by Ling Cao

Today, JD’s Wuhan Asia No. 1 Cargo Fleet won a major award to be given by the Chinese government in recognition of its excellence and support for the people of Wuhan. A total of 15 groups are shortlisted in the anti-epidemic group category, of which JD was the only one representing the logistics industry. The other groups were from the medical, construction industry and charity institutions.

JD’s Wuhan Asia No.1 Cargo Fleet brings together employees who were working consistently to aid the fight against COVID-19, helping to transport emergency materials to hospitals and customers in a timely manner. To date, the fleet has delivered 6,000 tons of daily necessities to over 3 million people.

On the eve of Chinese New Year, the team received an urgent request to transport materials. They took immediate action to send the first batch from Wuhan’s Asia No.1 logistics park to local hospitals – all within three hours.

Further, the entire team returned to work on January 25^th to continue providing needed support. Mingguang Yang, a young driver in his 20s’said, “We didn’t have time to think otherwise. We simply thought we could reunite with our families next year during Chinese New Year. This year, we had work to do to provide support during this exceptional period.”

 

(ling.cao@jd.com)

by Yuchuan Wang

On April 18^th, Guowei Zhang, head of JD’s live streaming business, JD Live, spoke at the social e-commerce summit jointly held online by Youzan (a Chinese merchant services company) and Ebrun (a Chinese e-commerce news portal). The following is an excerpt of Zhang’s speech, “The Turning Point of 2020 E-commerce Live Streaming”:

Guowei Zhang, head of JD Live

As a core business of JD.com in 2020, JD Live will see relatively large investment and development this year. In my opinion, the e-commerce live streaming market has just begun, and it is still in the early stages. Live streaming will be the standard configuration for online merchants and e-commerce platforms in the longer term. As for JD, our first party business model, close relationship with merchants, the high quality e-commerce experience and strength in supply chain and logistics are the prerequisites for us to leverage e-commerce live streaming.

2019 is considered to be the first year of e-commerce live streaming. By my calculations, the number of merchants doing live streaming increased at least four times while the number of MCNs* also increased over four times. Here are the reasons why the business is becoming so popular:

• First, technologies such as 5G have continued to lower the threshold for doing live streaming so that everyone can become an influencer.
• Second, merchants are equipped with private domain operation tools and channels.
• Third, e-commerce platforms are in need of new marketing scenarios and they are willing to collaborate with merchants and MCNs on live streaming.
• Forth, live streaming has brought a brand new shopping experience, from awareness (pre-purchase) to eventual purchase, especially for younger generations and consumers in lower-tier cities.

JD online clubbing

But the prosperity is also accompanied by a series of challenges, of which I have listed only four:

• First is the imbalance in development of MCNs. Resources are focused on top institutions, so it’s harder and harder for others to acquire traffic and business.
• Second is the relatively high product return rate. On the one hand, customers tend to shop impulsively watching live streaming; on the other hand, “brushing”* has made the market opaque.
• Third is that most of the live streaming sessions lack good ideas and planning, resulting in low order conversion rate. It looks like everyone can be an influencer but the actual threshold is relatively high to do e-commerce lives well.
• Forth is acquiring traffic has become more and more difficult and is a challenge that needs to be figured out by both merchants and e-commerce platforms. I’ve seen many merchants join the battlefield just because others are doing so.

I believe 2020 will be the year for the industry to reach new heights. After the initial surge in 2019, e-commerce live streaming has come to its “turning point”. There are three aspects that the industry will pay attention to: building the ecosystem, including the ecosystem for both merchants and MCNs and influencers; building the infrastructure; and generating quality content.

We will keep investing in this field, integrate JD’s internal and external, online and offline resources and develop in three directions: 1) building a scalable business; 2) building a healthy ecosystem; and 3) building a new ‘quality e-commerce live streaming’ model.

• Building a scalable business: Live streaming will become standard for JD’s brands and merchants. We are targeting 100% of JD’s 1P business and 60% of JD’s third party merchants to do live streaming this year. To achieve this goal, we have introduced a large number of resources and supportive policies, for example, commission fees will be lowered to as little as 1%, and monthly promotions will be held to attract traffic. At the same time, we will provide a large number of coupons, JD points and other subsidies.
• Building a healthy ecosystem: JD is currently optimizing the system for merchants and MCNs to solve problems related to business development, matching demand and supply, etc. For example, we will digitize every step of live streaming and open JD’s data technology to help reach targeted consumers. We will continue to research how to provide a better experience, functionalities and marketing tools. Leveraging technologies such as 5G and AR/VR, we will introduce virtual images and immersive experiences to JD Live.
• Building a new ‘quality e-commerce live streaming’ model: We hope to make e-commerce live streaming not just a sales channel but a brand marketing scenario. Merchants should care more about their customers than about pure sales data, and make sales a natural result of brand marketing. In addition, we will bring live streaming from the broadcast studio out into the field, helping to visualize the supply chain and logistics. I also anticipate that pan-entertainment marketing will be the leading core area of live streaming. The industry should recognize professionally-generated content (PGC)* again. In the past, it was said that PGC does not bring conversion, but in fact, this is because the industry previously didn’t have a good way to leverage PGC.

