JD Worldwide Supports Overseas Merchants Growth in China

Posted on by Rachel Liu

by Rachel Liu

During JD’s Singles Day Grand Promotion (November 1st – 11th) this year, JD Worldwide saw sales improve in multiple categories, and total sales in the 11 days increased 50% YoY. Many medium-to-small merchants have taken the opportunity to leverage the support provided by JDW to achieve a sales boost.

Seeing that many overseas merchants are not familiar with e-commerce operations in the Chinese market, JDW began to provide trainings on store operations targeting the pain points of different categories since September. Hundreds of merchants have improved their operation efficiency through learning from the livestream courses.

AMPLEUR flagship store, a store focused on beauty products, saw its daily sales double after taking the trainings. The store was launched on JD over a year ago, but before the course it had been troubled by poor sales performance and low marketing ability. After taking the training specifically designed for cross-border beauty brands, the store leveraged big data analysis to understand that most of the customers found the store through searching for the name of the brand. After increasing exposure of the brands’ name, the store doubled its daily sales during the Singles Day period.

Complicated logistics transit and high warehouse management fees are additional challenges for overseas merchants. Sending the wrong products and broken packages used to be common and caused many complaints. In response, JDW has also developed solutions for logistics problems. Electronic Partner flagship store on JDW decided to move all their products to JD Logistics’ warehouse in Hong Kong, and saw their order collecting speed and fulfillment satisfaction greatly improved. The logistics cost for the store also decreased as they could enjoy JD’s subsidy.

On October 30th, JDW also launched a smart operation tool to help stores analyze their problems and provide customized suggestions through algorithms. With the help of technology, the stores can achieve better sales performance through smart and detailed operations. JDW will work with leading international brands such as Shiseido, Wyeth and Swisse to further upgrade the service ability of the tool and benefit more merchants.

 

(liuchang61@jd.com)

JD and Tsinghua University Launch Supply Chain Trends Report

Posted on by Ling Cao

by Ling Cao

JD Big Data Research Institute and Tsinghua China Data Center (CDC) have jointly launched a report on digitalized and intelligent supply chain development trends in China. According to the report, the open supply chain provided immense value for customers and brands during the latest Singles Day Grand Promotion (Nov. 1st-11th), helping to optimize cost, efficiency and experience. Going forward, supply chain development will be led by three trends: digitalization and intelligence, integration, and socialization.

Yiming Wang, vice chairman of the China Center for International Economic Exchanges (CCIEE) and former vice president of the Development Research Center of the State Council (DRC) shared four suggestions for the future of supply chain development: “Integrate online and offline, develop digitalized applications, improve an inclusive and prudent regulatory system, and optimize digitalized innovative ecosystem.”

Yiming Wang speaks during the event

Xianchun Xu, director of the China Data Center of Tsinghua University and former deputy director of the National Bureau of Statistics said, “The digital economy is developing rapidly. Digital technology is influencing the enterprises’ production and operations, the way of governance and people’s lifestyles. It can penetrate every aspect, and promote technological progress.”

Xianchun Xu speaks at the event

JD and Midea have cooperated in supply chain and provide an example of how digitalization and intelligence can achieve synergy. The companies have worked together in inventory forecast, procurement and fulfillment in order to achieve cost-effective operations. As a result, the automatic ordering process in the warehouse has improved from 10% to 30%, and transportation allocation optimization of refrigerators between warehouses has saved RMB 6 million yuan.

During Singles Day, JD’s smart supply chain helped 33,000 brands covering 5 million products with sales forecasting, and algorithms enabled 200 cities to realize putting the most frequently bought inventory nearest to customers.

Consumer-to-Manufacturer (C2M) is an example of supply chain integration. During Singles Day, JD sold over 100 million C2M products. C2M home appliances sales increased five times YoY, accounting for 26% of home appliance sales.

JD’s cloud warehouse solutions, fast drug delivery and auto services are all examples of how supply chain socialization can be applied in omnichannel strategy, making the whole process more agile.

According to the report, as a technology and service company with supply chain at its core, JD’s open strategy for supply chain creates great social value. First, it can help with transform the supply side and promote China’s high quality economic development. Second, it can help with dual circulation. Last, it can help unlock consumption potential.

