China’s voice recognition king iFlyTek goes against the grain with forecast that offline sales will grow more

China’s artificial intelligence (AI) speech recognition champion iFlyTek is going against the grain with a bet that bricks-and-mortar sales will remain a major retail sales channel in future.

The Hefei-based company expects offline stores to steadily rise and contribute around 70 per cent of its total sales in future, from an even split between online and offline last year, according to iFlyTek vice-president Li Chuangang. He did not specify an exact date for the forecast.

The company plans to open 1,000 physical stores this year, bringing its overall offline retail network to about 3,000, he said, adding that despite an increase in expenditure on the infrastructure, offline shops are still necessary.

“Some internet companies start with e-commerce, finding it easier [to manage],” he said after a briefing, a transcript of which was verified by the company on Thursday. “But to be a truly great brand, an offline [sales channel] is indispensable and will play an increasingly important role as brands grow.”

Shenzhen-listed iFlyTek has two online virtual stores and is working with 20 authorised sellers on Alibaba’s Tmall platform, while maintaining about 6,000 shop attendants at physical shops.

“An ideal target for offline sales is around 70 per cent,” said Li. “We believe it [offline] still has great potential.”