JD.com: the robots are coming! And they want to sell you handbags
Speaking to retail executives on Tuesday in Madrid, as part of the annual World Retail Congress, Richard Liu had an interesting message: the robots are coming, and they want to sell you stuff. Liu is the CEO of China’s second-biggest Ecommerce platform, JD.com, so he’s worth listening to. His prognosis for the retail industry is that robots will eventually replace human workers in shops worldwide.
JD.com’s share price has risen by 22% over the past 12 months
SOURCE: Yahoo Finance
Liu is not speculating idly. JD.com has invested heavily in drones, robotics and automation, as well as an extensive logistics network. Liu’s business philosophy mandates this investment as an eventual way to improve the sector, and stay ahead of competitors. Explaining that philosophy, he told listeners that: “we have to make a lot of innovation every day and never stop. Reduce cost and improve customer experience. That’s all.”
Liu said that “sooner of later, our entire industry will be operated by AI (artificial intelligence) and robots, not humans.” Nonetheless, he thinks western brands will be temporarily shielded from this change. He said that the loyalty that these brands have built up with consumers over decades will result in a slower transformation. Not so in China, he says, where shoppers are eager to embrace the next big thing, and more demanding when it comes to delivery speed.
Overall, Liu says, it could take another decade for shoppers to be ready for automated stores – and for the technology to live up to its promises. Still, Amazon’s already opened one checkout-free grocery store. Perhaps the future is closer than we think…
Dominion holds JD.com in its Global Trends Ecommerce Fund.
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