Text | Zhijian Time, author | Linze, editor | 308
On December 3, 2017, in an interview with CCTV at the Fourth World Internet Conference, Lei Jun talked about the “new retail” that was all the rage at the time. He emphasized, “I was the first person in the country to speak about new retail. I spoke at one place in the morning, and Jack Ma spoke at another venue in the afternoon.”
Then, Lei Jun added, “Maybe Ali has a loud voice and talks more.”
In fact, whether it was Lei Jun or Jack Ma who was the first to propose the concept of “new retail” in China has become completely unimportant with the passage of time.
Just thinking back to those days,Under Jack Ma’s cheers, Alibaba is indeed the core driving force behind the popularity of the term “new retail”; Not only that, it also relied on its huge size and presence to enter the game, and has set off a wave of new retail business in the entire society.
Now, the trend is ruthlessly receding – Jack Ma, who has rarely appeared in public, did not mention the term new retail at all in his few intranet speeches.
And at this timeAlibaba himself is also busy trying to get out of it.
Physical retail business becomes abandoned
In less than a month, Alibaba has completed the sale of its two major physical retail-related assets.
The first one is Yintai.
On December 17, 2024, Alibaba announced on the Hong Kong Stock Exchange that the company and another minority shareholder agreed to sell 100% of Intime’s equity to a buyer consortium composed of members of Youngor Group and Intime’s management team – after the sale Previously, Alibaba owned 99% of Intime’s shares.
Alibaba said in the announcement that the total proceeds from the sale of Intime were approximately RMB 7.4 billion (USD 1 billion), while Alibaba expected to record a loss of approximately RMB 9.3 billion (USD 1.3 billion) from the sale of Intime.
The second one is Sun Art Retail.
On the evening of January 1, 2025, Alibaba once again announced on the Hong Kong Stock Exchange that its subsidiaries and NewRetail had reached a deal with Dehong Capital to sell all its shares in Sun Art Retail (a Hong Kong-listed company) for a maximum of approximately HK$13.138 billion. Together they account for 78.7% of the issued shares of Sun Art Retail.
In the announcement, Alibaba stated that the estimated loss attributable to shareholders arising from the sale was approximately RMB 13.177 billion.
However, based on Alibaba’s past investments in Sun Art Retail, outsiders calculated that Alibaba spent as much as HK$50.4 billion in controlling Sun Art Retail.Therefore, Alibaba suffered a loss of HK$37.262 billion based only on the difference between the amount paid and returned before and after.
This is not to mention the manpower, technology, management and other costs that Alibaba has invested in Sun Art Retail in the past few years – these costs also include time costs.
certainly,These costs have been sunk, and Alibaba’s actions have been quite decisive.
In fact, the outside world has already had enough expectations for Alibaba’s sale of related assets such as Intime and Sun Art Retail, and there is no surprise. What triggered the discussion was only the takeover party – the reason behind this is very simple, because these sales The actions have been decided.
As early as February 2024, Cai Chongxin, chairman of the board of directors of Alibaba Group, stated in the third quarter results of fiscal year 2024:
Alibaba still has many traditional physical retail businesses on its balance sheet. These are not core businesses. It would be reasonable to exit. However, considering the current challenging market conditions, it will take time to achieve this.
In fact, the sale of the physical retail business itself is only part of Alibaba’s new round of strategic adjustment process starting in September 2023. According to Cai Chongxin, Alibaba exited 17 in the first nine months of fiscal year 2024. With non-core assets of US$100 million, a team has also been established to study how to sell shares of related listed companies.
So, for Alibaba in 2024,These physical retail businesses have become “core assets” that need to be abandoned.
Judging from the results, despite the bad environment, Alibaba still completed the sale of its two major physical retail assets, Intime and Sun Art Retail, less than a year after Tsai Chongxin’s speech – even though these businesses were once very important, Moreover, it has caused tens of billions of losses in total, but Alibaba, based on strategic focus and strategic contraction, can no longer take care of that much.
then,Intime and RT-Mart, which belongs to Sun Art Retail, have completely become Alibaba’s “abandoned sons”——It’s as if the story of “eachother” between them has never existed.
