0:00:00.560,0:00:02.520
This is my nephew,

0:00:03.280,0:00:04.576
Yuan Yuan.

0:00:04.600,0:00:06.096
He's five years old,

0:00:06.120,0:00:07.400
super adorable.

0:00:08.360,0:00:10.336
I asked him the other day,

0:00:10.360,0:00:12.720
"What would you like[br]for your birthday this year?"

0:00:13.360,0:00:17.440
He said, "I want to have[br]a one-way mirror Spider-Man mask."

0:00:18.000,0:00:20.776
I had absolutely no idea[br]what he was talking about,

0:00:20.800,0:00:22.776
so I said, "Wow, that's really cool,

0:00:22.800,0:00:24.372
but how are you going to get it?"

0:00:25.120,0:00:28.016
He told me, without a blink of his eyes,

0:00:28.040,0:00:32.119
"I'm going to tell my mom[br]and make a wish before I go to bed.

0:00:32.759,0:00:34.720
My mom will go to shake her mobile phone.

0:00:35.400,0:00:39.680
The next morning, the delivery uncle[br]will give it to me when I wake up."

0:00:41.320,0:00:43.296
I was about to tease him,

0:00:43.320,0:00:45.096
but suddenly I realized

0:00:45.120,0:00:47.456
he was simply telling me the truth,

0:00:47.480,0:00:51.616
the truth of what shopping[br]looks like for this generation.

0:00:51.640,0:00:55.256
If you think of it,[br]for a child like Yuan Yuan,

0:00:55.280,0:00:57.576
shopping is a very different idea

0:00:57.600,0:01:00.496
compared to what[br]my generation had in mind.

0:01:00.520,0:01:02.776
Shopping is always done on mobile,

0:01:02.800,0:01:04.879
and payment is all virtual.

0:01:06.000,0:01:10.480
A huge shopping revolution[br]is happening in China right now.

0:01:11.120,0:01:14.976
Shopping behaviors,[br]and also technology platforms,

0:01:15.000,0:01:17.856
have evolved differently[br]than elsewhere in the world.

0:01:17.880,0:01:21.776
For instance, e-commerce[br]in China is soaring.

0:01:21.800,0:01:24.616
It's been growing at twice the speed[br]of the United States

0:01:24.640,0:01:27.280
and a lot of the growth[br]is coming from mobile.

0:01:27.920,0:01:32.696
Every month, 500 million consumers

0:01:32.720,0:01:34.816
are buying on mobile phones,

0:01:34.840,0:01:36.576
and to put that into context,

0:01:36.600,0:01:39.816
that is a total population[br]of the United States,

0:01:39.840,0:01:42.280
UK and Germany combined.

0:01:43.040,0:01:46.896
But it is not just about[br]the scale of the e-commerce,

0:01:46.920,0:01:51.496
it is the speed of adoption[br]and the aggregation of the ecosystems.

0:01:51.520,0:01:56.016
It took China less than five years[br]to become a country of mobile commerce,

0:01:56.040,0:02:01.176
and that is largely because[br]of the two technology platforms,

0:02:01.200,0:02:02.720
Alibaba and Tencent.

0:02:03.120,0:02:06.696
They own 90 percent of the e-commerce --

0:02:06.720,0:02:08.376
pretty much the whole market --

0:02:08.400,0:02:10.735
85 percent of social media,

0:02:10.759,0:02:13.896
85 percent of internet payment.

0:02:13.920,0:02:20.456
And they also own large volumes[br]of digital content, video, online movie,

0:02:20.480,0:02:23.640
literature, travel information, gaming.

0:02:25.200,0:02:28.456
When this huge base of mobile shoppers

0:02:28.480,0:02:30.936
meets with aggregated ecosystems,

0:02:30.960,0:02:32.816
chemical reactions happen.

0:02:32.840,0:02:35.456
Today, China is like a huge laboratory

0:02:35.480,0:02:38.296
generating all sorts of experiments.

0:02:38.320,0:02:39.776
You should come to China,

0:02:39.800,0:02:43.400
because here you will get[br]a glimpse into the future.

