by Ella Kidron and Yuchuan Wang

JD’s 618 Grand Promotion wrapped up as the clock turned to midnight on Jun 18. The company reported total transaction volume of over RMB 343.8 billion yuan during the 18-day (Jun. 1-18) sale. There are several key trends behind the results, all of which also provide insight into consumption in the second half of the year.

 

1. Demand for individualized consumption and hunger for new products

Consumers demonstrated an eagerness to get their hands on the latest and greatest, as well as extremely niche products. During this 618, sales of mystery boxes increased six times YOY. Sales of gaming mobile phones and smart pet products increased five times. Hisense’s special TV designed for the European Soccer Championship (UEFA Euro) saw sales increased five times compared with the same period in May.

At the same time, luxury brands that satisfy consumers’ personalized demands show strong performance. Sales of Ferragamo, TOD’s and BALLY increased 150%, 232% and 600% respectively. In addition, over 20 designer brands saw sales increase over 15 times YOY. Consumers continue to embrace the convenience of buying luxury products online.

Over 30,000 new brands and stores were launched during 618 on JD Super, JD’s online supermarket, with over 2.4 million new products.

 

2. Omni-channel as a “new normal”

On-demand consumption has been solidified as a shopping trend in China. The experience of receiving orders in one-hour has brought the customer experience to a new level. The on-demand retail platform Dada-JD Daojia’s sales exceeded RMB 300 million yuan on the final day of the sales on Jun. 18, underscoring the widespread use of omni-channel and consumers’ elevated delivery speed expectations.

The company’s mega experience store, JD E-Space shopping mall, in Hefei, Anhui province and Chongqing, saw sales increased four times during the 618 promotion period, attracting over 5.6 million omni-channel customers. The number of JD’s offline computer and digital stores that support one-hour delivery service exceeded 1,000 and saw sales increase 300% YOY.

 

3. Services as a go-to shopping category

Consumers are expecting to acquire innovative services online. During the 18-day promotion, sales of JD’s online real estate business increased 230% YOY. Sales of housekeeping and cleaning services increased 6.3 times while the order number of car maintenance increased 285%. JD.com also collaborated with 12 airlines and launched 15 air-ticket mystery-box products that saw sales increase 28 times. In addition, genetic testing service sales increased 23 times, making it the fastest-growing category of healthcare services on JD. Consumers are increasingly attentive to their oral health with sales increasing 447%, covering services such as orthodontics, teeth whitening, dental implants and more.

 

4. Technology’s role in driving efficiency

The use of technology was front and center during this year’s 618, driving efficiency for merchants and brands as well as consumers and elevating the overall shopping experience. JD has already become a key destination for consumers to use the DC/EP (Digital Currency/ Electronic Payment). Since December last year’s DC/EP red packet trial, there have already been 450,000 consumers on the JD app using DC/EP a total of 1.04 million times, generating a volume of over RMB 100 million yuan.

JD Logistics demonstrated that distance and remoteness doesn’t bar users from enjoying rapid service. Consumers in 92% of districts and counties and 84% of villages and towns nationwide enjoyed same- or next-day delivery. In over 200 cities across the country consumers were even able to experience “delivery in minutes”. JD’s autonomous delivery robots were deployed extensively in Beijing, Shanghai, Changshu (in Jiangsu province) and elsewhere, with a service volume increase of 24 times compared with the same period last year.

JD’s AI open platform, NeuHub greatly contributed to increasing efficiency in areas such as content review, intelligent recommendation and intelligent writing. It has been called on over 163 billion times during this year’s 618.

 

5. More products from the origin – domestically and internationally

JD Lite, the simplified app for lower-tier markets, saw sales increase 25 times and number of users increase 15 times.

Orders from over 200 industrial belts increased 100% on Jingxi, JD’s social e-commerce platform, comparing with before the promotion. This 618, Jingxi sold a total of 22.5 million kilograms of agricultural products.

Over 20,000 international brands from more than 100 countries on JD Worldwide, JD.com’s imported products platform, joined this year’s 618 Grand Promotion. Among them, sales of nearly 700 brands more than double. The top five international brands are Aptamil from Germany, Estee Lauder from the U.S., A2 from Australia, Nintendo from Japan and Sulwhasoo from Korea. In the fresh food category, 5 million Zespri kiwis and 260,000 durians from Thailand were sold during the 18-day sale.

Chenkai Ling, vice president of JD.com and head of strategy of JD Retail said at an event held at JD Headquarters to honor ambassadors and senior diplomats: “This year, the number of brands and merchants participated in the sale more than doubled. At the same time, we see interesting consumer behavior, one aspect of which is that the rising middle class of China are becoming more and more sophisticated users. They are looking for high-quality, as well as diversified products.”

Consumers exhibited eagerness in not only shopping as they customarily would every time the 618 Festival rolls along at the half-year point, but also in branching out, whether into new categories, or entirely new business or service areas. As JD and the industry closes the curtain on its 18^th birthday, the sale is also a culmination and reflection of consumer trust the company has accumulated since the beginning of its existence.

