E-Commerce, Supply Chain & the Dual Circulation Economy

by Ella Kidron and Rachel Liu

The first China International Consumer Products Expo will be held in Haikou, Hainan province from May 7-10. China’s largest retailer, JD.com, has an exhibition booth in partnership with top brands from around the world, as well as a range of events and initiatives to take place during the expo. The expo is particularly significant because it symbolizes the first major event held in the region since the Hainan Free Trade Port was announced. Since January this year, JD has already opened two duty-free stores offering an omni-channel duty-free experience. Its presence at the expo is a demonstration of the important role that retailers and supply chain players can play in the dual circulation economy, a priority of the Hainan Free Trade Port.

Lei Xu, CEO of JD Retail, said: “We are honored to participate in the first China International Consumer Products Expo. Consumption upgrade is an unstoppable trend. Consumers’ demands are getting more fragmented, diversified and personalized. People hope to buy whatever they want, whenever and wherever they want it. This has created many new consumption models and scenarios.”

 

Overview of the expo

According to the master plan on its construction, the Hainan Free Trade Port’s preferential tax policies will encourage foreign investment and foreign manufacturers to export their products to the region, while offshore duty-free shopping policies will lure many of China’s 1.4 billion consumers with sound spending power and clear demands to travel to purchase goods in the region. In other words, the Hainan Free Trade Port is highly aligned with the “dual circulation” strategy of promoting “internal circulation” (the domestic economy” and integrating it with “external circulation” (the global economy.)

Xu added: “This Expo can not only use the advantages of Hainan Free Trade Port to improve the supply in the domestic market and meet customers’ demands for more high-quality products, but also can improve the opening up and the dual circulation of domestic and international markets.”

 

JD’s presence

JD will host a 500 square meter booth in Exhibition Hall 1 of the Hainan International Convention and Exhibition Center, Haikou, Hainan province. Products from its nearly 70 top international brand partners will be on display. In addition, JD’s business units and affiliate businesses such as JD Logistics and JD Health, will exhibit advanced technology and services. The company will sign partnerships with nearly 20 international and domestic brands furthering its relationships with brand partners.

JD Logistics will also offer a shipping station for ambitious shoppers who want to take advantage of the expanded duty-free quota offered during the expo as well as brands and enterprises who need to ship products back home, bringing JD Logistics’ convenient delivery station experience into the convention center.

 

JD Worldwide – pushing the frontier of imports

As JD’s platform for imported products, JD Worldwide plays a key role in this year’s participation at Hainan Expo. Imported products that sell well on JD, covering beauty, food, personal care and health care products, will be on display.

JD Worldwide will also announce partnerships with five imported brands, namely Perrier, New Zealand diary brand Fonterra, Nestlé, Fortune Pharmacal from HK, and South Korean personal care brand Amorepacific Group, to further cooperate on cross-border business and explore the emerging duty-free business.

The platform will also hold a forum together with China Customs Media Center during the Hainan Expo, to introduce the latest policies of cross-border business and imported products consumption trends. JD Worldwide will introduce a new project that it jointly develops with China Certification and Inspection Group to build on the imports platform’s ability in products authenticity inspection and provide customers a more trustworthy shopping experience.

“By joining the Hainan Expo, we hope to achieve three goals,” said Frank Yu, general manager of marketing and operations of JD Worldwide: “We hope that by using this influential platform, we can improve JD Worldwide’s brand recognition in the imports industry, and better communicate with overseas brands on the abilities of JD Worldwide to attract more brands to join our platform. Furthermore, we hope to work closer with Hainan on the emerging duty-free business, which we believe has great potential in the next few years.”

 

Increased push into duty-free

Since launching new duty-free policies on Jul. 1, 2020, raising the individual annual quota for offshore duty-free shopping from RMB 30,000 yuan to RMB 100,000 yuan, and expanding the tax-free categories from 38 to 45, including electronics products and wine, consumers have been flocking to Hainan. Reports from the General Administration of Customs said that Haikou Customs supervised sales of duty-free goods worth RMB 12.01 billion yuan in the four months since launching the policy, up 214.1% YOY, and the number of customer visits reached 1.78 million, up 58.8%. Cosmetics, watches and jewelry accounted for 72.8% of the total tax-free sales in the island’s four duty-free shopping centers.

