Other supplies and 200,000 RMB worth of masks in an hour

JD Deploys Asia’s First Integrated Smart and Flexible Production Logistics Park in Tianjin

Posted on Jun 17, 2020Oct 31, 2022 by Ling Cao

by Ling Cao

On June 16, JD announced the deployment of a fully-integrated Beidou Smart and Flexible Production Logistics Park in Tianjin’s Wuqing District, which is the first of its kind in Asia, and all R&D is developed in-house by JD.

The warehouse is most suitable for fulfilling and managing orders spanning multiple categories at a large scale.

Zhenhui Wang, CEO of JD Logistics said, “Leveraging our experience in smart technology innovation and application in various scenarios, JD Logistics has built an integrated supply chain technology platform covering underlying technology, software and hardware systems, as well as smart supply chain, which can be opened to other partners as basic building blocks.”

Video download link: https://jdcorporateblog.com/wp-content/uploads/2020/06/JD-Deploys-Asia%E2%80%99s-First-Integrated-Smart-and-Flexible-Production-Logistics-Park-in-Tianijn.mp4

The key characteristic of this warehouse is its brand new operation processes and management infrastructure, achieving full cycle intelligent self-status recognition, automatic diagnosis and dynamic optimization. Based on IoT and AI, it deeply integrates cutting-edge technologies: deep learning, big data, operational research, machine vision recognition and digital twin models, enabling it to be able to deal with millions of SKUs, high concurrency throughput and high flexibility to process peak time volume and optimize resource usage, covering hundreds of categories including electronics, apparel, baby and maternal, cosmetics, and food In addition, the model has high replicability and low investment costs, and JD is willing to open the core technology to merchants, extending its value to the rest of the industry.

Kun Wang, head of JD’s BeiDou Smart Flow-picking Innovation Warehouse said, “If a large enterprise can use our model and put it into large scale operation, it will save them tens of millions of RMB each year.”

Unlike a traditional warehouse which picks goods based on orders, the new warehouse use the industry-leading flow-picking model, which picks goods based on products, and changes manual static picking tasks into fully automatic dynamic tasks. In this way, it maximizes the number of items picked on a single trip, thus increasing picking density, shortening the walking distance of warehouse workers, reducing the number of picking trips, and eventually improving picking efficiency and reduce labor intensity.

Behind the scenes, this seemingly simple picking process is powered by a complex and automatic production and operations management system. Through writing 12.6 million lines of code, JD has redeveloped the warehouse management system in this warehouse so that people, goods and scenarios can be managed through a single, core system.

As for hardware, the warehouse consists of tens of thousands of components, including chips, sensors, cameras, barcode readers, and smart sorting system, and its operations are fully supported by IoT. All of the products, containers and the sorting system operate based on instructions from the core system.

Instructed by the core system, 800 smart sorting trolleys on a sorting rail can do dynamic route planning with 99.99% accuracy. With this new innovation, customers around the Beijing-Tianjin-Hebei region can enjoy the benefits of having orders fulfilled 2-3 hours faster than previously.

The new warehouse also changed the traditional operation management model which is mainly managed by manpower, to a new automatic and flexible model. It can achieve real-time operation status perception for the warehouse, real-time labor and hardware resource allocation, and real-time risk forecast and contingency plan creation.

For example, it can determine how many workers and devices are needed in certain time period, accurate to an hour, even for a dynamic efficiency adjustment. Especially during peak times like 618, it can recommend several coping plans to ensure stability. In addition, leveraging smart algorithms, the new warehouse can continuously self-learn and self-optimize, improving operation and management capabilities over time.

JD Logistics manages tens of millions of SKUs (Stock Keeping Units) in its warehouses, covering almost all categories in the retail industry and maintained an inventory turnover rate that is higher than the industry average, all attributed to the continuous development of smart and digitized infrastructure.

(ling.cao@jd.com)

Carol Fung: JD FMCG Omnichannel’s Role in Helping Customers “Eat, Drink & Live” Better

Posted on Jun 17, 2020Sep 8, 2022 by Ella Kidron

by Ella Kidron

On June 12^th at an event held in JD.com’s Beijing headquarters, Carol Fung, President of FMCG and Omnichannel, dubbed JD’s ‘Queen of FMCG’ gave a group of reporters an update on JD’s 618 Grand Promotion thus far as well as long-term priorities for the JD FMCG Omnichannel business.

