---
title: "Ma Yun's \"New Retail Research Report\": Are You Putting on a Crosstalk Show for the Whole Nation?"
description: "This article critiques Alibaba's New Retail Research Report, arguing that it fails to address the real problems of traditional retail, such as high costs and lack of retailer responsibility. It suggests that true retail innovation should focus on providing quality products at low prices and binding consumers through emotional or membership models."
author: "苗庆显"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2017-03-15"
language: "en"
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original_source: "https://mp.weixin.qq.com/s/EmhahuwlnsUxd7B_Ql1h6g"
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# Ma Yun's "New Retail Research Report": Are You Putting on a Crosstalk Show for the Whole Nation?

> This article critiques Alibaba's New Retail Research Report, arguing that it fails to address the real problems of traditional retail, such as high costs and lack of retailer responsibility. It suggests that true retail innovation should focus on providing quality products at low prices and binding consumers through emotional or membership models.

**Click the image for details**
Introduction
What are the highlights and pitfalls of Alibaba's New Retail Research Report?
If there is "new retail," what is "old retail," and what are its drawbacks that must be changed?
Where is the breakthrough direction for retail transformation?
In traditional crosstalk, there is a classic sketch called "Borrowing the Horse Coat" (Pa Ma Gua), performed by old masters like Hou Baolin, Ma Sanli, Liu Baorui, Guo Rongqi, Ma Ji, and in recent years, Deyun Society often performs it.
The general pattern is: one person brags, another listens and raises questions, and a third is responsible for covering up the lies.
For example, C says, "Our mule fell into a teacup and was scalded to death." B says, "That's not right. A mule is so big, and a teacup is so small. How could that happen?" A, because he is wearing C's horse coat, has to cover up: "We traded the mule for a very good cricket, and accidentally the cricket fell into the teacup and was scalded to death. Isn't that equivalent to scalding the mule to death?" That's how they cover it up, which in jargon is called "mud-sewing."
Since last year, when Ma Yun threw out the "new retail" gimmick, he has been putting on a grand crosstalk show with the whole nation, and it's not over yet.
When Ma Yun mentions new retail, many follow suit to ride the trend and "mud-sew," but few hit the point. Zong Qinghou first played the straight man: "Except for new technology, everything else is nonsense." Liu Qiangdong joined in, saying, "What you call 'new retail' is me!" The onlookers enjoyed it. Later, Alibaba's cooperation with Bailian was still questioned: What reaction can two platform companies that collect rent by sitting on the ground have together?
So, Alibaba Research Institute, wearing Ma Yun's "horse coat," stepped in: A few days ago, they released the "New Retail Research Report" in Shanghai, interpreting the concept and methodology of "new retail." After all, they are family, and they really put in effort, making it the biggest "mud-sewing" in the past six months. The content is available online; interested readers can search for it themselves.
Alibaba Research Institute defines "new retail" as follows:
> "A data-driven pan-retail form centered on consumer experience," supplemented by concepts like "heart-centered," "new retail species," "reconstructing people, goods, and scenes," and "artificial intelligence," and further explains that the essence of retail is "to always provide consumers with 'content' that exceeds expectations at all times."
Does it get more confusing the more you listen? The basic requirement of explanation is to make something difficult understandable with easy terms. What do you mean by using a bunch of difficult words to explain a concept that doesn't seem that difficult? We'll discuss the pitfalls in detail below.
And the "methodology" is like this, mainly proposing a knowledge framework for new retail:
> **Front stage:** Scenes, consumers, products
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> **Middle stage:** Marketing, market, distribution chain, C2B production model
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> **Back stage:** Infrastructure, cloud-network-terminal domain OS, technology (3D/4D printing, AR/VR, digitalization, AI, IoT...)
Is this called a methodology? I haven't read much, but don't fool me! A methodology provides problem-solving approaches, even if it gives operating rules, or at least specific methods and tools. But listing an idealized future operating system structure is what?
Apart from some obscure concepts, there are old terms like consumer experience, scenes, C2B, and content. What really seems somewhat bright is the application of new technology in "new retail."
Alibaba Research Institute messed up this time; they indirectly proved Zong Qinghou's statement that "except for new technology, everything else is nonsense." Was Alibaba Research Institute infiltrated by Wahaha?
**Without a correct judgment of the macro environment and trends, any revolutionary concept is just "playing with you."** Although Alibaba's report uses grand titles like "The Evolution History of Human Retail," it does not reveal the substantive drawbacks of the current retail industry. Of course, they know very well; just think about how e-commerce succeeded domestically.
The biggest external problem of traditional retail is the extremely high operating costs caused by high housing prices, which Alibaba Research Institute calls the "real estate model." The low-price weapon that e-commerce relies on for success is built on bypassing real estate and facing consumers directly through express delivery.
However, e-commerce does not rely on real estate but depends on express delivery. As the express delivery industry grows, the bargaining power of the four major express companies plus SF Express increases, and as courier wages rise, e-commerce's cost advantage will gradually be eroded. If you study retail, recently you should not only pay attention to the Alibaba-Bailian marriage and the government work report encouraging the integration of e-commerce and physical retail, but also pay attention to SF Express's listing.
Professor Zeng Xiangwen once said: "Real estate developers can force physical stores to death, and Wang Wei can force Ma Yun to death."
The biggest problem within traditional retail, including e-commerce, is: **The retail subject is unclear.** Lao Miao wrote in an article on February 20:
> For a long time, Chinese retailers have preferred to abandon self-operation and switch to joint operation or even just collect platform fees, minimizing transaction risks: **That is, whether you sell or not is none of my business; I just sit and collect rent; and even charge other fees, euphemistically called service fees.**
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> In terms of retail functions, they simplify to only undertake logistics and transaction functions, leaving everything else to suppliers.
