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China’s Off-Line Convenience Payment Market to Enter Consolidation Period; alaDing Standing Out

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011-05-30 15:03
SHANGHAI, May 30, 2011 /PRNewswire-Asia/ — With the release of the Administrative Measures for Payment Services of Non-Financial Institutions, China’s off-line convenience payment market will enter the consolidation period in the first and second quarters of 2011, according to statistics from Analysys International. Transactions of off-line convenience payment reached RMB79 billion (approx. US$12 billion) in the fourth quarter of 2010, representing a sequential growth of 12.66 per cent. The market will grow significantly over the next 6-12 months. There is still huge potential for market growth and innovation for off-line convenience payment. With increasing companies entering the convenience payment sector, the dominant off-line convenience payment provider will witness intensified competition. The market will maintain the focus on traditional convenience store channel, complemented by other market segmentation channels.

New business opening and outlet expansion are the main contributors to the fast growth of traditional off-line convenience payment transactions. While Lakala retreats from FamilyMart and focuses on the off-line payment services for home users, other market players have sped up their expansion in convenience stores. Avantouch Software, a Singapore-invested foreign company in China, differentiated itself from its competitors in terms of market share in convenience stores in the first quarter of 2011. alaDing, a self-service convenience payment terminal, has been available in FamilyMart, Lawson and Buddies convenience stores in the vicinity of Shanghai’s major business districts crowded with white collars and office buildings such as People’s Square, West Nanjing Road, Xujiahui and Lujiazui.

Avantouch Software CEO Lee Kia Hwee showed how to use alaDing in a FamilyMart.
In a FamilyMart convenience store at West Nanjing Road, some white-collars working nearby are touching the screen of the alaDing machine and operate and use it proficiently. This machine, with a simple and even in some sort young and fashionable outlook, appears as a more creative media platform to people who use it for the first time. After observation, however, consumers will understand that the Singaporean company’s attempt for Chinese market is not simple, as this is an e-commerce sale and off-line payment service platform integrated with a variety of products.

Avantouch Software, backed by Singapore’s leading listed company IPS, inked a contract with well-known FamilyMart to boldly expand its convenience store channels. FamilyMart has about 600 stores across China, of which 490 are located in Shanghai. Foreign-funded convenience store Lawson also signed a deal on alaDing. The two convenience store brands with operations covering 69 per cent of top-rated office buildings and business zones are gathering a number of high- and middle-grade white-collars, which is one of the reasons why the two brands were chosen first at the time when Avantouch Software CEO Lee Kia Hwee decided to develop convenience store channels. The number of alaDing terminals in Shanghai now has totaled nearly 500, and is expected to reach about 1,000 by year end. Moreover, alaDing will enter Shenzhen and Guangzhou in the second half of this year.

Convenience stores with a good reputation are really one of the best channels for the development of offline payment business. alaDing emerged unexpectedly, mainly due to its unique model, a combination of a self-service terminal, prompt logistic delivery, a safe payment platform and convenience products and services, making a diversified sales service platform and bringing an e-shelf into convenience stores without increasing retail space, while significantly improving convenience stores’ SKU and ROI. Combining practical stores and virtual marketing makes services safely and quickly. Tickets for performances, cinemas and lotteries, game point cards, top-ups and payments, coupon printing, loyalty point redemption, group buying and other services for every aspect of daily life can be purchased through alaDing. alaDing is very distinctive and differential over those provided by other convenience payment and coupon operators.

An official at Shanghai Telecom said that alaDing’s instant loyalty point redemption service for Shanghai Telecom’s users is a major innovation in loyalty point redemption operations. Before the innovative service available, many users complained that they missed to redeem their large amounts of loyalty points by the due date. They also find it time-consuming and unsatisfactory to redeem the points at the online redemption center, because they have to check the exact amount of their loyalty points for item equivalents. Now with alaDing’s instant redemption service, after entering their mobile phone number at an alaDing terminal and then getting an access code, users are allowed to use their telecom loyalty points to buy goods in equivalent value at any FamilyMart store where alaDing terminals are available in Shanghai, avoiding a miss to redeem by due date and complicated online processes. Shanghai Telecom also provides their users with innovative experience in exchanging loyalty points and enhances their confidence in the brand. These benefits help alaDing consolidate its targeted white-collar consumer base and increase the consumer stickiness in middle- and old-aged consumers who have easy access to alaDing terminals at convenience stores located in their residential communities.

To maximize its consumer stickiness, alaDing learns from a number of foreign successful stories when developing its own products and services. In the competitive movie ticket discount market, alaDing not only provides bookings of special-priced tickets for any session at nearly 40 theaters in Shanghai, but also film information display, real-time session booking and online seat selection services.

The white-collars using alaDing for consumption in convenience stores generally believe that with consumer need for more diversified off-line payment and more completed convenience store services, the off-line payment providers still have a lot to do, such as adding more payment methods, offering diversified and convenient products, protecting personal information and maintaining old and new customer relations.

With issuance of the third party payment licenses by Chinese government, customers’ acceptance of merchants will be improved and channels in the second and third tier cities will be expanded, which will accordingly bring the acceleration of market growth.

For more information, please contact:

Mark Ng
Tel: +86-21-6441-8698
Website: ,

SOURCE Avantouch Software

Written by asiafreshnews

May 31, 2011 at 6:44 pm

Posted in Uncategorized

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