Oct 27, 2020|
JD’s Data on New and C2M Product Consumption
by Hui Zhang
JD released a data report on overall consumption trends related to this year’s new products and consumer-to-manufacturer (C2M) products, and outlined how JD.com helps brands drive sales by co-developing products in a bid to meet consumers’ demands.
Released by JD’s Big Data Research Institute on Monday, the report described how consumption of new products has become a major force assisting China’s post-pandemic economic recovery. Driving this trend are people younger than 40 years old with strong spending power, who are increasingly interested in products that can represent their personalities and preferences.
Big Data Behind New Products
A leading international research company found that while there were thousands of new products launched in the U.S. market in 2014, only seven of them were able to achieve sales of more than $100 million in that year— and it would take another year for about 70% of them to achieve significant sales growth. However, a majority of the new products launched in 2020 in China have been quickly and widely accepted by consumers within only a few months, with the help of e-commerce platforms.
A variety of big data provided by e-commerce platforms helps brands better understand their target consumers, and thus co-develop products to contribute to sales growth.
JD’s data show that the number of new product launches in one month in 2020 exceeded the entire year of 2018, and the number of new product launches in the first three quarters of 2020 is already close to 200% of the number launched in 2019.
Young Consumers Contributing New Product Consumption
According to the report, people who are younger than 40 years old accounted for 85% of new product purchases, with millennials and Gen Z (born after 1995) having the most significant growth. Unlike their parents, the new generation of consumers pay more attention to products’ appearance, designs, background stories, and the overall culture. Computers, mobile phones and other electronic appliances are favored by young people.
New products have become an important way to attract consumers and promote consumption growth. The C2M cooperation model connects the consumer side and the supply side, further accelerating economic recovery.
Nielsen’s report on consumption trends in the home appliances business showed that JD’s supply chain capabilities have helped to improve communication efficiency between brands and consumers by integrating big data and AI to co-develop C2M products with brands.
For example, JD and Xiaomi jointly launched a new C2M mobile phone exclusively on JD: The Redmi K30 5G Racing version. In the first two minutes following the phone’s release on May 14th, sales had already surpassed RMB 10 million yuan, with a unit price of RMB 1999.00 yuan. Over 10,000 phones were sold in 11 minutes, and over 20,000 phones were sold that day.
In addition to Xiaomi, JD also works with many other well-known companies such as LG, Mars, and Mead Johnson to co-develop C2M consumer-driven products.
In cooperation with Lenovo, both sides set up a B2M platform leveraging JD’s big data, nationwide logistics and supply chain to enable enterprise clients on JD to submit individual needs, based on which Lenovo can design and manufacture customized products accordingly.
“What we talked about the most with foreign supply chain partners is just the price, while the cooperation between JD and Lenovo always focuses on consumers’ demands, which help us co-develop the products that meet consumers’ needs,” said Weichang Li, general manager of Lenovo’s PC Consumption department.
“The data analysis provided by JD has brought great help to Lenovo’s product design and helps us target the consumers more accurately and provide the right products for them,” Li added.