JD made its move into the duty-free industry by opening a store through partnering with Hainan Tourism and Investment Development Co. in Sanya, Hainan province on Dec. 30, 2020. It has since opened another one. Together, the stores provide a duty-free experience unlike traditional duty-free stores. Moving away from the traditional duty-free categories of fashion, luxury, cosmetics, alcohol and cigarettes, JD has gone in an entirely different direction, using its supply chain advantages to equip the stores with consumer electronics and small appliances such as hair dryers, speakers and coffee machines, attracting a much wider variety of consumers to duty-free shopping than previously.

“As Hainan is developing a Free Trade Zone, the duty-free business will be the most important part of JD Worldwide’s development in Hainan in the next few years,” said Yu. “Our plan is to continue focusing on cross-border business, joins force with general trade business and develop duty-free business.”

In the future, JD Worldwide is considering building a self-operated shopping mall in Hainan, featuring duty-free and cross-border products and plans to explore new innovative models. Following the successful cooperation with Hainan Tourism and Investment Development Co. and the opening of two stores under the cooperation, JD Worldwide will continue to explore and cooperate with more companies with duty-free business, and find more innovative models to open offline stores. “The joining of Internet giants like JD can bring more innovation to the highly traditional business, such as providing digital solutions.” Yu added. JD Worldwide will open its advantages on digitalized solutions to partners to provide them more concise customer profile, their shopping preference and the ways to reach out them through online and offline channels.

 

Cooperation beyond retail

Beyond duty-free and even retail, there are a wealth of areas that JD could explore within the context of the Hainan Free Trade Port. In addition to promoting the exchange and movement of high quality products and services, smart city, smart logistics and other ventures are all promising areas to potentially explore. The expo is only a taste of what could be around the corner.

“JD will maintain an attitude of openness and accelerate the creation of win-win ecosystems based on digital smart supply chain,” said Simon Han, vice president of JD.com and head of JD’s V business group (“V” stands for victory), which includes JD Worldwide, at the Hainan Expo. “We hope to join forces with more partners and share in the development opportunity offered by the Hainan Free Trade Port.”

 

(ella@jd.com; liuchang61@jd.com)

by Guo Ji

JD signed partnership agreements with leading international brands at the China International Consumer Products Expo at the Hainan International Convention and Exhibition Center, Haikou, Hainan province (May 7-10). Brands include the likes of, Fonterra, Ferrero, Mars Wrigley, SC Johnson, GOO.N, Nestlé and Perrier.

Here are a few highlights on the partnerships:

Fast-Moving Consumer Goods  

Anchor and JD to further cooperation in food and duty free business

JD and Anchor, a brand under New Zealand dairy giant Fonterra, will further cooperation in in imported food channels and explore the possibility of developing duty-free business. Anchor joined JD Super, JD’s online supermarket, in 2014 and has ranked first in imported milk sales for four consecutive years since 2017. It is also a founding member of the JD Super + JD PLUS organic alliance which provides organic brands with robust marketing solutions.

Yu Zhao (left), head of external partnership development for JD FMCG Omnichannel and Weizhuo Jin, director of business strategy for the consumer products department at Anchor Trading (Shanghai) Co. Ltd.

Ferrero and JD to deepen product co-creation systems

JD and Ferrero announced that they will make full use of their respective resource advantages to work together in brand maintenance, user operations, big data marketing ecosystem and the establishment of a data-driven new product co-creation system. In order to meet the needs of new consumers, the two sides will also carry out cooperation in R&D of new products and in the co-creation of new products. Ferrero entered the Chinese market in as early as the 1980s and partnered with JD beginning in 2015. IT has since become a top brand in the chocolate category. More opportunities for collaboration between Ferrero and JD will be opened up in the future.