At JD, we strive to make every live streaming, especially the most important ones, to be professional, popular and interesting, pursuing both effective branding and strong sales results.

 

*MCN: Multi-Channel Network, act as an agent to connect influencers and celebrities with brands, merchants and e-commerce platforms.

*Brushing: A deceitful technique used by sellers to create fake orders.

*PGC: Professionally Generated Content, which is more specialized than UGC is the content created by special groups with professional skills and technique.

 

(yuchuan.wang@jd.com)

by Rachel Liu

JD just released its latest Mobile Phone Industry White Paper which forecasts that the price of a 5G phone may fall to around 1,000 RMB, with 120 million to 150 million 5G phones to be sold in China over the duration of 2020.

Since the beginning of this year, many leading handset brands have chosen to launch their latest 5G phones on JD, including HUAWEI P40, HUAWEI Mate Xs, OnePlus 8, OPPO Ace 2, Honor 30, vivoS6, Redmi K30 Pro and others. In early April, JD partnered with three telecomm carriers in China and leading mobile phone brands to launch consumer promotions specifically for 5G phones. To improve the consumer experience, JD also provides services including rebates, broken screen insurance, extension insurance, and 5G top-up payment service, which have effectively acted as stimulants for consumers to try new 5G products.

In February, JD helped an assortment of brands that turned to online approaches due to COVID-19 to hold new product launches via JD Live, particularly 5G products. Xiaomi, Huawei, Samsung, vivo and Honor have all launched their new products through online press conference. In 2019, JD also successfully established China’s first 5G ecological alliance and 5G service alliance with telecomm carriers and brand partners to lead the overall development of the industry.

 

(liuchang61@jd.com)

 

by Martin Li

JD.com has been supplying medical supplies and daily necessities to overseas customers in 105 countries and regions since January this year.

Joybuy.com is the outbound e-commerce platform of JD.com. It covers more than 200 countries and regions and houses several thousand merchandisers.

Among the countries and regions are Japan, South Korea, the United States and Southeast Asia.

The number of global coronavirus cases has exceeded 2.3 million so far, leading to supply shortages for medical supplies like masks, hand soap, medical alcohol and disinfectant.

JD has allocated RMB 1.5 billion yuan ensuring supply of preventive and medical products, as well as transportation and delivery services at home and abroad.

A Chinese man who studies in South Korea bought masks for less than two yuan each on joybuy.com and received his parcel within just one week.

Starting March 9^th, the Korean government only allows each resident to buy two masks, for RMB 5 yuan each, per week on the condition that the buyer has local insurance.

Joybuy.com has become a shared “special channel” for Chinese students in South Korea to buy masks, the man told customer service staff of Joybuy.com online.

JD has been cooperating with cross-border e-commerce players to transport masks and daily necessities overseas to meet heavy demand.

The COVID-19 outbreak has reduced the number international cargo flights by 90 percent. However, JD has managed to ensure cross-border transportation by rail, sea and transfer flight.

In addition, cross-border merchandisers on joybuy.com are receiving discounts on global delivery. Customers in selected countries enjoy free delivery for certain products.

 

(bjlihao3@jd.com)

by Tracy Yang and Rachel Liu

JD Health is partnering with Beijing KingMed Diagnostics Laboratory to book COVID-19 nucleic acid testing services online, becoming the first platform in China for consumers to book  this service Online. Users can search for the booking service through JD’s app place the purchase and make an appointment with the testing service provider.

In order to improve epidemic prevention and control work, the city of Beijing has issued a series of policies for people returning to work from outside the city. There are five categories of returnees who need to demonstrate negative results on a nucleic acid test before entering the city. They are: confirmed and suspect cases, people who have had close contact with confirmed cases, people returning to Beijing from Wuhan, and from abroad. Returnees who were on business in other provinces who stayed in hotels are also required to show a negative test result before reentry to Beijing. The tests are seen a prerequisite for people returning to Beijing.

