by Rachel Liu

Walmart, JD and Tencent announced that the 8.8 (August 8^th) Omnichannel Shopping Festival (July 16^th to August 15^th), jointly launched by the three companies, has seen double-digits y-o-y sales increases in its “on-demand” business. On the day, the average number of “on-demand” orders of each Walmart store surpassed 1,000.

The Walmart stores on JD also saw great performance. Sales of Walmart’s flagship store on JD increased 180% y-o-y on July 16^th, the first day of the 8.8 Shopping Festival. Sales of personal care, wine, and maternal & baby products all achieved double digits’ increases. Sales of food and beverage products through Walmart cross-border flagship store on JD Worldwide increased over 260% y-o-y. Walmart flagship store members increased by 650,000 during the shopping festival, and followers of the store has now reached nearly 10 million.

This year, with the impact of COVID-19, customers’ demand for online shopping and on-demand delivery is growing. JD and Walmart have worked together to launch an on-demand delivery service to provide next-day delivery to the customers who shop from the Walmart flagship store on JD, aiming to improve customer experience and optimize supply chain efficiency. If customers order products via the online flagship store, and the products are available in a nearby Walmart store, the order will be sourced from the store, and delivered directly to the customer, rather than having to come from a warehouse.  During the 8.8 shopping festival, the service covered 83 cities around China.

Since forming a strategic partnership in 2016, JD and Walmart have been exploring omnichannel development. In 2017, the two sides initiated the 8.8 shopping festival, and successfully integrated online and offline users, and piloted an inventory integration project in Shenzhen.

Customers are also able to shop on the Walmart WeChat mini-program powered by Tencent. There are over 7 million registered users on the mini-program, which ranks No.1 in the retail industry. It’s also the fastest growing mini-program on WeChat.

 

(liuchang61@jd.com)

by Martin Li

JD.com plans to open 20 JD E-Space experience stores in first tier cities by 2025, Yan Xiaobing, Senior Vice President of JD.com and President of JD Electronics and Home Appliance, announced at the press conference on Aug.12^th.

The press conference was held to mark JD’s official ownership of home appliance chain store 5Star. JD completed the acquisition of the remaining 54% of equity in 5STAR.combining with the previous 46% stake, this acquisition makes 5Star a wholly-owned subsidiary of JD.com.

“JD will also open 300 home appliance flagship stores in second and third tier cities on a one-city-one-store basis and 5,000 stores in towns and villages by 2025,” said Yan.

“All of these new stores, combined with the existing 15,000 JD Home Appliance Stores, will create a new offline JD (in terms of electronics and home appliance business),” he added. The 15,000 stores have covered 25,000 townships and 600,000 villages.

Yan Xiaobing speaks at the ceremony on Aug.12th.

The 20 new E-Space stores will be 50,000 and 100,000 square meters in size. JD’s E-Space, which made its debut on Singles Day (November 11^th) 2019 in Chongqing, enables consumers to try virtually anything within the store, and provides experiences from driving go-karts, to taking baking classes and even taking washing machines for a spin with real clothes.

Each of the 300 offline home appliance stores will be 10,000 to 20,000 square meters in size. These stores are expected to complete the offline network of JD’s direct-to-consumer home appliance business.

The acquisition of the remaining shares of 5Star is expected to further optimize JD’s electronics and home appliances supply chain, and improve its omnichannel capabilities.

5Star will be renamed JD 5STAR Group Limited and maintain independent operation.

5Star’s subsidiary stores will gradually carry the new name and undergo digital upgrade to function as product demonstration, customer experience and membership service centers.

5Star was established in 1998 and has annual sales over RMB 18 billion yuan. It is the third largest home appliance chain-store in China, only after Suning and Gome. The company owns more than 1,000 stores.

All 5Star stores have primarily achieved integration of offline and online products. 40% of the sales at stores come from online traffic, according to Pan Yiqing, president of the new company.

JD led in omnichannel sales of home appliances in China in the first half of this year, according to the report by China Electronics and Information Industry Development Research Institute.

“The COVID-19 pandemic took its toll on the home appliance industry in the first of this year. JD’s acquisition of 5Star could play a key role in driving the industry’s transformation,” said Jiang Feng, director of China Household Electrical Appliances Association.

 

(bjlihao3@jd.com)

 

by Vivian Yang

ExxonMobil held its “Super Brand Day” on JD.com on August 11^th, during which the famous lubricant brand introduced several engine oil products that meet the China VI emission standard as well as rich marketing activities to ignite people’s passion for driving in this summer.

The China VI emission standard (国六) is a new national standard aimed at dramatically cutting emissions from the country’s vehicles of all types. It is one of the world’s most stringent emission standards. Due to the outbreak of COVID-19, the new standard has been postponed to take effect nationwide beginning in January 2021.

In the face of the upcoming standard upgrade, the automotive industry is gearing up with more complicated engineering and higher engine performance. This makes the protective effect of lubricant on the engine all the more important. For this reason, ExxonMobil launched a product line for Chinese car owners that meets API SP standards, which is the newest API (American Petroleum Institute) gasoline-engine oil standard. These products have been improved in many aspects, such as low-speed early combustion, high-temperature viscosity thickening control, fuel economy, cleaning performance, wear-resistance and more. The SP standard engine oil is compatible with all car models meeting the China VI standard and below.

The automotive aftermarket is also actively preparing for the arrival of the new standard.  Based on JD’s “Product+Service” model, customers buying ExxonMobil lubricant products via JD’s first-party online store can enjoy seamless maintenance services offered by JD Auto Service, the offline car service chain stores.

