Starbucks has officially struck a partnership with Alibaba Group with a multipronged plan to boost the beverage company's digital and physical presence in China, Starbucks President and CEO Kevin Johnson told CNBC on Wednesday.
In the exclusive agreement, the global fast-casual chain will leverage all of Alibaba's properties, including delivery platform Ele.me and supermarket chain Hema, to expand delivery services throughout China.
"This means that a customer that uses Alipay or Taobao or Tmall or Hema has an integrated Starbucks virtual store similar to the mobile app embedded right into that experience," the CEO said. "That opens up 500 million or more active users of those apps that will have access to Starbucks."
Starbucks will also partner with Ele.me, a food delivery platform that Alibaba acquired this year. The partnership will help Starbucks make deliveries from 150 stores in Shanghai and Beijing and then broaden delivery to 2,000 stores in 30 cities "before the end of the calendar year," Johnson said.