Alibaba: Instant Commerce Offering Exceeds 40 Million Daily Orders

Alibaba’s instant commerce platform has reportedly crossed the 40-million-daily-orders mark within a month of launch.

As Reuters noted in a report Monday (May 26) on this milestone, the platform brings merchants from the eCommerce giant’s food delivery arm Ele.me onto its main domestic shopping app, Taobao, making deliveries within 60 minutes.

The report added that this is part of a larger push by Chinese online platforms to invest in what has been called “instant retail.”

Alibaba launched the service in late April and discussed it on its earnings call earlier this month.

Fan Jiang, CEO of the company’s eCommerce segment, argued that the company has some specific advantages, having established its delivery capabilities for years, while also investing in and developing the Freshippo grocery chain.

“One thing to note about this instant retail market is that it’s a huge market because basically every person in China, every consumer in China will have demands for instant commerce,” Jiang said. “Today, it could be a market of some say 500 million to 600 million consumers. Going forward, that could easily be 1 billion consumers.”

He added that Alibaba also had an “extremely mature and experienced merchant base” in place … and “extremely robust and mature logistics system to support instant commerce.”

It’s a time of tough competition in this space in China, per an earlier Reuters report this month, with companies like JD.com and Meituan also investing in instant retail.

“The competition is so intense, there’s not a lot of incremental growth opportunities, so everybody is moving into everybody else’s territories, and instant retail is the latest example of that,” Jason Yu, general manager at CTR Market Research, told Reuters.

Research by PYMNTS Intelligence has found that services like grocery delivery remain popular with consumers, even when they’re feeling paycheck pressures.

According to the report “The Price of Time: When Consumers Opt for Convenience,” while 74% of households making $50,000 or less per year live paycheck to paycheck, 59% of consumers in that income bracket use convenience services.

“As to the categories with the most appeal: The data show grocery and restaurant delivery are the most popular convenience services, each with 55% adoption overall across the general population,” PYMNTS wrote in March.

“Consumers living paycheck to paycheck without issues paying their bills are the most likely to have used grocery delivery or pickup at least once in the last year, at 59%. Half of consumers not living paycheck to paycheck likely used grocery delivery.”