Jack Ma’s new retail blueprint is shattered
Looking back, all the connections between Alibaba, Intime and Sun Art Retail are due to Jack Ma’s new retail strategy.
On October 13, 2016, Jack Ma appeared on the stage of the Yunqi Conference as the chairman of the board of directors of Alibaba. In his speech, he mentioned the five major industries including new retail, new finance, new manufacturing, new technology, and new energy. Strategy, also known as the “Five New”, among which new retail has become the top priority.
Regarding “new retail”, Jack Ma’s original words at the time were as follows:
The era of pure e-commerce will soon be over.
In the next ten or twenty years,There is no such thing as e-commerce, only new retail.
In other words, online, offline and logistics must be combined to create true new retail. Offline companies must go online, and online companies must go offline. Only when online, offline and modern logistics are combined can we truly create new retail.
In fact, when Jack Ma talked about new retail, Alibaba had already begun to extend its online business to offline businesses – for example, after it started cooperating with Intime in May 2013, and in March 2014 In June 2016, it invested HK$5.37 billion in Intime and became the largest shareholder of Intime Commercial with a 27.9% shareholding in June 2016.
But these are just a prelude – in fact, after Jack Ma proposed the concept of new retail, Intime quickly made an unprecedented move to cooperate with Alibaba’s “new retail” strategy.
On January 10, 2017, Intime Commercial announced on the Hong Kong Stock Exchange that Intime would be privatized. According to the announcement, Alibaba became Intime’s controlling shareholder after the privatization, and its shareholding ratio is expected to increase to approximately 74%. On the same day, affected by this news, Intime Commercial’s Hong Kong stock price skyrocketed by nearly 40%.
As for why Yintai was pushed toward privatization, then-Alibaba CEO Zhang Yong responded:
The total size of China’s retail industry has reached US$4.5 trillion and is growing at an annual rate of 10.7%. Alibaba Group is working with offline retailers to reconstruct traditional business formats, innovate user consumption experience, and use practical actions to embrace the long-term development opportunities brought by new retail.
It can be seen that Intime has become a key link in Alibaba’s new retail layout.
Then in 2017, Alibaba used its role as an online platform to continue to make more extensive capital arrangements for the offline retail market. For example, in May 2017, it acquired 18% of the equity of Lianhua Supermarket and became the second largest shareholder. In September 2017, it signed an equity transfer agreement with Xinhuadu Group.
But its most important layout under the new retail strategy this year is Sun Art Retail.
On November 20, 2017, Alibaba Group announced that it would invest approximately 22.4 billion Hong Kong dollars to directly and indirectly hold 36.16% of the shares of Sun Art Retail. At that time, Sun Art Retail’s annual revenue exceeded 100 billion, and it owned RT-Mart and Auchan. The brand was the largest hypermarket operator in China at the time.
At that time, Alibaba officially described the transaction this way: This means that China’s largest supermarket groups, represented by RT-Mart and Auchan, will fully embrace new retail, and Chinese commerce will also fully enter the new retail era. In this equity acquisition, both parties shouted the slogans “Alibaba Sun Art Retail’s historic handshake” and “The future of new retail is here”.
The tone here is so high that “new retail” has become the most popular.
Suddenly, the slogan New Retail spread both online and offline, and even various business books with the theme of “New Retail” filled bookstores.
Three years later – in October 2020, although the haze of the epidemic has not yet dissipated, Alibaba still chose to spend HK$27.957 billion to further increase its holdings in Sun Art Retail, directly and indirectly holding 72% of its equity. Sun Art Retail has become a consolidated subsidiary of Alibaba Group – which is exactly the same as Alibaba’s investment strategy of first acquiring shares and then annexing.
This time, in the official statement of the acquisition, Alibaba stated that the digital experience of Sun Art Retail in new retail in supermarkets has been opened to Sanjiang Shopping, Xinhuadu, Zhongbai, CP Lotus, Greenland Selection, etc. Offline supermarkets, helping more than 50 supermarkets and retail brands across the country promote digital transformation.
But from today’s perspective,How high the tone was at that time, how lonely the current situation is.
