Alibaba is planning to invest $305 million in a Chinese discount supermarket, Sanjang Shopping Club Ltd, which operates 160 stores across Eastern China. Similar moves from online retail giants Alibaba and Amazon suggest that both are trying to drive growth in their grocery business by embracing a hybrid online and offline model.
A pure e-commerce approach might not alone be feasible for long-term growth, but the online market is still on an upward track. According to a recent study by Morgan Stanley, in 2016 34 percent of online shoppers are expected to buy grocery over the Internet, up from 21 percent last year. The same research reveals that 67 percent of consumers who have never shopped for groceries online have not done so because they still want to hand-pick their products in-store.