by Ling Cao

JD has opened the doors of its first home appliance flagship store in Bengbu, a fourth-tier city in Anhui province, a move that is in line with JD’s strategy to open 300 home appliance flagship stores in prefectural-level cities on a one-city-one-store basis by 2025. Sales in the store reached RMB 45 million yuan between August 28^th to September 14^th, making it the city’s most popular home appliance and electronics shopping place.

Unlike traditional home appliance stores, JD’s new store in Bengbu aims to go beyond retail. The store will also include entertainment zones for testing the store’s products through activities like cooking, driving go-karts, piloting a drone to take photos, and more.

“We’re trying to create a relaxed environment that encourages customers to try things out and enjoy themselves in the process of finding products that meet their needs, instead of purchasing only based on a dry recommendation from a salesperson,” said Naiqing Tong, head of the Bengbu store.

The test-before-purchase concept is consistent with the consumption philosophy of younger generations today, and has resulted in a customer base of mostly people in their 20s, Tong said.

In addition to a unique experience, the store also offers reasonably priced products ranging from high-end home appliances, to more affordable options including refrigerators and washing machines under RMB 1,000 yuan, and more.

Ms. Chang, a customer at the store, told store manager, “I saved several thousand yuan recently on a purchase of home appliance sets totaling around RMB 40,000 yuan. I got big discounts, and colorful products!”

JD provides full refunds within 7 days, or within 30 days for valid complaints, ensuring a best-in-class customer experience.

(ling.cao@jd.com)

by Ella Kidron

JD.com attended an online panel during the Global Retail Show, a large retail event heavily attended by Brazilian executives, to discuss China retail trends and provide practical case studies from JD’s business.

The Global Retail Show aims to promote the debate between players and peers in the retail space throughout their experiences, strategies and ideas. The event, held from September 13-19, promotes a total of 150 hours of content, with curators from 12 countries inviting leaders of different segments, resulting in a team of 267 speakers. It is usually held in Brazil but under COVID-19 was held entirely online this year.

The panel was organized by top Brazilian business school Fundação Dom Cabra (FDC) and Cheung Kong Graduate School of Business (CKGSB). Rodrigo Zeidan, Associate Professor of Practice of Business and Finance at NYU Shanghai and Visiting Professor at FDC, as well as Dr. Yang Li, Associate Professor of Marketing at CKGSB. Mary Wadsworth Darby, Chief Representative of CKGSB Americas, moderated the discussion.

As the only representative from a retailer on the panel, JD’s presentation focused on how innovations in retail are applied throughout the business to improve the customer experience and help brand partners and merchants in the market. The sharing focused on four areas, omnichannel, customization, consumption of services and interactive forms of consumption such as AR/VR and livestreaming.

In omnichannel, the emphasis was on providing a consistent shopping experience across different shopping formats and giving brands and merchants insights into how their consumers behave offline, as well as online, while the section on customization focused on how matching supply and demand from the consumption and production ends can ensure more satisfaction throughout the entire retail process. The trends shared can be summarized in a few words – consistency of experience, customization and interactivity.

Slide from JD.com’s panel discussion sharing

Rodrigo Zeidan opened the discussion with an overview of China’s economy. “We overestimate China in the short run and underestimate it in the long run.” He added: “Everyone is enamored by the scale and size of China,” referring to the double digit growth of the last 40 years. “But they underestimate China in the long run… the success of China is going to be earth shattering 20 years from now, much more than it is today.” He went on to explain that the total GDP per employed person in China is now 20% of that of the U.S., but if we assume 5.5% growth for the next 30 years, while the American economy grows at 2.5% per year, labor productivity of China could hit U.S. levels in 2048. “The Chinese economy has so much space to grow…The retail sector is going to explode – it’s already doing that”

Yang Li used the different components Chinese translation of the word “internet”, hulianwang (互联网) to explain the current trends in today’s internet: Connectivity (lian 联), Network (wang 网) and Social (互). In terms of connectivity, Li focused on lowering the cost of connectivity, doing between e-commerce and online advertising and online-to-offline integration. As for network, he explained that today’s network is very diverse. Many people are connected and control their own usage of the Internet and their time. This is one of the reasons that information can go viral. Li also explained how the internet celebrity trend has also emerged from this network diversity.

Finally, in sociability, Li referred to how the social networks built by WeChat and other players is “smaller, but more genuine”. The trust of the social network has also played an integral role in some aspects of e-commerce. He mentioned how Tencent makes money not on WeChat, as Facebook would through advertising, but rather through the programs built on WeChat. He referenced JD.com as one of the mini-programs accessible through WeChat thanks to JD’s strategic partnership with Tencent.

The Global Retail Show panel hosted by FDC and CKGSB, attended by JD.com and CKGSB speakers

(ella@jd.com)

by Martin Li

As a result of the new cooperation, leading UK organic baby food brand Little Freddie forecasts 60% growth on the e-commerce platform, JD.com.