On the “Super Brand Day”, in addition to the livestreaming, gaming and substantial sales promotions, the brand also invited CBA stars to share useful knowledge about car maintenance and environmentally-friendly lifestyles.

The event is one of the milestones under the cooperation between JD Auto and ExxonMobil. The two sides announced a strategic cooperation in Shanghai in May to fully integrate in the areas of products, services, marketing, and membership and create a new format of car maintenance and service in the digital era so as to comprehensively enhance consumers’ experience.

 

(vivian.yang@jd.com)

by Yuchuan Wang

On August 11^th, JD.com officially completed its investment in China’s fourth largest convenience store chain, Xiamen Fook Chain Store Management Limited Company (Fook Convenience Store), representing JD.com’s first investment in the chain convenience store industry.

Fujian province-based Fook Convenience Store was established in 2006. It currently operates 1,700 convenience store outlets. Thanks to industry-leading warehousing and supply chain abilities, the company has established its own self-built fresh food factories and logistics centers.

Leveraging the investment in Fook, JD will further expand the omnichannel strategy for its supermarket business. Fook will supplement JD.com’s online retail business, improve last-mile delivery, and increase user loyalty. The two parties will explore “e-commerce + convenience store” model initiatives, such as social group buying, O2O, omnichannel fulfillment and more.

JD.com is already the largest retailer of many well-known international FMCG brands including P&G, Unilever, Nestlé, Mars, Wyeth and more. Its business covers 1 million offline stores. The company has partnered with more than half of the country’s top 100 chain supermarkets in more than 200 cities.

“JD.com will leverage its strong capabilities in supply chain, data, technology and marketing to promote the branding, chain development and intelligent nature of convenience stores, to better serve consumers and facilitate consumption growth,” said a JD representative.

Since 2019, JD.com has completed a series of investments in market leaders such as 5Star, Gome and D.Phone in the electronics and home appliances industries. Ahead of this year’s 618 Grand Promotion, JD also partnered with Kuaishou to provide its supply chain abilities to the leading live streaming platform.

 

(yuchuan.wang@jd.com)

by Rachel Liu

On August 10^th, JD and Gome jointly initiated a purchase plan worth from brands RMB 30 billion yuan, including products such as televisions, refrigerators, washing machines, air conditioners, small home appliances and electronic products. The products will be sold via Gome, JD’s first-party stores, and the Gome flagship store on JD. This is the largest purchase of home appliances and electronics products in China this year. The joint purchase will not only provide more high-quality products to customers, but also drive domestic demand and help combat influences of COVID-19.

The two sides plan to purchase 2.1 million televisions, mainly OLED, laser and 8K models; 2 million refrigerators and washing machines; 3.6 million air conditioners;1 million dishwashers and kitchen appliances; 10 million small home appliances from brands including Midea, Joyyoung and Dyson; and 1 million mobile phones from Apple, Huawei, Honor and Xiaomi. The two sides will also purchase a total of 785,000 laptops, desktops, smart wearables, cameras, and entertainment equipment.

Junzhou Wang, CEO of Gome Retail said:” The joint purchase plan by JD and Gome is an update on the previous cooperation. We hope to bring more high quality products and a better shopping experience to customers through the integration of our supply chain, traffic and premium customer service.”

Xiaobing Yan, president of JD Electronics and Home Appliancse said: “JD and Gome have always strived to provide benefits to customers and our brand partners. Although COVID-19 has significantly impacted the home appliances industry, we also see opportunities in the challenge. The joint purchase plan will improve the efficiency of retail and supply chain, and optimize the shopping experience for customers.”

An industry report shows that home appliances sales in the first half of 2020 were RMB 369 billion yuan, a decrease of 14.13% y-o-y. JD and Gome are two of the biggest players in the industry with an over one-third market share in total. The joint purchase plan will help stabilize the market and drive the recovery of the home appliances industry.

The purchase marks a deeper cooperation following the establishment of Gome and JD’s strategic partnership. Gome launched a third-party flagship store on JD this March. On May 28^th, JD announced a strategic partnership with Gome Retail focused on product purchase and sale, logistics, financial services, and more. JD will also buy $100 million worth of convertible bonds from Gome. In July, the Gome app launched nearly 20,000 SKUs of first party consumer goods from JD Super, JD’s online supermarket.

 

(liuchang61@jd.com)

by Yuchuan Wang

JD MRO, JD.com’s B2B subsidiary for industrial maintenance, repair and operations (MRO) products and services, announced today it has completed the acquisition of VIPMRO, China’s leading procurement platform for MRO products. The acquisition gives JD access to VIPMRO’s over 100,000 offline retail stores.

MRO business covers over 10 million SKUs, many of which are long-tail and non-standard items. Through the strategic investment in VIPMRO, JD is able to speed up its development in the MRO industry while satisfying increasing demands from clients.

VIPMRO will be positioned as a sub-brand of JD MRO and provide its services to offline retail stores. Connecting with manufacturers will help JD build an even more comprehensive and smarter supply chain for MRO products.

In addition, through “Partner Store” plan, JD MRO will provide digital solutions for offline stores in the areas of product selection, transportation and delivery, installation and more, to improve their operations efficiency.

Chunzheng Song, vice president of JD.com and president of JD Business said, “The acquisition of VIPMRO and the launch of Partner Store plan are only parts of JD’s investment in MRO industry. JD Business will further integrate resources in the market related with procurement and provide valuable long-chain services to enterprise clients.”

 

(yuchuan.wang@jd.com)