0:02:44.520,0:02:48.760
One of the trends I have seen[br]concerns the spontaneity of shopping.

0:02:49.440,0:02:51.496
Five years ago, in a fashion study,

0:02:51.520,0:02:52.976
we found that on average,

0:02:53.000,0:02:56.936
a Chinese consumer would be buying[br]five to eight pairs of shoes.

0:02:56.960,0:03:01.336
This number tripled[br]to reach about 25 pairs of shoes a year.

0:03:01.360,0:03:03.920
Who would need so many pairs of shoes?

0:03:04.520,0:03:07.656
So I asked them,[br]"What are the reasons you buy?"

0:03:07.680,0:03:10.336
They told me a list of inspirations:

0:03:10.360,0:03:15.016
blogs, celebrity news,[br]fashion information.

0:03:15.040,0:03:18.496
But really, for many of them,[br]there was no particular reason to buy.

0:03:18.520,0:03:21.016
They were just browsing[br]on their mobile site

0:03:21.040,0:03:23.160
and then buying whatever they saw.

0:03:24.560,0:03:28.816
We have observed the same level[br]of spontaneity in everything,

0:03:28.840,0:03:32.520
from grocery shopping[br]to buying insurance products.

0:03:34.240,0:03:37.816
But it is not very difficult[br]to understand if you think about it.

0:03:37.840,0:03:40.576
A lot of the Chinese consumers[br]are still very new

0:03:40.600,0:03:43.816
in their middle-class[br]or upper-middle-class lifestyles,

0:03:43.840,0:03:46.816
with a strong desire[br]to buy everything new,

0:03:46.840,0:03:48.896
new products, new services.

0:03:48.920,0:03:51.616
And with this integrated ecosystem,

0:03:51.640,0:03:56.120
it is so easy for them to buy,[br]one click after another.

0:03:57.520,0:04:02.016
However, this new shopping behavior[br]is creating a lot of challenges

0:04:02.040,0:04:04.776
for those once-dominant businesses.

0:04:04.800,0:04:08.656
The owner of a fashion company[br]told me that he's so frustrated

0:04:08.680,0:04:12.800
because his customers keep complaining[br]that his products are not new enough.

0:04:13.320,0:04:16.120
Well, for a fashion company,[br]really bad comment.

0:04:17.519,0:04:20.976
And he already increased the number[br]of products in each collection.

0:04:21.000,0:04:22.200
It doesn't seem to work.

0:04:22.800,0:04:26.216
So I told him there's something[br]more important than that.

0:04:26.240,0:04:29.696
You've got to give your consumer[br]exactly what they want

0:04:29.720,0:04:30.960
when they still want it.

0:04:31.720,0:04:36.256
And he can learn something[br]from the online apparel players in China.

0:04:36.280,0:04:39.536
These companies, they collect[br]real consumer feedback

0:04:39.560,0:04:42.056
from mobile sites, from social media,

0:04:42.080,0:04:45.376
and then their designers[br]will translate this information

0:04:45.400,0:04:47.096
into product ideas,

0:04:47.120,0:04:50.600
and then send them[br]to microstudios for production.

0:04:51.160,0:04:54.976
These microstudios are really key[br]in this overall ecosystem,

0:04:55.000,0:04:57.176
because they take small orders,

0:04:57.200,0:04:59.376
30 garments at a time,

0:04:59.400,0:05:02.600
and they can also make[br]partially customized pieces.

0:05:03.800,0:05:06.976
The fact that all these production designs

0:05:07.000,0:05:08.456
are done locally,

0:05:08.480,0:05:13.016
the whole process, from transporting[br]to product on shelf or online

0:05:13.040,0:05:15.616
sometimes takes only three to four days.

0:05:15.640,0:05:17.336
That is super fast,

0:05:17.360,0:05:20.976
and that is highly responsive[br]to what is in and hot on the market.

0:05:21.000,0:05:25.296
And that is giving enormous headaches[br]to traditional retailers

0:05:25.320,0:05:28.160
who are only thinking[br]about a few collections a year.

0:05:30.280,0:05:33.680
Then there's a consumer's need[br]for ultraconvenience.