Even in post-COVID lockdown China, paper products are still surprisingly still in high demand. Fung mentioned that every year, the team identifies products in some categories and sets a sales target of RMB 20 million per day. One of those products is a bag of tissues that Fung’s team shipped over 500,000 boxes of on a single day.

Another trend of this 618 that hasn’t been seen in previous years – a spike in demand for seasoning. COVID-19 is said to have boosted the “kitchen economy” in China, with demand for kitchen supplies and ingredients reaching new highs. Fung explains, “Previously, people might buy seasoning a bottle at a time, but now they are buying in much larger quantities.”

At the same time, premiumization is an ongoing trend. Fung puts it quite simply, “People want to eat better, drink better and live better.” While every category is a bit different, Fung cites rice as an example of this premiumization trend. The lowest price of rice is RMB 4 yuan per kg, however premium rice from Wuchang in Heilongjiang province is RMB 16 on average per kg, while organic rice can reach RMB 24 per kg. The demand for premium rice has brought the average overall price of rice sold on JD up to RMB 8 per kg.

Fresh products got off to a good start on June 1^st with durian, beef and chicken all performing particularly well, and Fung expects that trend to continue through the rest of the Grand Promotion. She explained that after seeing the booming sales of fresh food in the first quarter as a result of many people turning to online for their produce with wet markets closed, the team wondered if this trend would continue or if demand would normalize. However, because of continued rapid growth of new customers in fresh and frozen of over 100%, sales have continued to grow by over 100%. Fung expects at least high double-digit growth for the long run in the category. She explains, “We will expand our cold chain logistics network to continue to support this business. More and more customers shop with us, and we need to provide the best service to them.” Cold chain logistics is one of JD’s six major logistics networks and an essential component of its fresh and frozen strategy.

This 618 has also seen a rebound in liquor and hair care products after demand was temporarily suppressed by the epidemic. Liquor is heavily reliant on offline scenarios, but Fung’s team introduced online clubbing, an innovative way to keep people entertained in lockdown and to introduce and promote liquor sales. Now the liquor category is back in force, but livestreams remain an important part of the FMCG business.

During this year’s 618, FMCG will do nearly 70,000 livestreams. JD previously announced it would do over 300,000 livestreams this Grand Promotion, and the contribution from Fung’s team makes up at least 30%. “Livestreaming is a hot trend right now. Each of our categories has its own characteristics, and many have celebrity endorsements, so we invite the celebrities to do livestreaming with us”. One livestream with well-known Chinese actor and entertainer Wang Yibo on JD helped Ariel (碧浪) drive a record number of unique visitors and daily sales. She explains the livestreaming is not just as a means to attract customers, but also a key tool to provide valuable insights to the brands so that they can continue to improve their retention rate and reach consumers with more precision.

One of Fung’s long-term priorities is customer management. She explains that it is important for JD to grow with its customers and meet their demands precisely at different stages in the consumer lifecycle. This conscious effort to invest in the customer is clearly paying off – the FMCG categories have the highest repeat rate among all categories on JD. Fung can’t help but hide her excitement, “In my business group, there is not a single category that is not performing well.” Fung’s FMCG business is a key driver of future growth for JD.

As for what’s next for Fung and the team once 618 wraps up, two words come to mind: Omnichannel Marketing. She explains that while there is typically a slowdown in July after the sale wraps up, this year, in order to help manufacturers make up losses from the first quarter, JD FMCG Omnichannel will invest more in omnichannel marketing campaigns. She adds, “More important is a focus on the user, our customers.” Omnichannel marketing is yet another way to recruit, engage and retain customers. Two projects on the horizon in this area involve Chinese dairy leader Mengniu as well as P&G, one of the many top international brands Fung’s team sells, but it is too early to share details.

