To use immersive virtual reality in the world of e-commerce was the next step for Future Technology after VR MMORPG.
Imagine being able to shop without leaving home or going on a shopping spree without moving from the computer… oh no, the person in front of the helmet would no longer have to worry if the clothes bought online would fit because you could “take” the clothes out from the shopping cart and directly “put it on” your body to try them yourself!
With the introduction of VR shopping, it meant that the only advantage of physical stores would cease to exist. Physical storefronts compared to e-commerce stores without an actual location lacked the advantage of saving on rent costs. Now that the VR shopping experience was brought to the same level, it could be foreseen that once it was adopted by the mass market, it would bring disruptive changes to retail and even real estate markets.
Technology with such a bright future was obviously not going to be ignored by the e-commerce giants.
For example, VR shopping, or the concept known as “buy+,” was initiated by Ali at the beginning of 2016 but because of the restrictive nature of technology, Ali’s VR shopping experience had a lackluster effect, far less than promoted.
It was impractical to design an interactive VR experience for every store due to the work required, and it also greatly increased the number of stores that could register at a VR mall.
Also, VR glasses could only bring a limited experience to customers. With just images alone, it offered no difference compared to shopping through a screen. But if they used high tech 3D movement capture technology to replicate the physical dimensions of the products, it would increase the cost. Would customers really purchase VR glasses with a price tag of over 1000 USD just to shop? Perhaps yes, but rich people only accounted for a small portion of sales.
Therefore, buy+ required a medium that had a high market penetration rate that could also maximize the shopping experience.
The Phantom medium happened to satisfy both conditions.
The high sales set the foundation for a massive user base. Immersive virtual reality technology would provide a comprehensive experience to users. Because of this, Ali chose to contact Jiang Chen immediately after the business forum, hoping to partner up in the “VR + e-commerce” strategy.
But Jiang Chen didn’t immediately reply to Ma Yun who called him personally because he still had to discuss this with Xia Shiyu. He wondered if they should partner up or take care of the retail aspect in-house.
Could Future Technology ditch Ali and do e-commerce themselves? After discussion, Jiang Chen and Xia Shiyu both reached a consensus that while it was theoretically possible, there was no practical reason to do so. Future Technology had no experience in the e-commerce market, and it would be a lost cause if they spent a large amount of time and energy to start in the e-commerce division.
Just like building an aircraft carrier, it wasn’t necessary to build every single screw themselves.
With an absolute advantage in technology, Future Technology only needed to focus on developing the channel while the content could be created by Ali, JD, Amazon, and eBay, who all had a wealth of experience and resources.
As for how the partnership would take place, that was the purpose of Jiang Chen’s visit to Wanghai.
The next morning, Liu Haotian arrived at the mansion as promised.
When he saw Jiang Chen walking out of the mansion glowing, he guessed what happened last night. He only smirked without saying anything and opened the door for Jiang Chen. After Jiang Chen set the destination on the GPS, Liu Haotian took Jiang Chen on his way.
There were a lot of enterprises that invited Jiang Chen to discuss a “VR + e-commerce” relationship – both domestic and international players.
Based on the negotiation strategy discussed with Xia Shiyu, Jiang Chen didn’t look for Ali first but rather, he sought out Ali’s international competitor, Amazon.
Amazon first asked Future Technology to make development tools and licensing available for virtual reality, and the e-commerce application would be designed by them.
It wasn’t the right time to make development tools available. Based on their proposal, it was equivalent to Amazon getting rid of them. If “VR + e-commerce” became extremely successful, it would have nothing to do with Future Technology.
The two parties couldn’t compromise at all on the fundamental problem and negotiations couldn’t continue, so Jiang Chen stopped trying to negotiate with them and directly went to speak with eBay.
When Amazon realized Future Group wasn’t going to negotiate with them further, they instantly became anxious.
Since Future Technology was the only company that mastered immersive virtual reality technology, if Amazon allowed their competitor to create a virtual reality platform first, it would be a detrimental blow to Amazon’s business. Amazon realized this immediately and changed their strong stance. They signaled their willingness to make concessions on software while requesting another negotiation session.
Therefore, the two-party meeting became a three-party meeting.
At the same time, Ali, who was excluded, could no longer sit around. They previous thought Jiang Chen would go seek them out, but Future Technology was almost close to reaching an agreement with Amazon and eBay!
Ali couldn’t fall at the hands of their competitors now. Based on the popularity of the Phantom in the international market, it was a great opportunity for Ali to expand its international market through a VR platform!
Boss Ma, who just flew from Shangjin to Wanghai, immediately sat down with Jiang Chen and invited him for a meal at his own place.
Han people had the tradition of discussing business over the dinner table. Since Boss Ma personally invited Jiang Chen for a drink, it gave him all the respect he was due.
Jiang Chen had been waiting for exactly this.
Of course, he wasn’t just waiting for Ma Yun to propose a few toasts over the dinner table nor was he planning to exclude Ali from negotiations entirely. The reason why he didn’t actively seek negotiations with Ali first was just to force Ali to stop sitting around.
Future Technology was close to a deal with eBay and Amazon. As the fourth party with aspirations of being included, Ali had to bring some sincerity to the negotiation table.
Ali didn’t disappoint Jiang Chen. Compared to the foreign companies with stricter terms, they not only made concessions in cooperation, but they even proposed a plan clearly more favorable to Future Technology.
When Amazon and eBay saw this, they knew they had been tricked. Considering how interested Jiang Chen looked, Ali’s representative was relieved.
The exact plan was the following:
Future Technology would design a platform-based software, with Ali to provide the content. Users would purchase items from Future Technology’s virtual reality market with Ali deciding which goods could enter the market. Confirmation of the purchase would be done through the internal browser in the helmet which would jump to Taobao’s page, or Taobao could design a more simple purchase and pay page for the virtual reality market.
It was like Future Technology was the market, while Ali and other e-commerce giants were suppliers and store leasers. The former dictated the location while the latter provided the supplies. The retailers registered under each e-commerce platform were like products on the shelf.
To put it simply, Future Technology only provided the platform, so e-commerce was still e-commerce.
With this plan, Jiang Chen threw his previously prepared plan away. The professionals indeed knew what they were doing, so he didn’t have any reason to reject their plan at all.
While Amazon and eBay were displeased, they couldn’t bring out a better proposal. They could only accept this proposal.
Later, Jiang Chen invited other e-commerce platforms interested in VR into the negotiation. Each party would be given a market share, divide the VR distribution channel, and enhance the partnership agreement.
In a week, eight “VR + e-commerce” agreements were signed. Strictly speaking, it was the first deal Jiang Chen signed as a President for the company.
And it was a mega deal worth ten billion!