0:05:34.240,0:05:37.456
A couple of months ago,[br]I was shopping with a friend in Tokyo.

0:05:37.480,0:05:38.736
We were in the store,

0:05:38.760,0:05:41.576
and there were three to four people[br]standing in front of us

0:05:41.600,0:05:43.056
at the checkout counter.

0:05:43.080,0:05:44.616
Pretty normal, right?

0:05:44.640,0:05:47.416
But both of us dropped our selection

0:05:47.440,0:05:48.640
and walked away.

0:05:49.440,0:05:51.680
This is how impatient we have become.

0:05:52.560,0:05:56.416
Delivering ultraconvenience[br]is not just something nice to have.

0:05:56.440,0:05:59.520
It is crucial to make sure[br]your consumer actually buys.

0:06:00.360,0:06:02.536
And in China, we have learned

0:06:02.560,0:06:06.696
that convenience is really the glue[br]that will make online shopping

0:06:06.720,0:06:09.696
a behavior and a habit that sticks.

0:06:09.720,0:06:13.296
It is sometimes more effective[br]than a loyalty program alone.

0:06:13.320,0:06:15.016
Take Hema.

0:06:15.040,0:06:19.080
It's a retail grocery concept[br]developed by Alibaba.

0:06:19.600,0:06:21.576
They deliver a full basket of products

0:06:21.600,0:06:24.856
from 4,000 SKUs to your doorstep

0:06:24.880,0:06:26.736
within 30 minutes.

0:06:26.760,0:06:30.856
What is amazing is that they deliver[br]literally everything:

0:06:30.880,0:06:33.096
fruits, vegetables, of course.

0:06:33.120,0:06:35.456
They also deliver live fish

0:06:35.480,0:06:37.800
and also live Alaska king crab.

0:06:38.960,0:06:41.216
Like my friend once told me,

0:06:41.240,0:06:42.936
"It's really my dream coming true.

0:06:42.960,0:06:45.896
Finally, I can impress my mother-in-law

0:06:45.920,0:06:48.896
when she comes to visit me[br]for dinner unexpectedly."

0:06:48.920,0:06:52.216
(Laughter)

0:06:52.240,0:06:54.896
Well, companies[br]like Amazon and FreshDirect

0:06:54.920,0:06:57.816
are also experimenting in the same field.

0:06:57.840,0:07:01.416
The fact that Hema[br]is part of the Alibaba ecosystem

0:07:01.440,0:07:04.960
makes it faster and also[br]a bit easier to implement.

0:07:05.760,0:07:07.656
For an online grocery player,

0:07:07.680,0:07:10.496
it is very difficult, very costly,

0:07:10.520,0:07:13.296
to deliver a full basket quickly,

0:07:13.320,0:07:15.936
but for Hema, it's got a mobile app,

0:07:15.960,0:07:17.616
it's got mobile payment,

0:07:17.640,0:07:23.336
and also it's built 20 physical stores[br]in high-density areas in Shanghai.

0:07:23.360,0:07:27.256
These stores are built[br]to ensure the freshness of the product --

0:07:27.280,0:07:30.176
they actually have[br]fish tanks in the store --

0:07:30.200,0:07:34.480
and also to give locations[br]that will enable high-speed delivery.

0:07:34.920,0:07:36.936
I know the question you have on your mind.

0:07:36.960,0:07:38.216
Are they making money?

0:07:38.240,0:07:39.576
Yes, they are making money.

0:07:39.600,0:07:40.856
They are breaking even,

0:07:40.880,0:07:44.456
and what is also amazing[br]is that the sales revenue per store

0:07:44.480,0:07:48.496
is three to four times higher[br]than the traditional grocery store,

0:07:48.520,0:07:52.160
and half of the revenue orders[br]are coming from mobile.

0:07:53.040,0:07:55.896
This is really proof that a consumer,

0:07:55.920,0:07:59.496
if you give them ultraconvenience[br]that really works in grocery shopping,

0:07:59.520,0:08:02.376
they're going to switch[br]their shopping behaviors online,

0:08:02.400,0:08:03.600
like, in no time.