(ella@jd.com)

JD and Leading Retail Research Firm IGD Release Report on JD’s Autonomous Warehousing

Posted on Jun 17, 2020Nov 8, 2021 by Ella Kidron

by Ella Kidron

On June 16^th , JD and leading research firm, IGD, released a collaborative research report on JD’s autonomous warehousing. The report, “Demystifying JD.com’s Autonomous Warehouse” provides an overview of JD’s autonomous warehousing technology, its processes, proprietary software, the role of 5G and sustainability initiatives. In particular, it provides a spotlight on JD’s Asia No. 1 logistics park in Dongguan, Guangdong province (Read my colleague’s in-depth on this here)– the largest autonomous warehouse in Asia. JD’s Dongguan logistics park covers an area of 500,000 square meters and has 78 automatic stackers with a combined height of over 1,600 meters. It is able to handle 1.6 million orders per day.

During the height of COVID-19, JD’s autonomous warehousing capabilities and other smart logistics were essential in ensuring sufficient supply. Advanced algorithms capable of new route planning, vehicle usage optimization, and inventory forecasting, which are regularly used in JD’s operations, were key to this effort. From January 20^th to February 13^th , JD supplied 71,500 tons of rice, flour and grain, 27.25 million liters of cooking oil, 40 million bags of instant noodles, 50,000 tons of fresh produce, 3 million cans of baby formula, and 3.61 million bottles of disinfectant, among other products.

The report also looks at the important role of 5G in the future of logistics, especially in the realm of industrial Internet of Things (IIoT). JD unveiled the world’s first 5G-powered smart logistics park in Beijing in October 2019.

The full report can be downloaded from IGD at the following links:

For non-subscribers to IGD: https://bit.ly/3e9It39
For subscribers to IGD: https://bit.ly/2Y9GZAF

A more substantive summary of the report from IGD is available here: https://bit.ly/2AJUcan.

(ella@jd.com)

JD.com Launches “Bathroom Revolution” during 618

Posted on Jun 16, 2020Nov 29, 2022 by Vivian Yang

by Vivian Yang

Do you know that the average person spends over 30,000 hours in the bathroom in their lifetime? That almost 4 years in total! People in modern times would agree that the quality of one’s bathroom reflects one’s quality of life. According to JD’s recent survey, 63% of people take their bathroom as a space to relax and recharge themselves; 60% believe that the bathroom represents the owner’s personality and quality of life; while 32% are not satisfied with the current style and equipment of their bathrooms.”

As a result, creating more humanized, personalized, intelligent and quality bathrooms have become the four emerging trends in the home furnishing market.

During this year’s 618 Grand Promotion, JD Home launched the “Bathroom Revolution”, an initiative that mobilizes all parties and brands of the supply chain from interior design, decoration, construction materials to furnishing, to provide plenty of product choices and services, and a one-stop home furnishing solution for customers who want to upgrade their homes, especially their bathrooms, this summer.

Over 1,000 independent interior designers have participated in this initiative and shared their works on JD’s platform, showcasing their creativity in space utilization as well as care reflected in bathroom design.

“For a long time, interior designers accumulated many good ideas for bathroom decoration, but it is difficult to realize them due to the lack of brands’ support. Thanks to JD’s initiative this time, our designers’ feedback can be integrated into the R&D and sales process of decoration products, which will generate far-reaching impact in this industry,” said Wei Wu, one of the interior designer in this initiative.

Bathroom design examples by interior designers on JD.com

In addition to presenting over 1,000 examples of interior design suggestions, JD Home also collaborated with hundreds of well-known home decoration companies to offer construction plans. For example, JD and B&Q jointly offered bathroom renovation packages that include construction materials of selected international brands as well as products with standardized quality guarantees – a super easy home renovation solution that can spare customers from running around to purchase and select decoration materials as they had to do in the past.

At the same time, over 1,000 stores of 100 brands in bathroom, kitchen, and lighting products on JD Home have made a “Five Zeros” service promise, which includes free-of-charge on delivery and installation of new products; free-of-charge disassembling of old products; free testing and defect checking service for products purchased within 1 year and free maintenance service during the 3-year warranty period that covers all the products by different brands in the initiative.

