Starbucks to use Alibaba to froth up presence in China

Seattle coffee company agrees partnership with Chinese cloud firm to expand delivery services across the country

Starbucks has struck a deal with Chinese cloud giant Alibaba to boost the coffee company's digital and physical presence in China.

The Seattle coffee chain will use all of Alibaba's properties, including delivery platform Ele.me and supermarket chain Hema, to expand delivery services throughout China, Starbucks CEO Kevin Johnson told CNBC.

"We're going to integrate a Starbucks virtual store into all of the Alibaba Group properties," said Johnson. "This means that a customer that uses Alipay or Taobao or Tmall or Hema has an integrated Starbucks virtual store similar to the mobile app embedded right into that experience. That opens up 500 million or more active users of those apps that will have access to Starbucks."

The Seattle company mostly uses Azure for its cloud infrastructure in the US, Microsoft CEO Satya Nadella is even a Starbucks board member. But it's opted for a partnership with Alibaba, rather than Azure, or the top cloud company AWS, in China as Alibaba have a broader range of services in the country that Starbucks can utilise.

Starbucks will also use Ele.me, a food delivery platform that Alibaba acquired earlier in the year and open 150 stores in Shanghai and Beijing before expanding delivery to 2,000 stores in 30 other Chinese cities before the end of 2018.

The coffee company also plans to build up to 600 "Starbucks Delivery Kitchens" in Hema's supermarkets, that will service delivery orders for surrounding areas over the next seven years.

China is one of Starbucks biggest markets and its dominance has come under attack from Chinese startup Luckin Coffee, who have rapidly grown from two stores in January to 800 branches across the country.

Starbucks has been criticized for being slow to adapt to digital trends in China, but its partnership with Alibaba will see it pilot delivery services as soon as next month.

Picture: Shutterstock

Featured Resources

BCDR buyer's guide for MSPs

How to choose a business continuity and disaster recovery solution

Download now

The definitive guide to IT security

Protecting your MSP and your customers

Download now

Cost of a data breach report 2020

Find out what factors help mitigate breach costs

Download now

The complete guide to changing your phone system provider

Optimise your phone system for better business results

Download now

Recommended

Vodafone and Google Cloud to develop global data platform
cloud computing

Vodafone and Google Cloud to develop global data platform

3 May 2021
The total economic impact of optimising and managing your hybrid multi-cloud
Whitepaper

The total economic impact of optimising and managing your hybrid multi-cloud

30 Apr 2021
Uncovering the hidden costs of cloud migration
cloud computing

Uncovering the hidden costs of cloud migration

29 Apr 2021
Lenovo and Nutanix introduce hosted desktop as a service solution
virtual desktop

Lenovo and Nutanix introduce hosted desktop as a service solution

20 Apr 2021

Most Popular

Dell patches vulnerability affecting hundreds of computer models worldwide
cyber security

Dell patches vulnerability affecting hundreds of computer models worldwide

5 May 2021
16 ways to speed up your laptop
Laptops

16 ways to speed up your laptop

29 Apr 2021
How to move Windows 10 from your old hard drive to SSD
operating systems

How to move Windows 10 from your old hard drive to SSD

30 Apr 2021