Alibaba rolls out 3-hour delivery service for health care goods

Nov. 11, 2014: The logo of the Alibaba Group is seen inside the company's headquarters in Hangzhou, Zhejiang province. (REUTERS)

BEIJING – Chinese online shopping giant Alibaba Group Holding Ltd is rolling out a three-hour delivery service for healthcare goods, mimicking rival JD.com Inc.

The service will launch in five Chinese cities, including Beijing and Shanghai, and expand to 19 by the end of 2015, Alibaba said on Tuesday.

Products beyond healthcare will be added in the future.

It works through a partnership with five pharmacy chains that sell goods via stores on Alibaba's Tmall.com website.

The service, called 'Ji Su Da' or "fast delivery", links shoppers who buy eligible products to the nearest of more than 1,500 drugstores.

Cainiao, an Alibaba affiliate operated in partnership with various logistics firms, collects and delivers the order.

Alibaba's biggest e-commerce challenger is JD.com, which is built on a devotion to strong logistics networks and speedy delivery similar to Amazon.com Inc.

Wary of that prowess when it comes to distribution, Alibaba and its partners have spent recent years building out Cainiao in an effort to compete.

Ji Su Da is part of a broader trend to bring online various offline services from flagging a taxi to finding nearby restaurant deals. Known as "online to offline", this often uses a smartphone to find someone's location and the nearest service provider.

"This service is ideal for consumers who need non-prescription drugs and other healthcare products quickly," said Xu Hui, head of Cainiao Ji Su Da. "This service effectively mobilizes resources at both online and offline stores, which in turn brings the customers a seamless shopping experience."

Alibaba has been ramping up its healthcare operations. Last month, it injected its online pharmacy operations into affiliate Alibaba Health Information Technology Limited, a $2.5 billion deal to consolidate its healthcare enterprise and ride a boom in online health-related business.

But Ji Su Da could see growth restricted by its limited application, mainly working for everyday goods which are available on a large scale throughout China, as well as JD.com's rival service. The smaller e-commerce company operates JD Daojia, which does rapid delivery for groceries, meals and flowers.

"We've offered standard same-day delivery in most major cities for years -- more than 130 areas today -- not just for a few items, but for the tens of thousands of products that we stock," a JD.com spokesman told Reuters in an email.