Appointed by the Beijing Municipal Health Commission, Beijing KingMed Diagnostics Laboratory is an official designated institution providing nucleic acid testing of COVID-19 for groups and individuals. At present, there are two test sampling sites in Beijing. They are located at Grand Skylight Catic Hotel Beijing in Chaoyang District and Beijing Tylfull Hotel in Haidian District. All personnel entering Beijing can purchase testing services in advance, make an appointment for testing and conduct sampling through JD’s app. After the sampling is completed, the test results report can be obtained within 24 hours.

 

(tracy.yang@jd.com, liuchang61@jd.com)

by Rachel Liu

Italian footwear brand Sergio Rossi opened a first-party flagship store on JD on April 17^th. It is the first online store in Chinese mainland that purchases products directly from the brand.

Mr. Sergio Rossi, founder of the brand, died on 3 April 2020, of complications from COVID-19. The debut of Sergio Rossi on JD served as a tribute to his lifetime achievement.

The new store will offer the brand’s classic collections, as well as its latest Spring-Summer collection, Sergio Extreme, sr1 collection and sr Icona collection.

“We’re facing a difficult and unprecedented situation that make us reflect on different distribution models in order to reach our customers, winking at digital platforms. I strongly believe in the power of collaborations and the importance of contamination in the era of the digital revolution and today I’m proud to annouce our partnership with JD.com. An exceptional partner, a true point of reference, that will deliver extraordinary Sergio Rossi styles to women around China.” said Riccardo Sciutto, Sergio Rossi CEO. “Once again we’re celebrating true femininity through a selection of most iconic styles revised into unique pieces that perfectly match the taste of the woman who loves to shop on JD.”

“We are excited to welcome this world renowned brand to JD’s luxury brands collection,” said Kevin Jiang, president of International Business at JD Fashion and Lifestyle:“During COVID-19, JD’s supply chain and logistics advantages have been able to keep providing JD customers fast and high-quality service. Our luxury buyers went to Milan to Sergio Rossi’s showroom to personally select products based on Chinese customers’ taste. We are confident that our partnership will help the brand further develop in the Chinese market.”

Founded in 1951 in Milan, Sergio Rossi’s elegant style and refined craftsmanship has captured the hearts of many Chinese consumers. The partnership indicates the trust the brand has in JD.

According to the 2019 China Luxury Ecommerce Report released by Yaok Group, 72% of Chinese consumers with net assets of over RMB10 million Yuan think that JD is the most trusted platform to buy luxury products. JD Luxury Express and JD’s luxury white glove delivery service provide a premium shopping experience to online consumers, which is especially important when luxury brands are selecting e-commerce platforms.

 

(liuchang61@jd.com)

By Ella Kidron

Hubei province on the road to recovery following COVID-19 lockdown: JD data looking at enterprise procurement indicates that business in Hubei province are gradually resuming operations. From March 25^th to 31^st, the demand for goods from Hubei enterprises on JD’s platform increased 44.9% compared with the week earlier. On April 8^th, JD announced a plan to invest more than RMB 6 billion in the recovery of Hubei province over the next three years, launching a series of initiatives to support the local economy and the development of local industry. Following the lift of the lockdown, there has been an explosive increase in the number of large items delivered by JD Logistics in Wuhan, Hubei province. Compared with the same period in March, in the first week of April, deliveries increased over 900%. Among the top items were furniture, home appliances and fitness equipment. Air conditioners, refrigerators and gas water-heaters experienced the most significant increase in demand.

Brands find ways to connect with consumers during COVID-19: As another way to help cultural brands during this time, JD has worked with museums and galleries in China to bring experiences online. Live streaming of activities from clubbing to traveling have boomed in China during COVID-19 as a way to help people stay connected and entertained while at home during lockdown or self-quarantine. Not just a means of entertainment, the experience also boosts sales of the museum’s stores on JD. On March 10^th, the Guanfu Museum (founded by Chinese writer and collector Weidu Ma) hosted a session, attracting over 200,000 visitors in two hours. Sales of the museum’s flagship store increased approximately 460%.

Consumption trends in the “new normal”: JD data finds that, as COVID-19 is entering a new phase in China, people are going outside for more outdoor activities, and consumption reflects that. As compared with February 1-17, from March 1-17, sales of cycling-related products, fishing supplies, sportswear and other goods more than doubled month-on-month. Fishing seems to be a highly popular activity, with sales of fishing supplies up 155% month on month. Spring outing consumption among the 25-45 age group is 12.1% higher than the whole of JD’s platform.

