Alipay rolls out 'Word of Mouth' software

A customer uses Koubei's app to order dishes at a restaurant in Hangzhou, Zhejiang province, Aug 22, 2016. [Photo/VCG]

Koubei, a restaurant review and local services platform under Alipay, rolled out its standalone mobile app on Wednesday, as it elbowed its way into China's red hot online-to-offline commerce industry, which is now worth hundreds of billions of dollars.

The launch came as parent Alibaba Group Holding Ltd upped its ante on neighborhood services to promote its mobile payment business and use Koubei as a test ground to implement its data-backed, "new retail" strategy, analysts said.

The new app gives users immediate access to all nearby merchants and their latest promotions, and allows for restaurant booking, online ordering and discounted payment by scanning a QR code across 2.5 million partnering vendors.

The function was initially embedded in the popular mobile wallet Alipay before taking the wraps off its ingenious app.

Koubei, or "Word of Mouth", began life in 2015, groomed by Alibaba and its payment affiliate Ant Financial Services Group, to tap into the location-based assortment of catering and entertainment businesses that is projected by consultancy iResearch to reach $230 billion next year.

By leveraging the 520 million monthly active users of Alipay, Koubei has grown into the fastest-growing O2O platform, with the number of daily transactions topping 20 million, according to research firm Analysys.

In the first half of 2017, Koubei's transaction volume hit 167 billion yuan ($25.5 billion), coming in a close second to Meituan-Dianping's 173.2 billion yuan, the result of the merger of two major players that is backed by Alibaba's major rival Tencent Holdings Ltd.

"Koubei's reliance on Alipay has in part hindered it to become a well-known brand," said Yang Xin, an analyst at Analysys.

"Today, the app could give a boost to people's brand awareness of Koubei."

Koubei has recently been aggressively pushing ahead with paying with a QR Code, or a machine-readable code that stores troves of consumer data that vendors can bank on for customer management and precise marketing purposes.