KFC Offers Alipay Mobile Payments to Chinese Customers

KFC China’s customers in Shanghai and Hangzhou can now pay for their in-store purchases on their mobile phones using Alibaba’s Alipay payment system. The option will be extended to the fast food giant’s 5,000 China-wide stores by July.

Payment for KFC orders can be made by scanning the Alipay QR or barcode embedded in the customer’s smart phone at the cash register, with transaction times expected to take two seconds or less. Chinese customers will also be able to access special deals and promotions via a KFC China smart phone app.

“The cooperation with KFC China signifies the milestone on how Alipay will revamp offline payments across the country, and we are working closely with KFC China to provide better deals and services for customers,” says Fan Zhiming, president of Alibaba’s Ant Financial payment business unit.

Alipay has become the preferred payment method in China due to its simplicity, the trust it creates among consumers, and its reach, says Ohad Hecht, chief operating officer, Emarsys.

“The reason for their success is pinned to their flexible payment methods – credit card, payment on delivery, payment in convenient kiosks/shops and the famous escrow service – that increases the trust between the seller and the buyer,” says Hecht. “Every retailer is looking at simplifying the purchase process and payment is one of these elements.”  

In May, Walmart began offering Alipay payment options to consumers of its 25 stores in Shenzhen. As part of the launch, Walmart offered promotions and discounts to members of its Futian Sam’s Club for their first transaction paid through Alipay.

James Stewart, partner and retail practice leader at advisory firm Ferrier Hodgson says these payment options are great for Chinese consumers.

“The global trend towards mobile payments is where the world is heading. The Alipay deal is at the point end of the wedge for Walmart but makes a lot of sense both in China and I expect other Asian markets in due course, where virtually all Internet users are in fact mobile Internet users and the convenience factor is high,” says Stewart.

The real benefit for brands like Walmart, however, is data, he says.

“Walmart is already a sophisticated user of analytics and the deal with Alipay will only enhance their ability to tailor their product range to local Chinese consumers and engage with their customers at a more intimate level.”

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