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Starbucks joins forces with Alibaba to launch delivery service in China

|Jul 30|magazine4 min read

The global coffee company, Starbucks, has joined forces with Alibaba Group’s Ele.me unit to launch a delivery service in China, South China Morning Post reports.

Following a sales decline in the Asian country, Starbucks has opted to embrace on-demand local services to ensure the firm keeps up with the latest trends and continues to attract customers.

Belinda Wong, the chief executive of Starbucks’ Chinese business, said: “Delivery as a whole is becoming a lifestyle ritual in China, and consumer behaviours are changing.”

It is anticipated that the service will begin in the autumn in Beijing and Shanghai with the possibility of expanding to other cities, if successful.

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During its most recent quarter in China, the firm reported a 2% decline in comparable-store sales.

According to the latest estimate by research group, Euromonitor International, China’s coffee market has been dominated by Starbucks as the giants hold 80% of the market as of 2017.

Ele.me is utilising Starbucks with the aim of expanding beyond transporting meals to customers into other on-demand services.

It has been found that the interest for on-demand local services is growing in China as it acts as a gateway to other services, such as online payments, in addition to providing a greater insight into customers spending habits.