‍Alibaba, China's biggest e-commerce firm, is trying to transcend its identity as an online retail company. On Monday the company announced a decision to try to dominate the offline market as well.

Shanghai's state-owned Bailian Group controls 4700 stores nationwide. Bailian's stock price in the A-share market rose 10 percent to its daily limit on Monday morning.

The reason? Bailian Group announced a partnership with e-commerce giant Alibaba, with the two companies saying they want to build what they call "new retail."

Alibaba's CEO Jack Ma first proposed the idea last October. He believes that a pure e-retail era will soon come to an end, and new retail will quickly emerge in 10 to 20 years. In other words, online and offline markets must both be combined with logistics, to achieve this new state called new retail. Due to ongoing changes in the retail industry, manufacturing in the future will completely convert from B2C to C2B.

The first step of the partnership is to implement Alipay across Bailian's stores. But that's not all. Alibaba has been granting credit and insurance packages to customers on its online platforms. It had been able to do this thanks to its massive collection of consumer data. Now they want to bring this expertise to the offline market, which still accounts for 85 percent of retail sales in China.

It is not the first time Alibaba has partnered with brick and mortar stores. In 2015, it invested some 28 billion yuan in home appliances seller Suning. Monday's partnership announcement doesn't involve capital transactions. But it is another testament to the online consumption powerhouse's ambitions to venture into the offline market.