A number of international and domestic brands introduced their cutting-edge products at competitive prices during 618. Sanitary ware brands include American Standard, GROHE, INAX, Roca, TOTO, Kohler, and Panasonic; Paint brands include Dulux, Nippon, and Davco; Lighting brands include NVC, Opple, Philips; and Smart electrics brands include Schneider, Delixi, and Chint.

With designers and brands ‘participation, JD Home also leverages AR technology to enhance the shopping experience – customers can use the real-time smart interior design software on JD.com to interact with designers and “move” their selected products into their virtual home spaces to find the best fit. This is helpful for customers to enjoy a complete home furnishing service from decoration consulting to product purchase.

(vivian.yang@jd.com)

JD Adds Air Cargo Route during 618

Posted on Jun 16, 2020Sep 6, 2022 by Ling Cao

by Ling Cao

On June 16^th, JD launched a dedicated freight Boeing 737-300F, from Tianjin to Wuxi, Jiangsu province. The first flight on this route follows an announcement about a route from Shenzhen to Wuxi. With the new project, JD can connect China’s three economic areas on air cargo flights among Beijing, Tianjin and Hebei, the Yangtze River Delta and the Great Bay Area of Guangdong, Hong Kong and Macao, accelerating the deliveries to customers there, as well as expanding air cargo service to lower tier markets.

For example, one parcel sent from Beijing in the afternoon can reach Zhongshan, Gunagdong province in the morning the next day, improving fulfillment speed by more than 24 hours. The air transportation connected by the three regions can narrow the time of each fulfillment process, and can provide more flexibility for merchants to schedule their transportation. The new flight is also part of a cooperation between JD and Zhejiang Loong Airlines, and has 130 cubic meters of space per cargo flight.

Air cargo supply has been impacted by the epidemic since January, while since May, civil aviation has gradually resumed normal operations in China, with 228,000 tons of materials transported by all-cargo aircraft in May, an increase of 21.8% YOY.

Jun Fan, head of JD Express at JD Logistics said at the launching ceremony, “JD has continuously built its air cargo network in order to provide a superior, fast, accurate and stable delivery experience for customers and merchants. The new aircraft can ensure a more diverse services in our transportation network.”

JD has partnered with industry leading air cargo companies, such as China Southern Airlines, Air China Cargo, and China Eastern Airlines Logistics, with more than 37,000 air routes between cities, air delivery services can be operated in 157 cities.

(ling.cao@jd.com)

Lijun Xin Combines His First Livestream Show with a Plank Competition

Posted on Jun 15, 2020Nov 3, 2022 by Tracy Yang

by Tracy Yang

On June 10^th, Lijun Xin, CEO of JD Health participated in a livestream show for the first time, along with executives from nutrition and health brands, including GNC, Swisse, and Nestlé, which drew attention of 3.18 million viewers.

In addition to recommending good nutrition and health care products, Xin also challenged other brand executives to a plank competition to promote a healthy lifestyle. Xin said: “Our brand partners are very supportive by offering high-quality products to consumers. I hope we will continue to strengthen cooperation, convey the concept of a healthy life and bring consumers high-quality products at competitive prices during JD’s June 18 Grand Promotion. ”

With the rise of national health awareness in the post-epidemic era, the focus of national health care has changed from “treatment” to “prevention”, and nutrition and health products have naturally become the best choice for consumers. At the beginning of JD’s June 18 Grand Promotion（618） this year, the performance of healthcare products sold on JD Health was impressive.

Data shows that from June 1^st to June 9^th, sales of cross-border imported nutrition and health care products increased by more than 100% compared with the same period last year. A number of nutrition and health care subcategories also staged strong performance. Sales of probiotics increased by 240% compared with the same period last year. Sales of products that can prevent hypertension, hyperglycemia, and hyperlipidemia increased by 140%. Sales of products that can nourish and protect the liver increased by 130% over the same period last year.

JD’s June 618 is the shopping festival with the largest discounts, the best shopping experience, the strongest growth of brands and merchants and the largest number of new products. JD Health has worked with 2,500 health and nutrition merchants to offer more than 3 million units of health products, meeting the various demands for health, covering beauty, weight loss, bone health, immunity enhancing, sports nutrition and more. JD Health also launched online consultation services with nutritionists and dieticians to help users improve their health management capabilities and enjoy a healthy and happy life.

