Alibaba Group is rolling out a members-only hypermarket chain called Store X to target affluent families in China, expanding the chain’s footprint with eight new stores this year.
The concept is the latest big-box format at Alibaba’s grocery retailer Freshippo. Its scale is roughly twice the size of a regular Freshippo store and it sells organic products sourced directly from farms by working with Tmall and Taobao.
“Store X offers a membership-driven experience on top of existing Freshippo supermarkets,” said Hou Yi, CEO of Freshippo. “The combination of different store formats can complement one another to serve a city’s fast-moving and upgraded consumption needs.”
Located in Shanghai, the first Store X outlet turned profitable within two months of opening. Members spend an average of US$152 per visit to a Store X, outpacing purchases at a conventional store, according to Freshippo. With two stores opened last week, Alibaba said it will open eight more Store X locations this year, increasing its store number to 11.
“Built on top of the Freshippo app, Store X targets a group of highly affluent and young shoppers who are digitally savvy and are willing to spend more for better services and shopping experiences,” said Jiong-Jiong Yu, a senior retail analyst at UK-based research firm IGD.
