Electricity providers are from "light platform" to "heavy platform" change

On July 8, 2014, Huang Dongsheng, vice president of Jingdong Group, attended the 2014 Shaanxi Electronic Commerce (Cross-border) Exchange and Cooperation Promotion Conference. He analyzed the status quo of China's electricity supplier industry and made judgment on the development trend of the industry. Huang Dongsheng pointed out that the current e-commerce industry and the transformation of traditional industries are undergoing a profound integration of electricity supplier growth catalyst from the era of mobile Internet, "heavy platform" strategy, and traditional retail and many other aspects. As the major development strategy of Jingdong in 2014 - internationalization, it coincides with Shaanxi's "Silk Road" strategy in the air.

The following is the text of Huang Dongsheng speech:

Today, online shopping has become the mainstream way for people to shop. According to Bain's forecast, the online shopping market in China is expected to maintain an average annual growth rate of 32% in 2015, reaching 3.3 trillion yuan by 2015, while iResearch estimates that the online shopping market in China will exceed that in 2016 3.6 trillion yuan. Can be said that the development of e-commerce in China is unlimited. We believe that the current e-commerce industry and the transformation of the traditional industries are deeply integrated, how traditional industries, brands, manufacturers, distributors to achieve effective collaboration between the overall supply chain to improve the efficiency will determine the business The future of long-lasting competitiveness.

"Heavy platform" strategy grab consumers "pain point"

If the entire electricity supplier industry there are still variables, the biggest may come from where we are in the era of mobile Internet. With the popularization of mobile devices such as smart phones, mobile online shopping is rapidly infiltrating into consumers' lives and showing a momentum of explosive growth. Judging from our JD.com performance, orders from mobile terminals now account for 18% of the total order volume and are growing rapidly at a rate much higher than the overall rate. For example, during the JD Jingdan 618, orders from mobile terminals accounted for One quarter.

On the other hand, from the consumer's point of view, the essence of e-commerce is to promote the user's consumer experience. As people's living standards improve, low prices are no longer all of the consumer experience, products and services are increasingly valued by consumers.

As e-commerce competition from a simple scale, low-cost era, and gradually enter the era of user experience, "heavy platform" is increasingly becoming an unavoidable issue. Some people think that e-commerce is a "light platform", such as heavy marketing, technology, social networking and payment. The "heavy asset" link that needs long time and big capital investment in warehousing and logistics is usually handled in the form of outsourcing. If you examine the e-commerce model in developed countries will find that consumers demand for timely delivery of goods is not strong, but in China this demand is very strong. To "enhance the user experience" as the goal, Jingdong since 2007 began self-built logistics, this year also adopted the pioneer model to expand self-distribution services, as of now, has formed a national 1739 counties in the self-delivery system .

Do electricity providers, pay attention to seize the pain points of consumers, screaming point, explosion point. The "heavy platform" strategy is the key to Jingdong grasp the pain point. We think "heavy platform" is a necessary condition for accumulating big data, while big data is the basis for more effect of the entire e-commerce platform. Line of logistics data, address data and user characteristics and so on have a very important value, there is no self-built logistics will not be able to obtain these data.

We note that especially since 2013, some major electricity suppliers have started to step up JD.com's efforts to increase investment in warehousing and logistics. Of course, the path is not the same, some are to transform the traditional layout of warehousing and logistics, while others take the "crowdsourcing" mode of integrating storage and distribution resources into their own data platform. But no matter how the model, from "light platform" to "heavy platform" change, is becoming the trend.

For traditional retailers, the rapid development of e-commerce has had a strong impact on their pricing system, service mode and brand building. We estimate that e-commerce retail will account for one-fifth of the total retail sales in the next five years. With the popularity of the Internet and the formation of online shopping habits, traditional retail will also increasingly try to "touch the net." At the same time, e-commerce is also trying to penetrate the line, so as to give users more in place of service. Jingdong growth process, one of the most crucial ability is to quickly meet the different stages of the strong demand for user service capabilities. In 2014, JD.com regarded O2O as one of its major development strategies. We hope to bring consumers a better shopping experience through cooperation with traditional retailers such as convenience stores.

Internationalization: Creating "the Jingdong of the World"

Huge demand, is the direction of business efforts. According to WTO data, last year's global cross-border B2C e-commerce realized a turnover of 100 billion U.S. dollars and China accounted for 30 billion U.S. dollars. In 2014, as the U.S. and EU economies hit a bottoming out and the foreign trade situation is getting better, the development of cross-border e-commerce is expected to usher in explosive growth. We are actively and steadily expanding the international market and strive to create "the world's Jingdong." At present, Jingdong has published an English website and started an international recruitment program. Recently, Jingdong adjusted the group structure and set up its overseas business unit. This year, Jingdong's third-party payment institution, Internet Banking Online, has also been approved for cross-border payment of licenses.

The approval of Jingdong cross-border payment licenses allows users to enjoy online renminbi pricing and settlement through online banking on the one hand, and on the other hand it can greatly enhance the success rate of transactions and enhance the user experience. In addition, Jingdong will realize the import and export of products through "large-sum trade" and establish entity-operated companies overseas to conduct e-commerce business and local e-commerce service to local residents. At the same time the establishment of customer service center to provide local return service.

March 19, Xi'an officially approved as a national pilot city of cross-border trade in e-commerce services. Xi'an is the starting point of the new Silk Road Economic Belt and an important node city of the New Eurasian Continental Bridge. Developing cross-border e-commerce for Asia and Europe plays an important role in accelerating the transformation of foreign trade in Xi'an and promoting economic restructuring and upgrading. Based on its important geographical location in Xi'an, Governor Lou said in May that it will build a distribution center for logistics in Shaanxi and build an all-round "Silk Road" in the sky. I think the internationalization of Jingdong coincides with the strategy of airborne "Silk Road" in Shaanxi.

Jingdong and Shaanxi fate, but also from Jingdong in the northwest region's strong logistics warehousing construction. This year, in order to improve the layout of the nationwide retail network, we implemented a major development strategy of the company - the channel sank, and the seventh largest regional branch in Beijing East dropped to Xi'an. The establishment of the northwestern Beijing-Beijing region has made up for the long-standing absence of large-scale e-commerce and modern logistics centers in western China and has also become a catalyst for the economic development in Shaanxi and even the northwestern region.

At this stage, the service scope of Jingdong Northwest Branch takes Shaanxi as the center and radiates Xinjiang, Gansu, Ningxia and Qinghai. Now we have provided 211 limited-time high quality services to some urban users in the northwest region. In the future, we will further accelerate the logistics through the further improvement of regional warehousing and logistics system in order to increase Jingdong's business growth in the northwest Third and fourth tier cities in the penetration of efforts for the Northwest users to provide more quality services.