Yiming Wang added, “Promoting the digital transformation and integration of smart supply chain and the real economy can effectively improve production efficiency and the profitability of enterprises, and inject new momentum into high quality development.”

 

(ling.cao@jd.com)

River Snail Noodles and JD’s Smart Supply Chain

Posted on by Yuchuan Wang

by Yuchuan Wang

At the processing plant in Liuzhou, a third-tier city in Guangxi Zhuang Autonomous Region in South China, JD’s cargo vans are loaded up with packages of ready-to-eat Liuzhou rice noodles. Within just 24 hours, these packages will be delivered to customers’ doorsteps across China by JD.

People always describe Liuzhou rice noodles as “stinky but delicious”. Also known as Luosifen or river snail noodles, the dish has become one of the best-selling ready-to-eat food for quarantine foodies and named a “national dish” by Chinese netizens. According to the Commerce Bureau of Liuzhou, the production value of ready-to-eat Liuzhou rice noodles is expected to reach RMB 9 billion yuan this year.

ready-to-eat Liuzhou rice noodles

Despite the popularity of the dish, many manufacturers have found that the business is not easy to operate. Liuming Huang, founder of Liuguan Liuzhou Rice Noodles, said that the operating costs of warehousing and transportation used to be quite high.

In early 2020, Huang’s company began to cooperate with JD Logistics (JDL). With the help of JD, logistics became worry-free for Huang. JD helps package products in his processing plant and transports them to JD’s warehouse in Liuzhou. Once a customer places an order online on JD, the products will be distributed directly from the warehouse and delivered to customers in 24 hours.

Liuming Huang (right), founder of Liuguan Liuzhou Rice Noodles and his staff

Liuming Huang (right), founder of Liuguan Liuzhou Rice Noodles and his staff

“The integrated supply chain service provided by JD Logistics has helped us save at least 20% in labor costs and has greatly lowered the damage rate,” said Huang.

“JD Logistics will continue to speed up its development in lower-tier markets. Leveraging supply chain technologies and services, JD hopes to build the bridge between manufacturers and end users through smart supply chain,” said a JD Logistics representative.

 

(yuchuan.wang@jd.com)

JD’s Green Stream Initiative Won 2020 Paulson Prize for Sustainability

Posted on by Vivian Yang

by Vivian Yang

The Green Stream Initiative, JD’s green supply chain program has been awarded a 2020 Paulson Prize for Sustainability, as announced on November 18 in Beijing at a virtual streaming award ceremony.

Certificate of the excellence award of the Green Innovation Category of 2020 Paulson Prize for Sustainability

Certificate of the excellence award of the Green Innovation Category of 2020 Paulson Prize for Sustainability

The Prize is jointly organized by The Paulson Institute and Tsinghua University, with an aim to identify and award sustainability-focused projects in China that provide innovative, scalable, and market-based solutions at the intersection of economics and the environment.

JD’s sustainability program was nominated among over a hundred applications and selected among the top four finalists in the Green Innovation Award category in this year’s Prize evaluation process. Jurors of the Prize include Zhuang Weimin, Academician of Chinese Academy of Engineering; Sonja Gibbs, managing director and head of Sustainable Finance, Global Policy Initiatives, Institute of International Finance; Wang Shi, Founder of China Vanke; Tracy R. Wolstencroft, former president and CEO of the National Geographic Society; and Simon Zadek, principal of Project Catalyst, United Nations Development Program.

“This award is designed to promote solutions that address the urgent challenges of ecological degradation and biodiversity loss,” said Henry M. Paulson, Jr., Chairman of the Paulson Institute and former US Treasury Secretary. “We want to inspire governments, businesses and citizens to be good stewards of nature by valuing and investing in the conservation and restoration of China’s natural heritage and chart a better course for our planet.”

“We are honored to receive the excellence award of this year’s Paulson Prize for Sustainability, and have the opportunity to communicate with international and Chinese experts and leaders in this area,” said Jerry Duan, head of the Green Stream Initiative at JD. “With increasing recognition and influence of the Green Stream Initiative in China’s e-commerce and logistics industries and beyond, we hope to engage with more partners in this innovation-driven environment protection effort.”