Yu Zhao (left), head of external partnership development for JD FMCG Omnichannel and Mario Gabbi, president of China region sales for Ferrero

Mars Wrigley and JD to accelerate growth in confectionary and chocolates

Mars Wrigley and JD signed a cooperation agreement to accelerate growth in the confectionary and chocolate category, making full use of each parties’ resources and advantages to drive industry growth. Mars Wrigley, which is the world’s leading manufacturer of chocolate, chewing gum and other candies behind popular brands including Snickers, M&Ms and more, joined JD’s platform in 2014, with annual sales exceeding RMB 340 million yuan in 2020. The company’s other division, Mars Petcare, previously cooperated with JD to launch a high-end healthy C2M cat food product called NutroMax in the same year.

Yu Zhao (left), head of external partnership development for JD FMCG Omnichannel and Gang Teng, vice president of business affairs, Mars Wrigley China

SC Johnson and JD to focus on omni-channel and precise marketing

Leveraging JD.com’s technology strength and omnni-channel capabilities together with S.C. Johnson’s renowned brand and high-quality product advantages, both sides signed a cooperation agreement to enhance a multi-scenario, digital and intelligent cooperation. S. C. Johnson is a leading manufacturer of household cleaning products and products for home storage, air care, pest control and shoe care, as well as professional products. Through the cooperation, S. C. Johnson aims to expand its business scope in northeast Asia, explore omni-channel cooperation and improve precision targeting thanks to JD’s technology strength. S. C. Johnson joined hands with JD in 2015. Both sides have already explored cooperation possibilities in marketing, packaging, and C2M innovation to meet various rising demands from Chinese consumers.

Yu Zhao (left), head of external partnership development for JD FMCG Omnichannel and Lijian Liu, senior vice president of the Asia region for SC Johnson

GOO.N and JD to further partnership in e-commerce

GOO.N signed a cooperation agreement with JD.com during the event, aiming to mutually share resources, and take advantages of both sides’ advantages to explore in-depth business cooperation in e-commerce. GOO.N is a premium baby diaper brand, produced by one of the largest paper products manufactures in Japan, Daio Paper Corporation established in 1943. GOO.N has established partnership with JD since 2015 and it has embraced great sales performances on JD since then.

Yu Zhao (left), head of external partnership development for JD FMCG Omnichannel and Chairman and Masaro Suzuki, Senior Director of GOO.N (Nantong) Life Products Co. Ltd. 

Nestlé and Perrier to explore duty-free partnership with JD

Several international brands signed partnerships with JD on duty-free business during the event, including Perrier and Nestlé, aiming to explore and develop Hainan’s market under mutual support, as well as leading industry growth as a whole.

Yongzhi Xie (left), director of JD Worldwide and Nan Luo, manager of  international brands, Nestle Water

JD is consistently acting as a bridge between international brands and Chinese markets.

Nestlé is JD’s long-term partner and the companies have cooperated in precise marketing, sales, healthcare and logistics. In April, JD and Nestlé agreed to promote allergy prevention and management in infants and toddlers. Through the cooperation, both parties will work together to set up a specialized food center within JD’s App to provide formula or food for infants and toddlers with special medical needs. In September 2020, Nestlé partnered with JD Logistics on an intelligent digital operations system in Nestlé’s north distribution center in Tianjin to improve fulfillment efficiency.

Yongzhi Xie (left), director of JD Worldwide and Wei Tang, Director of e-commerce KA, Nestle

JD Worldwide also signed a partnership with Fonterra, following the brand’s partnership with JD Super Ominchannel yesterday, reflecting the wide range of areas that JD and the brand house can work together

Yongzhi Xie (left), director of JD Worldwide and Yueming Zhai, manager of e-commerce marketing, Fonterra

Consumer Electronics

Sony and JD to explore consumer innovation

Sony China inked an agreement with JD.com to explore innovation in consumer reach, products, scenarios and more taking advantage of both companies’ abundant experience in online operations and marketing. Sony and JD will do research into consumption behaviors and co-create events to enhance consumer traffic. Furthermore, inventory will be arranged based on customers’ needs. Sony and JD also plan to create trending social content and more. Through the collaboration with JD.com, the brand has been able to expand its businesses in the fields of audio, gaming, gaming TV, mobile phones and more. This March, JD and Sony jointly launched a customized gaming TV.