JD has continued to promote green supply chain efforts, working to reduce the impact of the shopping frenzy on the environment. This 618, the company’s environmentally-friendly reusable packing was used 11.5 million times, reducing nearly 100,000 tons of disposable waste.

Richard Liu’s shareholder letter released on Jun. 18 sums it up well: “We are proud not only that JD.com stocked millions of SKUs in our retail business, and our logistics network covers both urban and rural areas nationwide, but also that no matter where our customers are, they can enjoy superior shopping experiences through a broad selection of quality products, transparent prices and best-in-class customer services to support every aspect of their lives.”

 

(ella@jd.com; yuchuan.wang@jd.com)

by Ella Kidron

China largest retailer, JD.com reported a total transaction volume of over RMB 343.8 billion yuan for its 18-day 618 Grand Promotion. As of 00:11:34 in the wee hours of June 18 the transaction volume already exceeded that of last year’s total (RMB 269.2 billion yuan), and by 14:04 transaction volume reached RMB 305.6 billion yuan.

“We’ve seen pretty good momentum in China this promotion season,” said Chenkai Ling, vice president of JD.com and head of strategy at JD Retail. “We kicked off the promotion around May 24^th and got a lot of early insights on consumer behavior. What’s more, we’ve seen the number of brands and merchants participating in the sale double,” Ling added, referring to the ubiquity of the mid-year sale which started as JD’s birthday and is now celebrated by all players, online and offline, annually.

One of the highlights is the supermarket category, an area in which JD has continued to perform strongly, thanks to a high guarantee of authenticity, quality, and delivery speed. “Some categories peaked during COVID-19, but for a lot of other categories such as fresh and FMCG, we can see a lot of momentum,” said Ling, explaining the reason behind the 618 boom.

In the first three minutes on Jun. 18, JD Super, JD’s online supermarket, saw sales increase 10 times, and in the first two minutes, packaged foods exceeded RMB 300 million yuan while the maternal and baby category exceeded RMB 200 million yuan.

In the first hour on Jun. 18, JD Fresh saw sales increase 70% YOY. Looking at sub-categories, seafood, meat, eggs and poultry, and fruit and vegetables increased 160%, 105% and 80% respectively. Sales of dishes which require little effort to prepare (literally referred to as “fast-hand-dishes”) increased 160%.

Five minutes after midnight, the alcohol category exceeded RMB 200 million and the personal care and home cleaning categories both increased 20 times YOY. In the first 6 minutes, toys had a nine-fold increase.

The pet category has boomed. Post-90s consumers spent an average of RMB 507 yuan per month on pet products in 2021. During 618, smart pet products increased 47% YOY. Ling explained that previously not a lot of people took ownership of pets, but now with the China’s aging population coupled with COVID-19, people are seeking the companionship of pets leading to a boom.

618 is always a popular time for consumers to stock up on products. For example, in the first two minutes on Jun. 18 milk sales had a six-fold increase as did drinking water, while grains, oil, rice, etc. increased five times YOY. Toilet paper increased nine times.

International products from all over the world have had a good showing as well. As of Jun. 18 at 10 a.m., transaction volume of imported products increased 10 times compared with the previous period. JD Worldwide imported gaming phones increased nearly three times. Imported dry cat food increased 108%. On Jun. 1, National Pavilion (dedicated zones on the JD platform for products from a particular country), sales increased 80% YOY. From Jun. 1-16, imported supermarket sales doubled compared to the previous period.

As of 21:40 on Jun. 18, on demand retail platform Dada-JD Daojia’s sales exceeded RMB 300 million yuan, underscoring the widespread use of omnichannel and consumers’ elevated delivery speed expectations.

Services also had a strong showing. Fresh flower orders, “Good Houses by JD” orders increased 108% and 280% respectively. “People are not only buying physical items but also starting to buy certain services,” said Ling. Early on in the promotion season JD saw health services increase 800% YOY. “Consumers are starting to consider internet health services as part of their lives.”

Electronics, a category requiring a high level of confidence in quality, did not disappoint either. From 00:00-10:00 gaming phones increased nine times in the first 15 minutes on Jun. 18. One-hour delivery phones services saw a 20 times increase in the same time period. New energy ACs were up 8 times, gaming TVs exceeded the total of the month of May. Seventy five-inch and over large screen TVs increased 300% YOY. Sales of Xiaomi phones increased 150% YOY.

Another quality and confidence indicator, the luxury category also shined. Sales of Salvatore Ferragamo, Burberry, Tod’s and Bally saw 209%, 10-times, 192% and 25-times increases YOY respectively.

More than reflecting JD’s strength as a retailer and supply chain player, this year’s 618 underscores how the company is enabling partners to reach consumers in China with more precision and deliver an unparalleled experience. It also shows consumption momentum in China at the half-year point.

During the 618 Grand Promotion, the use of JD’s autonomous delivery robots increased 24 times and the daily orders proceed by JD’s smart warehouses doubled.