JD Logistics (JDL)'s Green Stream Team at the virtual award ceremony JD Logistics (JDL)’s Green Stream Team at the virtual award ceremony 

JD.com, as China’s largest retailer and a leading logistics provider, is pioneering the ecosystem approach to green supply chain management in China. Under the “Green Stream Initiative” which was jointly initiated by JD and its partners, including P&G, Nestle, Lego, Unilever, WWF, and more in 2017, a number of decarbonizing actions have been implemented throughout the supply chain, covering multiple stages of packaging, warehousing, transportation and more.

To date, this program has distributed recyclable delivery boxes in nearly 30 cities in China, which have been used over 16 million times. JD also uses over 8,000 new-energy vehicles in approximately 40 cities. During the past Singles Day Grand Promotion period (November 1st -November 11th), the Green Stream Initiative helped reduce packaging waste by 100,000 tons.

At the same time, JD launched the Green Packaging Alliance and China’s E-commerce & Logistics Packaging Standards Alliance, which developed the industry’s first packaging standards and is playing an important role in promoting the industry’s environmentally-friendly development.

JD Logistics (JDL) is China’s first logistics company to join the Science Based Targets initiative (SBTi), an ambitious global campaign aimed at driving corporate action on climate change. It is committed to reduce 50% carbon emissions by 2030 (starting from 2019). The target was approved and listed on SBTi’s official website on November 12th, 2020.

 

(vivian.yang@jd.com)

 

Posted in ESG

JD Health CEO: COVID-19 To Advance Online Health Industry By Five To Ten Years

Posted on by Martin Li

by Martin Li

The COVID-19 pandemic will advance development of China’s online health industry by around five to ten years, according to Lijun Xin, CEO of JD Health.

Xin joined CNBC’s annual East Tech West event in Nanshan, Guangzhou on November 18 and shared insights on the industry with Evelyn Cheng, CNBC’s Beijing correspondent. The event is a by invitation-only retreat and brings together people at the cutting edge of the technology industry and leading investors from around the world.

“After the outbreak, we saw a robust growth in the number of people who used our online medical consultation. Currently, this momentum doesn’t’ stop. The number is not decreasing,” said Xin.

Consumers in China have been forming the habit of seeking online medical service because they found they can have access to rich medical resources including prestigious doctors online, according to Xin.

“However, the pandemic has not only impacted consumer behavior. Its impact has been also felt by regulatory bodies and medical institutions, which have been actively pushing forward application of the Internet in the health industry,” said Xin.

Regulatory bodies in China have released many policies to facilitate the development of the online health industry. They have encouraged hospitals to seek online transformation and make it easier for patients to use medical insurance for online consumption, according to Xin.

Xin also predicted a fast application of technologies like IoT and AI in the health industry.

“JD Health’s platform has been connected with a huge number of health IoT devices like the blood pressure test device,” said Xin.

Xin told the story of a recent patient. “When a patient was using an Omron blood pressure meter during exercising, his blood pressure registered as abnormal. The patient didn’t know it, but our doctor knew and called him. That’s because the data was immediately transferred to his doctor through IoT.”

Application of technology in the health industry will help proactively manage people’s health, not just for treatment, according to Xin.

 

(bjlihao3@jd.com)

 

JD Worldwide Sources Products Directly from International Malls

Posted on by Rachel Liu

by Rachel Liu

JD Worldwide (JDW), JD’s platform for imported products, announced on November 15th that it will be working with leading international shopping malls and e-commerce platforms to directly source products from their offline stores or official websites. Popular partners from Japan, US, South Korea and more countries including Rakuten, Kintetsu, AUTOBACS, SOLETRADER, Muller, AKPLAZA, LUXBOY, Tiendas Agatha and Qoo10 have joined the project. Malaysian e-commerce platform PGMALL will be the next to join.

JDW works directly with the partners to launch the latest products, such as Burberry watches, Samsonite suitcases, Dyson vacuums and more from their stores or online platforms simultaneously on JDW. Previously, the partners’ flagship stores featured on JDW were not always the most up to date versions. JDW will transfer the orders to the partners for them to send products to customers directly from overseas, without third-party transit.