 

Baijie Zhang, manager of JD consumer electronics and Dezheng Pang, general manager，Hainan branch of Sony China. 

 

Bose and JD to enhance omnichannel operation

Global audio equipment leader Bose and JD.com will deepen its cooperation in omni-channel operations. Combining JD’s experience in precise marketing, supply chain and logistics, Bose will bring its best-in-class products to JD’s sales channels online or offline including JD Retail Experience Shops, Jingxi, JD’s social e-commerce platform targeting lower-tier markets, and more. The cooperation will help Bose create a digital sales and operations solution. Bose has been partnering with JD since 2014. During JD’s 618 Grand Promotion (Jun. 18) in 2020, JD and Bose have jointly held livestreams and provided special gift sets for customers.

Xiuji Wu, manager of JD consumer electronics division and Yiya Ding, general manager, sales, Bose

Auto

ExxonMobil and JD to strengthen cooperation on users, digitalization and service network

JD.com and ExxonMobil will deepen cooperation in three main areas in China, which include user engagement, digitalized e-commerce operation and omni-channel service network. Based on the agreement, JD Auto will become one of the first online platforms to launch Mobil’s new products in China. Furthermore, the two sides will integrate JD’s Customer-to-Manufacturer approach and Mobil’s oil analysis programs Mobil Serv℠ to create more tailor-made lubricant products for Chinese customers. From online ordering to offline services, the two sides will embrace omni-channel solutions to create more reliable and easily accessible services. No matter whether the products are delivered to customers’ homes directly or their designated nearby JD Auto Service stores, customers are guaranteed with the standardized price and service quality provided by both JD and Mobil. Meanwhile, customers will be able to enjoy more shared benefits from both JD Auto and Mobil’s membership programs.

From left to right:  Qin Miu, vice president and head of life & service business division of JD.com;  Minxian Wang, general manager, self-operated automotive products, JD Auto; Yulong Cui, general manager, new retail business, ExxonMobil (China) Investment Co., Ltd; Chunyang Yue, Managing Director of ExxonMobil (China) Investment Co., Ltd

Continental Tires and JD Auto to enhance omni-channel cooperation

Continental Tires and JD Auto reached an agreement to enhance omni-channel cooperation. Based on JD’s nationwide car maintenance service network that combines online ordering and appointments and offline services, known as JD Auto Service, the two sides will explore tailored services for both business partners and customers. Additionally, Continental will supply UltraContact J type tires to be sold exclusively on JD’s platform.

From left to right:   Minxian Wang, general manager, self-operated automotive products, JD Auto;Qin Miu, vice president and head of life & service business division of JD.com; Yifeng Zhao, e-commerce department, Continental China; Mingyou Tang, head of sales, Continental China.

 

 Visit JD.com’s booth in Exhibition Hall 1 of the Hainan International Convention and Exhibition Center, Booth 1T014 to learn more.

 

 (press@jd.com)

by Vivian Yang

JD.com and ExxonMobil made joint announcement on May 7 to deepen cooperation in three main areas in China, which include user engagement, digitalized e-commerce operation and omni-channel service network.

“This cooperation marks a key milestone of the partnership we reached last May to leverage both sides’ strength in intelligent supply chain to coalesce brands, platforms and customers, and to co-create customized products and enhance service efficiency,” said Qin Miu, vice president and head of life & service business division of JD.com.

“We hope this upgraded cooperation with JD will bring more high-quality products and car maintenance services for Chinese customers,” noted Chunyang Yue, managing director of ExxonMobil (China) at the signing ceremony held during the China International Products Expo in Hainan province.

Based on the agreement, JD Auto will become one of the first online platforms to launch Mobil’s new products in China. Furthermore, the two sides will integrate JD’s Customer-to-Manufacturer approach and Mobil’s oil analysis programs Mobil Serv℠ to create more tailor-made lubricant products for Chinese customers.

Mobil’s products are sold on JD.com through both JD’s self-operated online store and the brand’s flagship store. The former became the first store to surpass 3 million followers in the motor oil category on JD’s platform.

