities and rural areas in China. Through our logistics information systems affiliate Cainiao and its partners, customers enjoy same-day delivery in Beijing, Shanghai, Chengdu, Guangzhou, Hangzhou, Suzhou and Wuhan, and next day delivery was offered in 88 cities in the December quarter, an increase from 41 cities in the June quarter,” Alibaba said in its Q4 results announcement.
“In the December quarter, our last-mile delivery partner YTO Express and Best Logistics launched a service that guarantees the delivery time to customers, working closely with Cainiao to define the service standard and integrate data flow to enable delivery efficiency,” it added.
“Our category specific logistics strategy is bearing fruit, with specialty services that differentiate our shopping experience from that of our competitors. Through Cainiao, we cooperated with RRS, our joint venture with Haier, to increase warehouse capacity dedicated to large appliances, allowing for more efficient inventory placement strategies for merchants. Integration of Suning’s logistics systems with Cainiao is complete, allowing for increased parcel tracking and improving customer experience. Suning cooperates with Cainiao to fulfill bulky items for Tmall Supermarket and offers installation and after-sales services through its retail outlets and service locations.”
Alibaba Group increased overall revenues by 32% to RMB34.5 billion (US$5.3bn) in Q4, 2015, including a 35% rise in revenues for its China retail marketplaces to RMB28.7 billion (US$4.4bn). The number of active buyers on the China retail marketplaces increased by 21 million to 407 million customers while the value of goods sold through them increased by 23%.
This included the massive Singles Day online shopping event on November 11 when over 115 million buyers placed 467 million delivery orders within 24 hours. This was about ten times the group’s daily volumes.
“Alibaba Group had an outstanding quarter, reaching a milestone of over 400 million annual active buyers and continuing our unrivaled leadership in mobile. Our proven ability to deliver an unparalleled consumer experience and to help merchants attract, engage and retain buyers will drive future growth in our core business,” said CEO Daniel Zhang.
“We remain focused on our top strategic priorities, including global imports, rural expansion, increasing our footprint in first-tier Chinese cities and building a world-class cloud computing business.”
Outlining various business developments, Alibaba said it had gained market share in Beijing, Shanghai, Guangzhou and Shenzhen through, among other things, Tmall Supermarket, where consumers make high-frequency purchases in groceries and everyday items, supported by delivery services by our logistics partners who offer same day delivery in seven cities and next-day delivery in 88 cities. The Tmall marketplace generated strong growth in sales of consumer electronics.
Discussing its international operations, the group said: “Our globalization strategy is focused on cross-border commerce that allows international brands and retailers to sell online to Chinese consumers. We are helping international brands, retailers and small businesses recognize the power of the Alibaba platform as a gateway to China consumers.”
