Chinese real estate giant Dalian Wanda Group has pulled in 1 billion yuan ($161 million) for what it hopes will be the biggest omnichannel retail operation in the world, according to Forbes.
The new money, for the e-commerce joint venture Dalian Wanda set up in August with Baidu and Tencent, comes from two investment funds: Suzhou-based Centec Networks, which will own 3 percent of Wanda E-commerce, and Hong Kong’s Xu De Ren Dao E-Commerce Investment, which will own 2 percent. The deals value the e-commerce platform at 20 billion yuan ($3.22 billion).
Wanda’s e-commerce plan is to use the online chat and search services of Baidu and Tencent to drive traffic to Wanda’s nationwide chain of more than 100 brick-and-mortar shopping malls across China. Between them, Baidu and Tencent have hundreds of millions of users.
Wanda has also acquired its own payment platform so it can get a piece of the revenue from each sale of goods or services too. In December Dalian Wanda acquired control of 99bill, the fourth-largest third-party payment service provider in China. That investment is reportedly valued at more than 2 billion yuan ($322 million).
The online-to-offline moves are seen as a challenge to Alibaba, the largest Chinese online retailer. While the majority of China’s e-commerce flows through Alibaba, it’s an eBay-like arrangement in which Alibaba’s share of each transaction is relatively small and there’s no significant offline component. That means Dalian Wanda’s shopping-mall-based approach is one that Alibaba can’t directly counter.