On September 12^th, Little Freddie and JD entered into a cooperation agreement with a view to leveraging their respective strengths to accelerate the growth of premium complementary baby foods and to increase Little Freddie’s category penetration on JD.com.

“JD has always paid high attention on the quality of products, which is also a high priority for Little Freddie,” said Jiang Longwu, general manager of JD’s mother and baby product procurement department. “We hope Little Freddie makes full use of its strength to build up its connection with customers by articulating its brand story regarding high quality raw materials, nutritious recipes, world class technical standards and fully traceable product safety.”

Taslim Ho, Little Freddie founder, stated that Little Freddie will continue to invest on JD.com as there remains so much untapped potential given low penetration rates vs. more developed Western markets.

“JD will become an even more important partner to Little Freddie,” she said. “In 2021, we will focus on expanding our market size and continue working together with JD to enhance the consumer offering.”

According to JD.com’s data analysis, complementary baby food is the fastest growing category in the mother and baby products market and customers tend to prefer premium, imported and organic brands.

China’s complementary baby food market increased from RMB 10 billion yuan in 2012 to RMB 40 billion yuan in 2019 with an average 10% growth rate, according to a domestic industry report.

(bjlihao3@jd.com)

by Martin Li

JD MRO, JD.com’s B2B subsidiary for industrial maintenance, repair and operations (MRO) products and services, announced a series of new initiatives today at the ongoing 22nd China International Industry Fair (CIIF) in Shanghai, including an app for procurement of industrial products.

The app is named after VIPMRO, which was acquired by JD MRO earlier this year. It’s aimed at providing a factory-to-business procurement platform, and is expected to connect more than 10,000 quality factories and 100 industrial areas.

JD MRO’s exhibits at the 22nd China International Industry Fair (CIIF) in Shanghai

JD MRO also unveiled a program to connect offline stores with brands by JD’s digital solution, through which brands can deliver products directly to offline stores while providing related services. JD MRO will provide customized solutions to help offline stores go digital.

“JD MRO is dedicated to building a digitalized ecosystem of industrial products by completing industry infrastructure, connecting industry chain dots by digital means and building an integrated professional service system,” said Chunzheng Song, vice president of JD.com and president of JD Business, at today’s launch ceremony.

Standardization is one of those infrastructures, Song noted. Industrial products have complex categories without universal standards, which makes it hard for buyers to find what they need based on product references. Take screw nuts as an example: there are several standards including GB in China, DIN in Germany, JIS in Japan and ASTM in the United States.

In an effort to address this problem, JD MRO also launched a database of industrial product standards. This database won an information technology award at the fair.

In addition to the other initiatives, JR MRO signed a cooperation agreement today with six industrial product service providers to offer services including procurement consultation, product installment and maintenance.

“Increasing digitalization of the industry has largely changed enterprises’ way of management, production and sales,” Song said. “JD MRO will continue innovating solutions to make the industry digitalized and intelligent.”

(bjlihao3@jd.com)

by Kelly Dawson

JD.com’s more than 280,000 employees come from a wide range of backgrounds and areas of expertise. In the next installment of our JDer Lab series, we speak to another JDer about what it’s really like to work for China’s largest retailer.

“It could be [with] a new partner or a new business; it could be an existing partner and a new business. I love that kind of brainstorming and especially making that breakthrough where both sides are like, ‘Yes, we should totally do it,’” he said. “It’s just an awesome feeling.”

A second breakthrough often follows when management finally signs off and the project becomes more than an idea, he said.

Rudnicki has experienced his own share of breakthroughs in his time with JD.

After four years in Silicon Valley, Rudnicki came to China in 2017 for the Tsinghua-MIT MBA program. During that time he interned with JD as a project manager in international partnerships, eventually taking the leap to join the company full-time after graduation.

He spoke little Chinese at the time. In fact, when he and his wife first arrived in China he had about “five hours of Chinese class under my belt,” he told us. “I had just learned that there are these things called ‘tones’, which is about as rookie as it gets.”

Over time he’s leveled up his Chinese language abilities, now attending daily meetings and reporting to managers in Chinese. “I’m not really sure how it happened,” he said. “That will be something I’m proud of for the rest of my life.”

The openness and kindness of his JD coworkers have played a big role in making the process easier for him, he said. “I’ve been really impressed with how open people are, and especially coming in as a non-Chinese person in a non-Chinese company which doesn’t have many foreigners. It has been really eye-opening at how welcoming people are, and willing to forgive, whether it’s a language mistake or a cultural misunderstanding.”
Additionally, Rudnicki thinks JDers are some of the hardest working people he’s ever encountered.

“Coming from San Francisco and Silicon Valley where people work really hard, I think that there’s another level here,” he said. “It impresses me day in and day out to see the energy that people put into their work. I thought I was a hustler, and I constantly have to raise my own bar here.”

(kellydawson@jd.com)