China’s Largest Online Retailer, JD.com Opens New Frontiers
JD.com’s commitment to start investing in the lower-tier cities began several years ago despite the company enjoying an online customer base of 441 million and a revenue of 83.5 billion dollars in 2019. The company is investing in a logistics network upgrade that would facilitate round the clock delivery to tens of thousands of small towns in over a thousand cities in China, as well as construct new warehouses and expand existing ones to expand it’s transfer centers.
The company has further invested in a social e-commerce platform and a light version of the JD.com app to provide low tier cities with the ease of finding products and services. The company is targetting on attracting more customers in the lower tier who appear to prefer JD.com’s strong categories such as fresh produce, consumer goods, and essential items.
According to JD.com news, the company is trying to partner with companies in the over 200 industrial belts in China to design more suitable and more valuable products by JD transforming the digital platform and also benefiting from a more empowered supply. The retailer continues to be the largest supermarket in China and has seen a tremendous flip on categories as it became the Chinese grocery store of choice, with the highest revenue coming from FMCG and Fresh produce surpassing former leading categories of mobile phones, computers, and home appliances that sold equally well in the markets over the same period.
Behind the business successes is the reliability assurance to its customer and partners thus the need to continue creating stronger infrastructure and supply chain investments in the lower-tier cities. The company is working on investing in several companies as part of its strategic plan for 2020 to complement JD.com in terms of capability, scale, scope, and long term business values. Among them are China’s biggest electronics chain, Gome: global giants in supply chain solutions, Li & Fung: an integrated express transport enterprise, Kuaye Express among others.
JD.com news show that them company has ventured into online healthcare consultation has seen the company become a leader and fast mover for pharmaceutical products in China’s health care sector. The retailer has positioned itself as a management system in healthcare that builds on its upper hand in the supply chain and its focus to provide medical services that are driven by technology at all stages of the customers’ business cycle. The health consultation service has had a bigger acceptance level among young people, first-tier and second-tier cities and as a result, the company’s earnings increased by 45%YOY. Pharmacy sales had a huge topline growth, in addition to a 400% year on year growth as people got more accustomed to the new online medical consultation service.
JD.com news shared that they are currently working on a partnership deal with Tianjin Nankai Hospital to build an Internet Hospital with a concept that will integrate both online and offline resources in medicine. The outbreak of covid 19 saw the company establish two specialized virtual centers under the JD health app to offer treatment ENT, heart disease, diabetes, oncology, mental health, kidney disease as well as Traditional Chinese Medicine.
Progressive growth in revenue in recent years continues to demonstrate that JD’s business model has a key advantage in the supply chain with the company record a surge in its online customer base after the pandemic period as more dependence on its supermarket and health care services increase. It boasts of a top-ranking as China’s largest retailer and internet service company.
Born and raised in a small village in the outskirts of Suqian City, Richard Qiangdong Liu is the CEO, Chairman, and founder of JD.com.