From online ordering to offline services, the two sides will embrace omni-channel solutions to create more reliable and easily accessible services. No matter whether the products are delivered to customers’ homes or their designated nearby JD Auto Service stores, customers are guaranteed the standardized prices and service quality provided by both JD and Mobil. Meanwhile, they will be able to enjoy more shared benefits from both JD Auto and Mobil’s membership programs.

With JD’s extensive capabilities in digitalization, the cooperation will also give a boost to the global motor oil giant on digital marketing and e-commerce implementation in the Chinese market.

(Banner photo(from left to right) :  Qin Miu, vice president and head of life & service business division of JD.com;  Minxian Wang, general manager, self-operated automotive products, JD Auto; Yulong Cui, general manager, new retail business, ExxonMobil (China) Investment Co., Ltd; Chunyang Yue, Managing Director of ExxonMobil (China) Investment Co., Ltd)

(vivian.yang@jd.com)

by Ling Cao

JD exhibited a series of C2M (Customer-to-Manufacturer) products at the on-going China International Consumer Products Expo held in Haikou, Hainan province (May 7-10).

C2M products are representative of the latest consumption trends, as they are designed based on what consumers want. “We released a JD’s private label brand J.Zao C2M product, the laundry capsule, and the product was among the top 5 search results in just one week,” explained Wen Xue, an operations manager of JD’s Y business team focusing on supply chain technology, onsite at the Expo.

“The product was designed based on customers’ demands on purchasing  laundry detergent that not only can clean clothes, but also have functions such as bacteriostasis, elimination of mites, color protection and maintain fragrance,” added Xue.

“We found that children’s tables and chairs are top 10 by customers’ search, while there aren’t cost-effective, so we seized the market chance to design an imported wooden table and chairs set for RMB 1,000-1,500 yuan. One of our C2M sets which has been on sale since last October is consistently top one by sales volume and customer’ comments,” shared Hengsheng Tang, general manager of J.Zao at JD.

JD also displayed other C2M products created with partners at the expo, including a GoPro HERO 9 BLACK gift set, which is based on real customers’ feedback for buying an action camera with higher resolution, enhanced anti-shake, as well as ultra-long battery life.

L’Oréal worked with JD to design the C2M facial cream and toner which based on young customers’ need to moisturize in fall and winter, as well as demands to diminish pores. The products are popular in their categories on JD.

Over 1,000 brands worked with JD’s Y business unit on C2M product design and sales to date.

 

(ling.cao@jd.com)

by Ella Kidron

GOO.N, a leading Japanese diaper brand, launched its new pull-ups product on JD at the International Consumer Products Expo (Hainan Expo) in Haikou, Hainan province on May 6. The product is especially designed to ensure comfort for babies during the summer months. JD announced the product during a press conference held at its expo booth, while the product was simultaneously made available for booking on JD.com’s online platform.

Chairman and Senior Director of GOO.N (Nantong) Life Products Co. Ltd. Masaro Suzuki (铃木正郎) emphasized a desire to continue working with JD.com to provide high quality products to Chinese consumers across the brand’s different lines. The name GOO.N comes from the Japanese “gun gun” which refers to a baby’s steady growth. The GOO.N brand name reflects the brand’s desire for all babies to keep growing.

 

Zhao of JD.com (left) and Suzuki (right) with event host unveiling new product

Yu Zhao, head of external partnership development for JD FMCG Omnichannel, said: GOO.N has over 70 years of history, establishing its China factory in 2013 an is one of the most important partners for JD in its product category. The maternal and child market in China is developing more and more rapidly and consumer demands are getting precise and demands for high quality products keep increasing. This new product demonstrates GOO.N’s attention to customer experience and attentiveness to customer demands and continued innovation to provide new products for the Chinese market. Zhao emphasized that GOO.N will continue to be an important partner for JD going forward. GOO.N and JD also signed a broader partnership agreement.

JD has a dedicated 500 square meter booth in Exhibition Hall 1 (1T014) at the Hainan Expo where consumers, brand partners and government officials can experience a wide range of products sold on JD as well as technology used throughout its business.

 

(ella@jd.com)