SoftBank Invests Billions In Food Delivery As It Integrates Further Into Grocery Stores
Japanese investment giant SoftBank is throwing its weight behind one of the most significant emerging industries in the world.
Alibaba, China's own e-commerce giant, is raising capital for a $3B to $5B funding round led by SoftBank Vision Fund, Bloomberg reports. SoftBank will be at the forefront of the investment, but it is also recruiting other investors such as venture capital firms.
Alibaba will use the capital infusion to merge online food ordering and delivery app Ele.me with its in-house brand Koubei that provides a similar service. Also included in the merging of brands will be Hema, Alibaba's new chain of brick-and-mortar grocery stores, CNBC reports.
More unified with Alibaba's central brand than Amazon is with Whole Foods in the early days after acquisition, Hema stores are purpose-built for online ordering, both for delivery and pickup.
2/ Each of the 50 Hema grocery locations enable delivery to addresses in the delivery zone within 30 minutes. Pickers gather items in 7 minutes or less of receiving an order. All the orders get placed on conveyor belts to go out for delivery pic.twitter.com/DQM1919SyL
— Rishi Taparia (@taps) August 6, 2018
6/ Pricing is displayed and can be changed dynamically via wifi-connected, e-ink price tags. If something gets cheaper or more expensive, as determined by supply and demand both online and offline, the price displayed in store will change automatically pic.twitter.com/pd6UAFSuu0
— Rishi Taparia (@taps) August 6, 2018
8/ Most checkout takes place through a self checkout kiosk that can automatically recognize product. Payment happens via the Hema app (leveraging Alipay tech). Kiosks all have cameras at the top - eventually facial recognition will pull up your account as you walk up pic.twitter.com/jKzB3v12Yj
— Rishi Taparia (@taps) August 6, 2018
Amazon is also taking further steps to bring Whole Foods more into the e-commerce fold with the introduction of curbside pickup destinations for online orders for Amazon Prime members, the Wall Street Journal reports. The service is being rolled out at stores in Sacramento, California, and Virginia Beach, Virginia, at first, with more locations to follow.
The move to add pickup services to physical locations is an effort to keep the brick-and-mortar footprint viable as more shopping is done online. While the trend is more pronounced in China, where online-to-offline revenue at brick-and-mortar stores jumped 72% last year, according to CNBC, the WSJ reports that groceries accounted for 15% of online food and beverage ordering in the U.S. last year.
CORRECTION, AUG. 10, 3:00 P.M. ET: A previous version of this story incorrectly listed where Softbank is based. The investment giant is a Japanese conglomerate headquartered in Tokyo. The story has been updated.