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> E-commerce has inherited this "glorious tradition" of traditional retailers and carried it forward, not only collecting platform fees but also charging more service fees in the name of helping suppliers.
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> From this perspective, at least from Alibaba's current performance, it is not only not "new" but "old as teeth." Since the development of e-commerce, its progress has been technological, making it possible for customers to shop from offline to PC to mobile, but there has been no progress in retail philosophy, or even regression.
Let's look at the essence of a production enterprise operating a Tmall store: **The production enterprise takes on the roles of manufacturer, brand owner, logistics provider, middleman, and retailer, while Tmall is essentially an online real estate developer plus advertising company.** JD.com is better off, undertaking logistics, but most functions are still done by the manufacturer.
This is a common "anti-specialization" phenomenon: professional retailers are absent, and traditional department stores, supermarkets, and online e-commerce giants are all becoming platforms, forcing suppliers to bear retailer functions, leading to intensified conflicts between supply and retail, severe internal friction, low efficiency, and further increasing the cost of products reaching consumers.
Under these two major internal and external problems, consumers can only buy **low-quality, high-priced** products or even **counterfeit goods**. When going abroad, they look at everything with shining eyes—milk powder, cosmetics, bags, toilet seats—and grab whatever they see.
Therefore, the urgent problem that the retail industry needs to solve is **not to let consumers "always" feel that the services provided "exceed expectations," nor to experience various humanized new technologies at the terminal, but to be able to buy high-quality, low-priced products, at least genuine products at fair prices.**
On March 9, the "New Retail Research Report" in Shanghai was depicting consumers' wonderful future experiences, while Ma Yun, attending the Two Sessions in Beijing, was being attacked by many representatives for "selling counterfeit goods." It's truly a mix of absurdity and sadness. (It's not appropriate to blame e-commerce for the proliferation of counterfeit goods; its foundation is different.)
If there is indeed a concept of "new retail," it must be a fundamental reform targeting "old retail": first, solving the problem of absent retail subjects; second, solving the problems of high retail costs and low efficiency.
Once these two problems are solved, there will emerge a new retail format that **can buy and sell, understands marketing and operations, and knows how to communicate with consumers**, delivering a devastating blow to existing platform-based retailers that only collect rent.
Since platforms are currently monopolistic and expensive, this retail format can only emerge **by pushing back from the consumer level**, and it may appear in the following four situations:
1
IKEA-style retailers
To those who don't appreciate IKEA, the store is simply a freak: furniture is expensive and ugly, and worse, it's all semi-finished, requiring assembly at home, which is extremely laborious. But this IKEA, which aims to trouble consumers, is the most successful furniture brand globally, and countless people have deep love for it.
Behavioral economist Dan Ariely even coined a psychological term for it: "**IKEA effect**," which refers to people developing more affection for things they have put labor into, leading to more attachment and higher valuation.
This type of retailer **binds consumers through emotion.**
2
Low-price, high-quality membership stores
This kind of membership store is not the kind where you can get member prices by just filling in some information, but one where you actually pay a high annual fee, and you can really buy low-price, high-quality products. The typical representative is Costco in the United States.
This chain membership store, highly praised by Lei Jun, reportedly has a gross margin of only about 10%, half of Walmart's, which claims to be low-priced every day. We're talking about Walmart in the U.S. For domestic international stores, with front and back costs plus various fees, if the gross margin is less than 40%, they wouldn't dare call themselves a supermarket.
Costco's profits mainly come from membership fees, truly binding consumers with stunning low prices and high quality. Consumers get both psychological and shopping satisfaction, so loyalty is naturally high.
I once discussed with industry experts whether Costco's format could become the mainstream of China's future retail. Lao Miao's tentative conclusion is that currently, operating with a 10% or slightly higher gross margin domestically has little chance, and charging consumers high annual fees still requires education. But this basic method of **attracting consumers with low-price, high-quality products and binding them with payment fees** is definitely feasible.
3
Marketing-oriented vertical e-commerce
Vertical e-commerce has already gone through a round of reshuffling, and now is the right time to enter. The previous round was mainly platform-based, with some marketing-oriented ones, cutting in by industry or product category, like Vanke.
But the new marketing-oriented vertical e-commerce will be very different. It cuts in **based on people**, and it's the same principle: **Bind consumers and work the channel backwards. You can start from communities and fans to form core seed users.** Luoji Thinking selling books and Xiaomi selling phones are already the meaning of marketing-oriented vertical e-commerce. If Mi Meng were willing to sell things, it would surely be more promising than selling ads.
4
Upgraded WeChat business (Weishang)
The WeChat business in 2015 made Lao Miao's eyes light up.
We often talk about "market forces" and "the invisible hand," which feels mysterious. In fact, **the root of market forces comes from human emotions; emotions are basic energy.** Expectations, disappointments, and satisfactions with products and brands are transformed through emotional power into behaviors like purchasing, sharing, evaluating, and complaining. WeChat is undoubtedly the most effective tool currently demonstrating this power, and it even has the potential to sweep through various platforms.
Unfortunately, WeChat business quickly became pyramid-scheme-like. The market forces first demonstrated on WeChat were dreams of wealth, speculation, and greed. Most WeChat businesses became disgusting rat schemes, flooding friend circles with chicken soup and ads.
But as the previous wave of pyramid-scheme WeChat businesses is cleaned out, those products that truly bring surprises to consumers and those that give customers the urge to share will soon stand out.
Currently, some WeChat businesses for maternal and child products and community fresh food are developing rapidly. Products and services worth sharing still have great prospects in WeChat business.
**What revolutionary new retail? There is only change, growth, and development trends in the current environment.** The power of platforms has been exhausted, but the power of people has not yet been truly unleashed. To say a correct cliché: Those who win consumers win the world.
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