Now in 2025, after experiencing the vicissitudes of life, it is difficult to hear Jack Ma’s speeches in public. Zhang Yong, who was driving Alibaba’s new retail business, has left. Alibaba has put its business focus online again. Intime and Sun Art Brick-and-mortar retail assets like retail are already changing hands in a state of decline.
Under this circumstance, new retail has become a familiar but unfamiliar term.
that’s all,The grand new retail blueprint drawn by Jack Ma for Alibaba has now become a piece of cake.
When Alibaba regroups online
Frankly speaking,From a conceptual perspective, “new retail” is a very correct direction.
For example, Jack Ma emphasized that new retail should be a combination of online, offline and logistics. In fact, after several years of development, China’s physical retail industry as a whole has embraced digitalization and the Internet. On the other hand, some Internet giants who once wanted to invest offline have not achieved success. Very good results, such as JD.com to Yonghui.
Of course, this is even more true for Alibaba to Intime and Sun Art Retail.
To a certain extent, it is easier for offline companies to go online, but it is more difficult for online companies to go offline; this is a common problem faced by all Internet companies – to put it simply,It is easy to go from real to virtual, but difficult to go from virtual to real.
Even a company as strong as Alibaba in terms of operational capabilities would find it difficult to break this curse.
Looking back, when Jack Ma proposed “new retail” at the Yunqi Conference, both Alibaba and Jack Ma himself had enough courage and confidence to demand changes in the physical retail industry.Objectively speaking, the physical retail industry does need to embrace the changes brought about by technology.
In fact, this is also the real background for the concept of new retail to be widely recognized and attract industry attention.
But the problem is,Jack Ma pointed out the direction, but did not give a specific path to reach this direction.
In other words, after Jack Ma gave a general direction that he thought was correct, he became a hands-off shopper on Alibaba’s new retail road. Zhang Yong, who once served as Alibaba CEO for a long time, is a firm operator of Alibaba’s new retail strategy, but he underestimated the difficulty of physical retail itself.
From a basic logic point of view, the in-depth cultivation and refined operation of physical retail are indeed diametrically opposed to the rapid development and traffic-first thinking pursued by Internet companies.From a user’s perspective, the really important things such as product, experience, and price are easily overlooked.
As Tsai Chongxin, chairman of Alibaba’s board of directors, said in an interview in February 2024:
Over the past few years, when we did our internal look and self-reflection, we knew that Alibaba was lagging behind because we had forgotten who our real customers were. Our customers are people who use the app to shop, and we’re not giving them the best experience.
By the same token, Alibaba is incorporating Intime and Sun Art Retail (RT-Mart) into its business systemdespite the integration of online and offline, it did not bring a better experience to the corresponding users – this is the core reason why it was abandoned by users.
What needs to be made clear is that physical retail is a key part of Alibaba’s new retail strategy, but it is not the whole story.
After all, from the perspective of Alibaba’s own business system, Hema, which once spawned 12 retail formats, was once a key tentacle in Alibaba’s new retail layout.
It can be said to be a new retail business born from 0 to 1 within the Alibaba system; currently under the leadership and adjustment of the new head, although the label of new retail is no longer emphasized, it is showing improvement to a certain extent. situation–For Alibaba, it is still important.
From an external perspective, although “new retail” has not achieved the expected success within the Alibaba system, seven or eight years after Jack Ma proposed this concept, it has indeed brought the concept of online and offline integration and digitalization into to the entire social retail industry,Including foreign supermarkets like Sam’s and local retail brands like Fat Donglai, all of them have benefited from this.
As the saying goes,Although new retail has not become Alibaba’s “Wang Xie Tang Qian Yan”, it has “flyed into the homes of ordinary people” at the conceptual level.
Looking back, to a certain extent, Alibaba’s strategic abandonment of Intime, Sun Art Retail and other businesses under the leadership of a new round of management is also a sign of Alibaba’s return to itself and its main business in a new round of self-adjustment. The right choice to return user value.
At the same time, with this choice, new retail has long become a term that is no longer mentioned by Alibaba.
Jack Ma’s rallying cry at that time has also been regarded as the most embarrassing scene in Alibaba’s entire process from the launch of new retail to the withdrawal of new retail in historical reviews.
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