0:08:05.480,0:08:08.576
So ultraconvenience and spontaneity,

0:08:08.600,0:08:10.456
that's not the full story.

0:08:10.480,0:08:12.616
The other trend I have seen in China

0:08:12.640,0:08:13.880
is social shopping.

0:08:14.440,0:08:17.056
If you think of social shopping[br]elsewhere in the world,

0:08:17.080,0:08:18.520
it is a linear process.

0:08:19.560,0:08:21.696
You pick up something on Facebook,

0:08:21.720,0:08:24.336
watch it, and you switch to Amazon

0:08:24.360,0:08:27.056
or brand.com to complete[br]the shopping journey.

0:08:27.080,0:08:28.736
Clean and simple.

0:08:28.760,0:08:31.856
But in China it is a very different thing.

0:08:31.880,0:08:36.616
On average, a consumer would spend[br]one hour on their mobile phone shopping.

0:08:36.640,0:08:39.296
That's three times higher[br]than the United States.

0:08:39.320,0:08:41.256
Where does the stickiness come from?

0:08:41.280,0:08:44.680
What are they actually doing[br]on this tiny little screen?

0:08:45.120,0:08:47.576
So let me take you[br]on a mobile shopping journey

0:08:47.600,0:08:49.520
that I usually would be experiencing.

0:08:51.000,0:08:53.960
11pm, yes, that's usually when I shop.

0:08:54.800,0:08:58.416
I was having a chat in a WeChat[br]chatroom with my friends.

0:08:58.440,0:09:00.536
One of them took out a pack of snack

0:09:00.560,0:09:03.840
and posted the product link[br]in that chatroom.

0:09:04.320,0:09:08.016
I hate it, because usually[br]I would just click that link

0:09:08.040,0:09:10.656
and then land on the product page.

0:09:10.680,0:09:12.936
Lots of information, very colorful,

0:09:12.960,0:09:14.376
mind-blowing.

0:09:14.400,0:09:17.136
Watched it and then[br]a shop assistant came online

0:09:17.160,0:09:20.216
and asked me, "How can I[br]help you tonight?"

0:09:20.240,0:09:22.416
Of course I bought that pack of snack.

0:09:22.440,0:09:26.496
What is more beautiful is I know[br]that the next day, around noontime,

0:09:26.520,0:09:29.376
that pack of snack[br]will be delivered to my office.

0:09:29.400,0:09:32.016
I can eat it and share it[br]with my colleagues

0:09:32.040,0:09:34.920
and the cost of delivery,[br]maximum one dollar.

0:09:36.240,0:09:39.176
Just when I was about to leave[br]that shopping site,

0:09:39.200,0:09:41.056
another screen popped up.

0:09:41.080,0:09:45.736
This time it is the livestreaming[br]of a grassroots celebrity

0:09:45.760,0:09:49.016
teaching me how to wear[br]a new color of lipstick.

0:09:49.040,0:09:52.136
I watched for 30 seconds --[br]very easy to understand --

0:09:52.160,0:09:55.216
and also there is[br]a shopping link right next to it,

0:09:55.240,0:09:57.880
clicked it, bought it in a few seconds.

0:09:58.600,0:10:00.096
Back to the chatroom.

0:10:00.120,0:10:01.976
The gossiping is still going on.

0:10:02.000,0:10:04.856
Another friend of mine posted the QR code

0:10:04.880,0:10:06.536
of another pack of snack.

0:10:06.560,0:10:08.080
Clicked it, bought it.

0:10:09.080,0:10:10.656
So the whole experience

0:10:10.680,0:10:14.456
is like you're exploring[br]in an amusement park.

0:10:14.480,0:10:17.096
It is chaotic, it is fun

0:10:17.120,0:10:19.520
and it's even a little bit addictive.

0:10:20.520,0:10:24.936
This is what's happening[br]when you have this integrated ecosystem.

0:10:24.960,0:10:27.656
Shopping is embedded in social,

0:10:27.680,0:10:32.376
and social is evolving[br]into a multidimensional experience.

0:10:32.400,0:10:36.096
The integration of ecosystems[br]reaches a whole new level.

0:10:36.120,0:10:39.440
So does its dominance[br]in all aspects of our life.

