According to conventional wisdom, the oft-told parable of three little pigs and a big, bad wolf is about the difference between working hard and cutting corners. The two lazy pigs in the tale needed to learn from their conscientious sibling and build their houses with bricks instead of wood and straw. In fact, the real lesson is a simple one about procurement: they should have sourced the right kind of building material from someone who knew what it would take to get the job done properly. If only they could, in a glance, tell trustworthy suppliers from unreliable vendors.
That is why they should have visited the 2016 Malaysian International Furniture Fair (MIFF) held in Kuala Lumpur. It was a pilot event where Alibaba.com collaborated with the exhibition organizer to debut its unique approach for visualizing the credibility of participating vendors, and to roll out its Trade Assurance protection program for suppliers outside of China with the purpose of boosting trust between buyers and sellers on cross-border trading. Visitors to the event were provided with interactive "smart glasses" for the next generation sourcing experience that bridged the online and the offline worlds with cutting edge technology in augmented reality. The glasses were hi-tech gadgets that enabled visitors to visually identify exhibitors who were also Alibaba.com Trade Assurance suppliers, and to literally read information on the background and the credibility of these vendors as visitors tour the booths in the exhibition venue.
The information available to MIFF visitors is also posted online at Alibaba.com and accessible to those who visit the website. Prospective buyers who browse the homepage can look for information on the coverage amounts enjoyed by suppliers under the Trade Assurance scheme, the total number of transactions as well as accumulated transaction amounts achieved by suppliers on Alibaba.com, the number of online visits and inquiries as well as their response rates. Besides, prospective buyers can browse the profiles of Trade Assurance vendors, including third-party verification of their legal status and reports of on-site checks. Information of these kinds make up the pool of business intelligence that can play a vital role in helping buyers open doors to reliable suppliers as well as make informed decisions.
However, the MIFF pilot was only Alibaba's first foray into the world of augmented reality, the technology behind the popular Pokemon Go app. Earlier this year, the group launched its own in-house virtual reality research laboratory called the GnomeMagic Laband invested in the mixed reality technology company Magic Leap, which is a rising star pursuing what is billed by some of the biggest names in Silicon Valley as the next big thing in computing. It has also tinkered with 360 degree panoramic video for the Chinese video sharing site Youku Tudou. The aim behind all these efforts is to integrate state-of-the-art technology in augmented reality into the purchasing experience of visitors to the group's online marketplaces.
Some day in the not-too-distant future, a buyer visiting Alibaba.com can have "mixed reality" video chats with prospective suppliers located all over the world. The suppliers will look as if they are sitting across the desk from the buyer while, on their end, the buyer will appear to be present in their respective showrooms. The buyer will also be able to examine products -- such as clothing and fashion accessories on a model -- with a 360-degree view as well as in much greater detail than is possible on his mobile phone or his computer. The images projected by augmented reality will blend in so seamlessly with his perception of the world around him that when he "picks up" one of the items on virtual display, he can literally "feel" the touch of the object with his fingers. In this future scenario, Alibaba.com will bring the security and the convenience of sourcing to the comfort of our homes and our offices.
Alibaba's decision to dive into virtual, augmented and mixed reality drew on the group's "big data" technology that it has been developing for many years. The e-commerce behemoth operates a dozen Internet-based businesses, and the online activities of these affiliates generate huge data sets that exceed the processing capacity of traditional database systems due to volume, speed and variability. These in-house data troves are merged with third-party data resources and then analyzed with the group's cloud computing capability to spot patterns, trends and associations for understanding customer characteristics and behavior as well as to help build Alibaba's unique credit scoring model. Alibaba.com put this technology to use when it launched the Trade Assurance program in 2014, and assigns suppliers the amounts covered by the scheme in accordance with theircredit ratings achieved under the big data model.
Going into the future, Alibaba.com can leverage big data to help vendors sniff out buying trends and project a more detailed picture of the competitive landscape. Who are their prospective customers and where do they come from? What keywords will attract their eyeballs? What types of products are they most interested in? How often do they make purchases? Why are some of them not making purchases? Alibaba.com can help vendors answer these questions, and thereby provide them with the tools to boost their sales by being better able to anticipate and adapt to shifting consumer desires, and to target individual customers based on their personal shopping history. If only someone could have recommended this B2C online marketplace to the three little pigs in the much-loved parable!