New brands and products join the JD family: New brands and services continue to come on JD at a steady clip. Most recently, JD launched a trade-in service for the iPhone SE in which consumers who buy the iPhone SE now under a promotion can later have the opportunity to trade it in and deduct its full value from the cost of new model. This follows the launch of a trade-in service with Apple’s iPad Pro and Macbook Air launched in March – the first of such services for JD to launch with Apple. In other news, water and housing products giant Lixil Group launched a flagship store on JD on April 9^th. It is the first online store to integrate four of Lixil Group’s leading brands:  GROHE, American Standard, INAX and Lixil Kitchen. On April 9^th, JD’s supply chain solution helped support important partner Xiaomi with its 10-year anniversary sales promotion. To mark the official end of the lockdown in Wuhan, a delivery robot delivered some of the Xiaomi products to customers in Wuhan, Hubei province.

JD demonstrates tech and supply chain leadership with products, rankings and partnerships: Earlier this week, JD Cloud & AI launched its edge computing product portfolio. The products, “Edge Physical Computing Service” and “Distributed Cloud Physical Server” are aimed at helping enterprises develop innovative businesses in the era of 5G&IoT. In a recently released ranking by ifenxi, a leading analytics agency in China, JD ranks third among China’s top 30 cloud computing companies. Finally, JD and Blue Yonder, Inc. (formerly JDA Software Inc.), formed a strategic agreement focused on providing supply chain transformation solutions for merchants in China.

Omnichannel Fulfillment expansion: Through a new cooperation with Dada Group, JD has expanded its Omnichannel Fulfillment program with one-hour delivery of daily necessities supported by Dada Now. Customers can directly buy over three million products from participating stores on JD.com and receive them in as fast at 15 minutes, and in an hour on average. JD’s Omnichannel Fulfillment supply chain innovation program integrates many offline channels to deliver orders that originate from JD directly, making the supply chain more efficient and sourcing products even closer to customers.

Looking for more? Check out the below:

• JD Annual Report shows enhanced commitment to ESG: JD released its annual report (Form 20-F) on April 15^th. Among the initiatives highlighted in the report is JD’s enhanced commitment to ESG in 2019. Read the full in-depth article here: https://jdcorporateblog.com/in-depth-report-jds-enhanced-commitment-to-esg/
• This week at JD in photos: https://jdcorporateblog.com/photo-gallery-this-week-at-jd-april-13-17/ 

 

(ella@jd.com)

by Ling Cao

JD released a report this week that reveals insights into Chinese consumer book purchasing habits in 2019 and during the epidemic. Here are some key trends:

• Mid and lower tier markets are driving sales
• Hot topics and current events impact sales
• While many people stayed at home, children’s books, literature, education and calligraphy have become “must have” categories.

In 2019, the highest sales were derived from three book categories including children’s books, literature and education. In 2019, although tier 1-2 markets were still key markets driving book purchases, mid and lower tier markets became increasingly prominent, especially in the central China region, where Hubei province (epicenter of the epidemic) had the fastest sales growth y-o-y.

The purchasing preference for printing and digital books rose simultaneously. Based on data from JD and third party research institutions, 94.1% of China’s online readers read digital books; 77% of them read printing books; 64.1% of them will listen to audio books; finally, 55.6% read magazines or newspapers.

Customers read for different purposes, with 60.1% of them reading for self-improvement, 40% for career development, 36.2% for exams prep or articles, and 36.1% for their children’s education.

Regarding how they spend their money to read, data indicates that in 2019, 25.5% of them pay RMB 501-1000 and 22.6% of them pay RMB 301-500 accounting for most of the customers. While over a half of all customers bought 4-10 books in total, 14.6% of customers bought over 20 books. Regarding basket size, customers in the 26-35 years age bracket grew fastest y-o-y. .

Customers from mid and lower tier markets show greater interaction when purchasing books, tending to write more comments after making purchases, 35% higher than those from tier 1-2 markets. Comments include “recommended by colleagues, friends and teachers”. Overall, we saw the sales gap between mid to lower tier markets and tier 1-2 markets gradually narrow.

The coronavirus kept people at home and drove them to buy books online. From January to March 2020, book sales on JD increased significantly y-o-y. The book categories that saw the fastest increase includes educational supplements, children’s books, and science. Other categories include finance, history, home furnishing, and biographies. Interestingly, customers are buying more calligraphy books than ever before. Similarly, medical and healthcare, and psychology books increase by 20% and 3% in February, respectively; and, 48% and 25% in March, respectively.

 

(ling.cao@jd.com)