0:10:40.720,0:10:44.336
And of course, there are huge[br]commercial opportunities behind it.

0:10:44.360,0:10:47.176
A Chinese snack company, Three Squirrels,

0:10:47.200,0:10:50.976
built a half-a-billion-dollar business[br]in just three years

0:10:51.000,0:10:54.816
by investing in 300 to 500 shop assistants

0:10:54.840,0:10:58.976
who are going to be online[br]to provide services 24/7.

0:10:59.000,0:11:01.016
In the social media environment,

0:11:01.040,0:11:02.976
they are like your neighborhood friends.

0:11:03.000,0:11:04.696
Even when you are not buying stuff,

0:11:04.720,0:11:08.120
they will be happy to just tell you[br]a few jokes and make you happy.

0:11:09.000,0:11:11.096
In this integrated ecosystem,

0:11:11.120,0:11:15.576
social media can really redefine[br]the relationship between brand,

0:11:15.600,0:11:17.600
retailer and consumer.

0:11:19.440,0:11:22.896
These are only fragments[br]of the massive changes

0:11:22.920,0:11:24.616
I have seen in China.

0:11:24.640,0:11:26.616
In this huge laboratory,

0:11:26.640,0:11:30.320
a lot of experiments[br]are generated every single day.

0:11:31.040,0:11:33.536
The ecosystems are reforming,

0:11:33.560,0:11:37.736
supply chain distribution,[br]marketing, product innovation,

0:11:37.760,0:11:38.976
everything.

0:11:39.000,0:11:43.256
Consumers are getting the power[br]to decide what they want to buy,

0:11:43.280,0:11:44.576
when they want to buy it,

0:11:44.600,0:11:47.616
how they want to buy it,[br]how they want to social.

0:11:47.640,0:11:51.056
It is now back to business[br]leaders of the world

0:11:51.080,0:11:54.416
to really open their eyes,[br]see what's happening in China,

0:11:54.440,0:11:57.440
think about it and take actions.

0:11:58.320,0:11:59.536
Thank you.

0:11:59.560,0:12:02.360
(Applause)

0:12:07.760,0:12:10.240
Massimo Portincaso: Angela, [br]what you shared with us

0:12:10.260,0:12:12.380
is truly impressive and almost incredible,

0:12:12.400,0:12:17.656
but I think many in the audience[br]had the same question that I had,

0:12:17.680,0:12:18.896
which is:

0:12:18.920,0:12:22.256
Is this kind of impulsive consumption

0:12:22.280,0:12:26.496
both economically and environmentally[br]sustainable over the longer term?

0:12:26.520,0:12:30.256
And what is the total price to be paid

0:12:30.280,0:12:34.976
for such an automized[br]and ultraconvenient retail experience?

0:12:35.000,0:12:37.896
Angela Wang: Yeah.[br]One thing we have to keep in mind

0:12:37.920,0:12:41.640
is really, we are at the very beginning[br]of a huge transformation.

0:12:42.200,0:12:45.336
So with this trading up[br]needs of the consumer,

0:12:45.360,0:12:48.496
together with the evolution[br]of the ecosystem,

0:12:48.520,0:12:52.296
there are a lot of opportunities[br]and also challenges.

0:12:52.320,0:12:53.896
So I've seen some early signs

0:12:53.920,0:12:56.776
that the ecosystems[br]are shifting their focus

0:12:56.800,0:12:59.376
to pay attention[br]to solve these challenges.

0:12:59.400,0:13:03.656
For example, paying more[br]consideration to sustainability

0:13:03.680,0:13:05.616
alongside just about speed,

0:13:05.640,0:13:08.496
and also quality over quantity.

0:13:08.520,0:13:11.456
But there are really[br]no simple answers to these questions.

0:13:11.480,0:13:14.096
That is exactly why[br]I'm here to tell everyone

0:13:14.120,0:13:19.000
that we need to watch it, study it,[br]and play a part in this evolution.

0:13:19.680,0:13:21.216
MP: Thank you very much.

0:13:21.240,0:13:22.456
AW: Thank you.

0:13:22.480,0:13:25.120
(Applause)