by Ella Kidron

The COVID-19 pandemic has changed many things about retail, some of the changes are likely to remain for the long haul.  Mr. Chenkai Ling, Vice President of JD.com, and Head of Strategy, JD Retail, shared his views on this during the World Retail Congress’ WRC Connected 2021 virtual event on Apr. 26. The discussion was moderated by Benjamin Zheng, lead partner of global strategy consulting firm EY-Parthenon.

1. Online grocery retail is here to stay

When COVID-19 just started, a lot of consumers flooded into online grocery. This was a deviation from their previous behavior when the top grocery shopping destinations were wet markets, or local, physical grocery stores. “Grocery shopping online is not only a phenomenon but became a habit for many consumers. This is across all ages.” The trend is true across different city tiers. During last year’s Singles Day (November 11^th), new customers for JD Super, JD’s supermarket business, came from lower-tier cities (tier 3-6 cities).

2. New grocery formats are emerging

When it comes to online grocery, many new store formats are popping up, such as the warehouse + physical store format, the front-end warehouse format, the community group purchase format, and the traditional B2B2C format. “We believe that this trend will continue, and online penetration for the grocery category will continue,” said Ling.

3. The rise of the proximity economy

Under the pandemic, many areas were locked down and consumers were relegated to grocery or convenience stores within their apartment compound. “The limitation of movement really helped to promote the proximity economy,” said Ling. This is especially the case in online to offline models. JD has integrated its inventory with a lot of brick and mortar stores closest to the consumers’ apartment compounds, so consumers could place orders and get products within 30 minutes, which is less than a round trip to walk to the store.

4. More individualized consumer demand.

Consumer demands today are even more and more individualized and precise than previously. Ling cited that under the pandemic, consumers’ demand for refrigerators with sterilization capabilities has boomed.  “We saw this trend and we worked with the upstream brand owners to personalize this kind of function, and make it marketable. Later on this became a big success.

Watch the whole session by registering for Retail Connected 2021 here.

Chenkai Ling, JD.com speaks with Benjamin Zheng, EY at Retail Connected 2021 

 

(ella@jd.com)

by Vivian Yang

JD Entertainment, the arm of cultural and entertainment unit under JD.com, and Universal Music Group (UMG) announced on Apr. 26 to deepen cooperation on building the “internet + physical music” ecosystem and co-create a one-stop consumption experience for music fans in China.

In addition to the promotion of physical records, the two sides will also co-develop more high-quality vinyl records and artists’ merchandise.

Garand Wu, managing director of Universal Music China (third from left) and Simon Han, vice president of JD.com (third from right) on the cooperation launch ceremony 

Better hardware performance in recent years has driven people’s increasing need and passion for high-quality music experiences and sales of CD and vinyl records are on the rise.

“Physical music is not out of date,” said Garand Wu, managing director of Universal Music China, at the cooperation announcement ceremony in JD’s headquarters in Beijing. Though streaming music is mainstream now, UMG’s vinyl records achieved 23.5% growth during the pandemic in 2020,  Wu said.

Simon Han, vice president of JD.com pointed out that “JD.com strives to offer the sense of ceremony that many music lovers covet when they wish to enjoy music. By cooperating with UMG, we can provide more high-quality physical music resources to satisfy the diversified needs of our customers and build better connections between artists and fans, enhancing their mindset to seek international music products on JD’s platform.”

Authenticity stays at the core of JD Entertainment’s development. On the one hand, JD Entertainment leverages its capabilities such as OEM (original equipment manufacturer) resources to work with artists to build their authentic merchandise. On the other hand, the platform provides a reliable and convenient shopping experience to boost the fans economy.

“JD’s efforts in copyright protection and capabilities in supply chain, big data, digital marketing and more are widely recognized on the market. This cooperation is a meaningful exploration for us to promote the healthy development of the physical music market in China,” Wu added.

Concurrent with the cooperation announcement, the two sides jointly released the debut solo physical album of Sunnee, a former member of popular Chinese idol group Rocket Girls 101 and a signed singer under UMG. Since pre-sales on JD.com on Apr. 15, the album has become the No.1 pre-sale physical album of the year so far on the platform.

Singer Sunnee released her first physical solo album on JD.com

(vivian.yang@jd.com)

 

 

 

by Rachel Liu

JD.com and leading Chinese E-sports operating company TJ Sports formed a partnership on Apr. 26, to jointly explore the “e-commerce + e-sports” model.

Tao Ren, president of JD Computer and Digital Products and Song Lin, Co-CEO of TJ Sports and Vice President of Riot Games joined the signing ceremony.

TJ Sports is founded by Tencent Interactive Entertainment and Riot Games and focuses on making League of Legends (英雄联盟) e-sports, the most professional, influential and commercially valuable e-sport in China.