As for what 618 means for the rest of the year? “We see this trend during Jun. 18 but we expect it will continue through the whole year,” said Ling, citing a heightened appetite for consumption among consumers.

 

(ella@jd.com)

by Ling Cao

 

JD.com kicked off its initiative to bring fresh milk from a pasture in New Zealand to Chinese consumers by partnering with imported milk brand Theland. Announced on Jun. 18, the peak day during JD’s 618 Grand Promotion (June 1-18), both companies aim to bring high-quality New Zealand milk to JD’s over 500 million customers. 

 

“Utilizing JD’s experience in e-commerce and retail, as well as combined insight from industry consumption trends, we’ve seen that more and more customers demand high calcium milk. We believe the partnership will help us deepen our research in milk products, providing customers with a healthy and premium milk consumption lifestyle,” said Xiaojun Wang, general manager of packaged foods at JD FMCG Omni-channel.

 

“The partnership has not only helped bring local labels to Chinese customers, but also worked as a means of cultural communication with JD.com serving as a bridge to showcase the nature-consciousness of New Zealand. Based on the cooperation, customers are able to enjoy purchasing the best-in-class products from all over the world while at home,” said Roy van den Hurk, general manager of global R&D at Theland.

Su Wang, vice president of e-commerce at Theland (left), and Xiaojun Wang (second from left) speaking onsite at JD headquarters, as Roy van den Hurk makes a speech remotely from New Zealand at the newly opened JD Pasture

Theland has 29 pastures in New Zealand. The customized milk from the JD pasture initiative will be officially sold in September. Consumers will be able to trace every step of the production process, from milking, to manufacturing and transportation.

According to Hurk, the product uses raw milk sourced directly from New Zealand, and its protein content far exceed the EU standards.

As JD’s long-term partner, Theland’s milk products are popular among customers. On the first day of this year’s 618, sales of the high-end diamond series of Theland milk increased 17 times YOY, while another children’s milk series sales increased six times YOY.

Data showed that on June 1, sales on the JD Worldwide (JDW) platform increased over 120% YOY. Nearly 1,500 brands’ sales increased over 100% YOY, respectively. On Jun. 14, the designated promotion day for imports, sales of the online supermarket for imported food increased 240% compared with the previous day, while first party retail grocery sales increased 130% YOY.

 

(ling.cao@jd.com)

by Vivian Yang

In appreciation of Swiss brands’ strong performance on JD.com, the Chinese e-commerce company issued the “Friend of JD.com – Excellent Performance Partner” award to the Swiss embassy to China on Jun 18, the final date of the national mid-year shopping festival, known as the JD 618 Grand Promotion.

Mr. Yves Morath, counselor and head of the Swiss Business Hub China accepted the award at JD’s headquarters in Beijing.  Speaking about the potential for cooperation with China and JD.com in the future, Mr. Morath said that: “Switzerland is definitely a very strong country for premium consumer goods, so we are very optimistic that we can benefit from the potential market of the Chinese market with JD.com. What we see is more and more Swiss premium consumer goods are very active in the Chinese market, especially in the e-commerce market. We see a very great potential, so of course we hope that we can strengthen our position also on JD.com, and have even more tight collaboration in the future.”

Mr. Yves Morath (second from the right) received the “Friend of JD.com” award on behalf of the Swiss Embassy

Swiss brands enjoy a high reputation among Chinese customers, as they do in the rest of the world, for their high quality and reliability. Being an e-commerce platform that always puts trust and quality at the core of its business, JD.com is the natural go-to place for Swiss brands in China, with products ranging from luxury, food, and beauty to healthcare products and more available on its platform.

Mr. Yves Morath in an interview during his visit to JD’s big data command center on June 18. 

Swiss watches are a good case on this point. JD Fashion offers over a hundred Swiss watch brands through both the first-party and marketplace models. Most recently, Zenith SA launched an official third-party store on JD.com on May 17. The store is an addition to the brand’s first-party store on JD.com which opened in 2017. Breitling, another time-honored Swiss watch brand operating under both sales models on JD.com, was awarded by the platform as the “Sustainable Development Partner of the Year” on May 20 in recognition of the brand’s efforts to bring environmental-friendly products to JD’s customers.

Sustainability is close to the hearts of many Swiss brands and the Swiss embassy. Nestlé, the Switzerland-based company has been working deeply with JD on many fronts, such as, designing Consumer-to-Manufacturer (C2M) products that are better tailored to Chinese customers’ needs, developing medical purpose baby food while promoting pediatric knowledge and nutrition related content, and collaborating on a greener supply chain and digitally-driven distribution center that reduces waste in fulfillment processes.

During the Sino-Swiss Economic Forum (SSEF) last November, Swiss Ambassador to China Bernardino Regazzoni emphasized Swiss enterprises’ commitment to sustainable development in China: “They are even generating synergies among themselves here in China to bring out sustainable, innovative and creative solutions to global concerns.”

 

(Vivian.Yang@jd.com)