JDW works directly with the partners to launch the latest products, such as Burberry watches, Samsonite suitcases,

Partners usually delivered imported products through the bonded warehouses, which could take a relatively long time for the orders to reach customers’ hands. Now, the direct source project allows customers to enjoy authentic new products from all over the world in the fastest way. For partners, this not only adds a new sales channel in China with lower logistics and warehouse cost, but also help them test the Chinese market and cultivate best-selling products in a convenient way. Additionally, JD Worldwide can offer richer imported product choices for customers through this project, especially non-standardized and high-value products like fashion and electronics.

To optimize customer experience, JDW provides special services for the flagship stores which joined the project, such as exclusive customer service and 30-day quality assurance. Any shopping malls or e-commerce platforms interested in tapping into China’s market through JD Worldwide can apply via https://www.jd.hk/cooperation_en or by emailing worldwide@jd.com.

 

(liuchang61@jd.com)

JD Q3 2020 Earnings: Putting Consumers Front-and-Center Brings Strong User Growth to JD

Posted on by Hui Zhang

by Hui Zhang

JD.com’s unwavering efforts in always positioning consumers at the center of its business have been reflected in its user growth. JD’s annual active customers reached 441.6 million by the end of the third quarter, 32% up from a year ago. This is the highest annual growth rate in the past three years. On the Nov. 16 earnings call to discuss the results, JD’s management team attributed the strong growth to the strength of its supply chain and services, both of which have made JD a highly trusted platform, as well as improved user engagement in lower tier markets.

Sandy Xu, CFO of JD.com shared that the company obtained more than 24 million net additional customers in the third quarter. The robust growth of the number of active users validates the company’s long-term operating philosophy to put its customers at the center of its business. Eighty percent of JD’s new users this quarter came from lower-tier c markets.

Core users on JD were found to buy products from more categories and more frequently, making JD an important part in consumers’ daily lives. The number of JD PLUS members exceeded 20 million in October, a milestone for its paid membership program. JD PLUS was the first paid e-commerce membership program in China designed to better serve its core users besides the benefits offered on JD app such as shopping rebates and free shipping coupons. JD PLUS has partnered with over 600 industry-leading brands to provide its members with comprehensive privileges in sectors such as movie tickets, travel, hotel bookings, education, dining and entertainment. JD’s data shows that JD PLUS has effectively improved the engagement and retention of its core users.

Lei Xu, CEO of JD Retail explained, “For the new users, they’ve already been educated and have been calibrated through other platforms. When they become more mature and more customized online shoppers, they will shift to a platform that can provide better services for them.” He added: “ We have a better competitiveness to match the shopping behavior for more and more customers.”

 

(zhanghui36@jd.com)

JD Q3 2020 Earnings: The “35-Cents Theory”, JD’s Business Principle with its Partners and Employees

Posted on by Vivian Yang

by Vivian Yang

“If we make $1 profit, 30 cents go to our business partners, 35 cents for our employees and the remaining 35 cents for JD’s continuous growth,” said Jon Liao, Chief Strategy Officer of JD.com during the company’s third quarter earnings call on November 16th, as he explained JD’s “35-Cents Theory” put forward by Richard Liu, the company’s founder and CEO.

Guided by this business principle, “JD is fully committed to a healthy ecosystem relying on cooperation, coexistence and co-evolution,” Liao added.

An analyst during the call mentioned that, under the impact of COVID-19, more and more brands and merchants are willing to use JD’s services. This not only demonstrates JD’s ability to provide advanced supply chain and logistics services at all times to its customers but also reflects its business philosophy for long-term and “win-win” growth with its upstream and downstream partners.

Earlier this year, JD provided a number of supportive measures to its brand partners and merchants, as well as to offline small businesses to help them recover from the epidemic. In the first nine months of 2020, there were 2,004 brand partners on JD’s platform achieving over RMB 100 million yuan in sales. During this year’s Singles Day Grand Promotion, 13,532 key brands increased their sales growth by over 300%, and the transaction growth rate of third-party merchants on JD doubled, comparing with the same period last year, far exceeding the industry average.

On the employee side, as of September 30th, the overall employee number of JD.com surpassed 320,000. According to the earnings report, the number of employees for listed JD branches excluding part-time staff and interns reached 284,000.

During the first three quarters this year, JD has recruited 60,000 new employees despite COVID-19 pressure to ensure service quality and user experience and to support employment. Beyond that, it is estimated that JD’s growth has also helped to create over 18 million job opportunities in its business ecosystem during this period.

 

(vivian.yang@jd.com)