The two sides announced that JD will be the official partner of the League of Legends Mid-Season Invitational 2021 in China. In the next two years, the cooperation will also cover activities promotion, brand establishment, new user recruitment, content development and more. JD and TJ Sports also hope to work together on cultivating e-sports talent to build a healthy industry ecosystem.

JD’s influence as leading e-commerce company in China and strong marketing capabilities will bring more innovation to the e-sports industry. Partnering with the e-sports industry will also help JD attract more young customers with significant consumption power.

According to the 2021 China E-Sports Industry Report released by iResearch, e-sports market is expected to reach RMB 55.3 billion yuan in 2021. Nearly 50% of e-sports players are under 22 years old. JD built its own e-sports team JDG back 2017, and holds a highly influential e-sports competition in China every year that gathers both professional players and gaming enthusiasts.

JD is e-sports players’ first-stop to buy gaming products, and the platform’s customer insights support brands to develop more products that better meet customer demand. For example, JD was the first company to create the concept of a “gaming phone” and has jointly developed successful gaming phones with brands including Red Magic, Black Shark and more. JD also promoted the development and launching of gaming computers.

 

(Banner photo: Tao Ren, president of JD Computer and Digital Products (Left), Song Lin, Co-CEO of TJ Sports and Vice President of Riot Games (Right)

 

(liuchang61@jd.com)

by Ella Kidron

JD’s evolution from retailer to supply chain-based company means that it has an even bigger pool of partners to work with. Mr. Chenkai Ling, Vice President of JD.com, and Head of Strategy, JD Retail, shared his views on this during the World Retail Congress’ WRC Connected 2021 virtual event on Apr. 26. The discussion was moderated by Benjamin Zheng, lead partner of global strategy consulting firm EY-Parthenon.

Ling reiterated the importance of JD’s positioning as a supply-chain based technology and services company. “With this definition, which means we are not only a retailer, the boundary [of who can be our partners] has been significantly widened.” Players who might have previously been perceived as competitors from a pure retail standpoint, are partners. Ling identified two key growth priorities for JD. “One is we will continue to expand our retail business, which can help us stay closer to the customer…the other is that we will continue accumulating and strengthening capabilities that we use to allow our business to run smoothly and use these capabilities to empower our partners.”

As an example of how JD intimately collaborates with partners, JD uses its logistics, AI and advanced data analytics capabilities to help brick and mortar retailers to increase their efficiency and better understand their customers.

The company is also pursuing partnerships in some of the hottest spaces and industries. “In China, there are a lot of new retail formats popping up – short videos, livestreaming commerce and content commerce,” explained Ling. JD’s partnership with Kuaishou, a leading e-commerce livestreaming platform, provides a good example. “Last year we formed a strategic partnership with Kuaishou,” said Ling. JD became Kuaishou’s merchandise mid-tier platform, which means JD provides the products and merchandise capabilities to Kuaishou.

A final perspective concerns partnership with brands. “Previously brands and retailers played a zero-sum game; we earn one more dollar, they would lose one dollar,” said Ling. Right now, however, using JD’s capabilities, the company works directly with the brands to identify opportunities, which ultimately “increases the pie” for all.

Watch the whole session by registering for Retail Connected 2021 here.

 

 

 

 

Chenkai Ling, JD.com speaks with Benjamin Zheng, EY at Retail Connected 2021

 

(ella@jd.com)

by Ling Cao

Jingxi, a business group under JD.com focusing on lower tier markets, announced its mascot Niu Fangfang on Apr. 27.

Niu Fangfang (牛方方 in Chinese, which is literally translated as “Square Ox” and is mean to symbolize a “Straightforward Ox”) is an ox. It represents Jingxi’s philosophy of staying true to its original intention, being down-to-earth and reliable, and being honest and straightforward. It also reflects every ordinary person striving to make a living.

The choice of such a mascot is in line with Jingxi’s long-term objective to provide customers with high-quality and cost-effective products. During the Spring Festival in February of this year, Jingxi cooperated with over 1,000 brands and merchants online and offline to ensure livelihoods, as well as to provide non-stop delivery services.

Jingxi also helps its partners lower operation costs and improve efficiency. It has worked with several hundreds of industry chains across the country to help small and micro merchants expand beyond local markets and make a digital transformation.

In April, Jingxi opened its first store for baby and maternal products. By integrating omni-channel supply chain, logistics, marketing and technology capabilities, Jingxi  empowers the store with standardized decoration, pricing and inventory management, and provides training courses, helping merchants to make their businesses more sustainable.

A representative from Jingxi said, “In the future, Jingxi will continue to build a business model which seamlessly combines merchandise, traffic flow and operations, consistently to provide customers with products that has optimized cost and quality, as well as creates more value for partners, promoting the lower-tier market economy as a whole.”

 

(ling.cao@jd.com)