**Intime Department Store may be just the beginning, the past glory and pain are no longer mentioned, Ali has entered a new cycle.
Text |Managers are integrated with the center
A few days ago, it was reported that Alibaba is considering Intime Department Store and has been in contact with several companies to assess their interest in acquiring Intime.
According to the report, Alibaba has started relevant discussions before and after Tsai Chongxin became chairman of the board of directors of Alibaba Group in September 2023. Alibaba has been in contact with several potential buyers to see if they are interested in acquiring Intime Department Store, one of which was already in talks last month.
At present, neither Alibaba nor Intime Department Store has responded to the above information. However, whether it is true or not, judging from Alibaba's recent actions, it may be reconsidering its "new retail" strategy.
In 2016, Jack Ma officially proposed the "new retail" strategy, that is, "a data-driven pan-retail format centered on consumer experience". Subsequently, Daniel Zhang took over the mantle and began to explore a new retail model that connects online and offline, and led a number of major investment decisions of Alibaba, preparing to use e-commerce experience to transform offline business one by one.
The first is the privatization of Intime Department Store: in 2014, Alibaba took a stake in Intime Department Store, becoming the second largest shareholder after Yintai founder Shen **; In 2015, Alibaba increased its stake in Yintai ** to become the largest shareholder, with Daniel Zhang as CEO; In 2017, Alibaba privatized Yintai for RMB17.7 billion, with an acquisition premium of more than 40%.
Second, from 2017 to 2021, Alibaba acquired a 79% stake in Sun Art Retail through several rounds of acquisitions of shares from founding shareholders and public shares in the open market (with a total investment of more than 50 billion yuan), thus indirectly acquiring RT-Mart.
Thirdly, in order to cope with the competition of Meituan, Alibaba has continuously invested in Ele.me since 2016, and finally completed a wholly-owned acquisition in 2018, with a total investment scale of 117$500 million.
Of course, Alibaba does not want to do retail in person, but tries to transform Intime Department Store and RT-Mart into "Hema Fresh" in their respective fields, and then integrate offline traffic into part of Alibaba's business ecosystem, treating offline department stores as fitting rooms for online users, which in turn can speculate on demand based on online data and guide the operational decisions of offline merchants.
At the time of the acquisition of Yintai Retail, Daniel Zhang said: "Yintai Commercial will be a major ship in the fleet of Alibaba Group, with the mission of transforming and upgrading online and offline retail department stores. And it has repeatedly emphasized that Alibaba has "sufficient confidence, a clear path and all-out investment" in the promotion of the new retail strategy.
However, to date, the role played by Yintai has not been highlighted, and the new retail strategy has gradually fallen into an embarrassing situation.
On December 14, 2020, the State Administration for Market Regulation announced that in accordance with the provisions of the Anti-Monopoly Law, the State Administration for Market Regulation conducted an investigation into the illegal implementation of the concentration of undertakings in Alibaba Investment's acquisition of Yintai Retail (Group)**'s equity in accordance with the law, and imposed an administrative penalty of a fine of 500,000 yuan on Alibaba Investment***. Combined with the impact of the three-year epidemic on offline consumption and the reversal of consumption trends, Alibaba's core e-commerce revenue has slowed down, and Chinese concept stocks have also collectively fallen into a downturn.
In this context, Ali almost no longer focuses on new retail, and is unable to mention it.
Who else do you want to sell.
Fundamentally, in the semi-annual report ended September 30, 2023, Alibaba's revenue increased by 11% year-on-year to RMB 4,589$4.6 billion; Net profit was RMB5969.6 billion yuan, a reversal of the same period in 2022 21A loss of 6.9 billion.
There are various signs that Alibaba's operating performance will begin to stabilize and rebound from 2023.
Fundamentals are a key factor for investors to decide whether to hold Alibaba for the long term, and the return to revenue and profit growth suggests that Alibaba remains a healthy Chinese internet giant.
The picture is not entirely rosy, and the giant is facing a lot of competitors.
In 2023, Alibaba's market capitalization will be surpassed by Pinduoduo, which has relied on Temu to reap considerable growth in overseas markets and continue to eat into Alibaba's market share amid the continued volatility of the macroeconomic environment.
Based on this, in 2023, Jack Ma will re-point out three directions for Ali -
Return, that is, the energy is concentrated on the main business of e-commerce, and the diversified business is focused on shrinking; Return to the user, that is, the user first, pay attention to the user's low-price mentality. In the past, Taotian's consumption upgrade was actually based on merchants first, attracting merchants to do branding on the platform, although it has achieved certain results, but it has allowed Pinduoduo's savage growth; Returning to the Internet, that is, attaching importance to online and cloud services, etc., has to make trade-offs in forming a drag on offline asset-heavy business.
Therefore, it can be seen that Alibaba has made a series of adjustments in 2023, from the drastic "one split six", to the suspension of the listing of Hema and Alibaba Cloud, and the contraction and focus on the main business.
The impact of the changes on Alibaba's strategy execution and performance will take time to answer, but there is no doubt that Alibaba's focus on its main business has also put non-core businesses other than e-commerce and logistics (including cloud computing) into a delicate situation.
According to ** report, in 2023, Ele.me, Freshippo, Youku, and RT-Mart all reported that they were planned**, although Alibaba denied it, but these businesses are indeed poor in financial performance, and even are still losing money.
After the organizational change, Alibaba's positioning has changed to that of an investment holding company, and the function at the group level is to manage assets and funds. As an "investment holder", it is necessary for Alibaba to sell off "bad assets" or increase the value of the group's asset portfolio.
And Wu Yongming also said, "No matter how successful the business model was in the past, we must turn the page to zero and awaken the mentality of starting a new business." ”
In addition to e-commerce and logistics, some diversified businesses that are not performing well do not rule out the possibility of being recouped by Ali, and the Manager Finance Center will continue to pay attention to Alibaba's actions in 2024.
Comprehensive Articles:1"Who else does Ali want to sell besides Yintai", China Entrepreneur Magazine.
2."What's wrong with Alibaba", newnewthing
3."Ma Yun Tsai Chongxin increased his holdings in Alibaba, another bottoming signal for Chinese concept stocks? Barron's.