(tracy.yang@jd.com)

Changes in Consumption from COVID-19 Outbreak to Today

Posted on Jun 15, 2020Aug 31, 2022 by Vivian Yang

by Fei Lu and Vivian Yang

With the development of the COVID-19 in the first half year of 2020, Chinese consumers’ shopping behaviors have been affected and even transformed. The consumption trends can be categorized into four stages. We have identified some major ones in each stage based on the big data of JD.com.

1. During COVID-19：January – February 2020

Shift to online shopping: High-frequency shopping online (5-8 times/month) increased by more than 50%;
Changes on categories: Demand grew fast in home care, maternal and child, health, pets, household appliances, entertainment and other “off-season” categories;

Growth in Certain Consumer Groups: orders from female new users between the ages of 46-55 grew 38%, that of over 56 females grew 54% year-on-year. Consumers under 25 were showing a growing sense of family responsibility, buying for others rather than just for themselves.This consumer cohort experienced the most rapid growth in the purchase of meat, eggs and fruits and vegetables.

2. Resumption to Work: March –April 2020

From WFH to Office: Resumption of work gradually started with telecommuting. As a result, the transaction amount of audio-video-related equipment (headphones, microphones, etc.) for conferences increased by nearly 20 times year-on-year; As people prepared to return to the office starting in March, related products such as office supplies, shoes, and raincoats increased by 57% month-on-month;
Surge of New Products Launches: New releases on JD in Q1 2020 are close to 50% of the 2019 total. New products that represent new technologies, new designs, new functions, new experiences and better profits will give brands an early start in the industry. More than 90% of the core brands select JD supermarket as the first platform for new products.

3. “May” be getting better: national holiday from 1^st – 5^th May

With the improved weather improving and loosened travel restrictions, consumption boomed. Especially because door to door delivery became possible, large appliances purchases began to bounce back. During the May-Day holiday, online consumption turnover increased by 45 percent compared with the same period in 2019.

4. Mid-Year Shopping Festival – new trends found during 618

Continued consumption upgrade: According to KPMG’s latest report on May 28^th, with the sustained economic recovery and resumption of work and production, the general trend of consumption expansion and structural upgrade has remained unchanged.
Revenge consumption; Livelihood demand strongest: Over 40 brands sold over RMB 100 million yuan on June 1st, indicating comprehensive recovery and a sharp rebound in some categories.
Online shopping behavior persists: in face of the epidemic’s uncertainty and driven by the 618 Grand Promotion, e-commerce platforms like JD.com continue to integrate with short video platforms, offline stores, and city consumption stimulus plans keeping consumers active online.

(Fei Lu is senior analyst of JD Big Data Research Institute)

(vivian.yang@jd.com)

JD.com and Kuaishou Roll out E-commerce Livestreaming Partnership

Posted on Jun 15, 2020Nov 17, 2022 by Yuchuan Wang

by Yuchuan Wang

Today, JD.com and Kuaishou, China’s leading video sharing and livestreaming platform, announced to officially kick off the two parties’ strategic partnership to launch the first big promotion event on Kuaishou on June 16^th, when celebrities and over 100 well-known Kuaishou KOLs will promote the quality products via livestreams.

As a part of JD’s 618 initiatives, on May 27^th, JD and Kuaishou signed a strategic partnership with a focus on supply chain. Kuaishou users will be able to purchase products provided by JD without leaving the Kuaishou app, and enjoy fast delivery and after-sales service provided by JD.

For the first promotion, JD will provide 100,000 iPhone 11s, 100,000 iPads, 20,000 bottles of Moutai, 20,000 Nintendo Switches, 20,000 Estee Lauder essence, 50,000 M.A.C lipsticks, among other products, with big discounts. Apart from celebrities and KOLs, all anchors on Kuaishou are able to sell the products in their livestreams and short videos.

The June 16^th promotion marks the start of ongoing promotions through the partnership in the future. The two parties are keen to develop a healthy, open and sustainable e-commerce livestreaming ecosystem to satisfy diversified consumer needs.

(yuchuan.wang@jd.com)