JD.com Inc.
JD.com Inc.
11/12/2022 | News release | Distributed by Public on 11/11/2022 23:18
In-depth: Eight Categories of Value Revealed in 2022 Singles’ Day Consumption Trends in China
by Vivian Yang and Doris Liu
JD.com reported a new record in transactions during the 2022 Singles' Day Grand Promotion (SDGP), which ended at midnight on Friday, November 11. The 11-day shopping festival was participated in by an increased number of users and achieved higher-than-industry growth rate, manifesting the vitality and big potential of China's consumption market.
"The ongoing trend of a consumption upgrade is mainly reflected in people's consumption structure and improvement in industrial efficiency," said Hui Liu, director of JD's Consumption and Industrial Research Institute, at the 2022 SDGP media open day on November 11.
Hui Liu at media open day of JD.com's 2022 Singles' Day Grand Promotion
Liu stated that the next phase of China's consumption growth will be driven by deeper connections between merchants and consumers, and among all participants along the industrial chain, including online and offline sellers, industrial belts, farmers and more. JD's sales data revealed that they are collectively generating value in the following eight dimensions:
1. Time value: the long-termism of consumption
Consumers have cooled down on spur-of-the-moment purchases, instead enthusiastically investing in products that can bring high-value and long-term returns, such as products for health, fitness and education, as well as services that help save their own time.
JD Health's SDGP data showed that more than 1,600 nutrition brands doubled their YoY transaction volume, and online consultations with JD Pet Health increased 3.3 times. Over the past five years, service consumption has been expanding from family needs, to sports, health, pet care and more scenarios. Sales of life-related services increased 30 times, that of car maintenance grew 20 times, and bookings for health services were up by 7 times.
Noticeably, JD's 30-day price guarantee program, which promises price difference return upon request in order to free users from the hassles of comparing prices and snapping coupons, was accessed more than 500 million times in JD's App during this year's SDGP.
JD Pharmacy enables convenient health products delivery from offline drug stores
2. Environmental value: rising consciousness of responsible consumption
Keyword searches of "energy-saving," "green," "low-carbon," "organic" and others alike surged dramatically on JD.com. This May, JD launched the "Green Impact Initiative," which made nearly a million kinds of products on its platform more identifiable with environmentally-friendly labels.
JD Home Appliances' highly welcomed trade-in services reached seven-fold YoY growth in number of orders. It also means that during this SDGP, every 2 out of 10 home appliances orders on JD.com enjoyed this service. Many users traded in their old washing machines or fridges in exchange for upgraded appliances, or even cross-category choices, primarily smart phones or watches.
JD Logistics estimated that during this SDGP, its green supply chain operations reduced a total of 200,000 tons of carbon, which involves 9 million uses of recyclable packages - avoiding approximately 80,000 tons of one-off packaging waste. One hundred million product packages were delivered with their original packaging boxes from the factories in collaboration with more than 20,000 brand partners. The company also engaged its end-users to raise awareness of green logistics throughout the SDGP.
A JD courier is delivering products with a recyclable "Green Stream Box"
3. Cultural value: "China-chic" inspired by traditional culture
The phenomenon of "China-chic" has been a booming trend among Chinese Gen-Z. According to JD's data, over the past four years, merchants featuring "China-chic" increased 240 percent, the amount of products increased 99 percent and new brands under this category grew by 68 percent. On the consumer's side, shoppers of these products increased 90 percent, and sales were up by 284 percent.
SDGP data shows that sales of products with "China-chic" elements increased 124 percent YoY. On the super day of J Shop during SDGP, JD's omni-channel fashion and lifestyle business, the transaction volume of wristwatches with Chinese art designs rose more than five times YoY.
In the cosmetics category, 299 brands achieved transaction growth of more than 10 times YoY, and 952 brands more than doubled their transactions, of which 239 are domestic brands.
The J Shop in Xi'an
4. Emotional value: shopping in pursuit of positive feelings
Products and services that can serve as sources of comfort, exquisiteness, pleasure and similar good feelings are well received in the Chinese market.
Take rocking chairs and lazy sofas as examples. They maintained annual growth rates at 77 and 56 percent respectively over the past five years. Meanwhile, sleep-inducing products such as scented candles and aromatherapy steam eye masks have wooed many young customers.
During SDGP, more than 200 trending categories that satisfy such needs achieved more than 100 percent sales growth YoY, including ready-to-cook food, hi-tech kitchenware, warm-protection outfit, regimen products, chic skiing equipment, e-sports gears, and more.
JD's 24/7 Service Centre is in full operation for 2022 SDGP
5. Exploratory value: hidden skills unlocked by consumption
Consumers, instead of simply following the latest trends or updates, tend to try new products to satisfy their curiosity and explore more possibilities from purchases. For instance, the rise of home organizing explores the reasonable use of limited space, while the popularity of ready-to-cook food inspires consumers to explore cooking and food appreciation.
New products are a key driving force for overall consumption, with 79 percent of consumers expressing strong interest in them, according to JD's data. Notably, the transaction volume growth of new products is always faster than the overall increase of the category to which the product belongs. The new product transaction volume of mobile phones, computers and digital products accounted for more than 70 percent, and the categories of food and lifestyle also saw a significant increase in new product transactions.
The proportion of new product orders from JD Little Rubik's Cube, a marketing channel to promote new products, in the overall orders went up 3.3 times in 2022 SDGP, with the conversion rate of new product orders up 3.7 times compared with last year, which is 26 percent higher than the overall conversion rate.
Fresh supply from JD's soilless "vegetable factory" to 7Fresh supermarket
6. Value of a positive circle: quality improvement + agriculture promotion in rural revitalization
Premium products with geographic indications (GIs) from all over China have not only upgraded consumers' dining quality, but have also effectively raised farmers' income. With the advantages of supply chain, JD.com has built a model of direct sourcing from the origin to reduce cost and improve efficiency, creating a positive cycle formed by high-quality agricultural products from the supply side and consumption upgrade from the demand side.
JD's data shows that the continuous infrastructure improvement in rural areas and the development of technology have bolstered the share of online sales of GI products to over 10 percent of the overall agricultural products in transaction volume, indicating an obvious consumption trend and a sustainable path for high-quality agricultural products.
During this year's SDGP, nearly 10,000 kinds of agricultural products exceeded RMB 100,000 yuan in transaction volume, and about 30 percent of grain, oil, tea and other primary processing agricultural products achieved more than 100 percent growth.
Livestreaming onsite in a coffee beans farm in Yunnan province supported by JD.com
7. Value for integration: Omni-channel reshaping retail industry
By merging the borders of online and offline shopping, the omni-channel retailing model extensively integrates physical and digital channels, resources and capabilities to bring the ultimate experience to consumers while stimulating greater consumer potential.
At the moment, tens of thousands of physical stores are under JD's management, including 15,000 JD home appliance stores and other new businesses, such as the J Shop, which focuses on fashion and lifestyle. JD's supply chain has been connected to 3.67 million offline stores in China, with its on-demand retail covering nearly 400 cities nationwide, substantially enhancing the digitalization and fulfillment capability of brick-and-mortar stores.
Additionally, JD Malls, JD Super Experience Stores and JD home appliance flagship stores, which offer traditional electronic categories as well as home, furniture and products, saw transaction volume jump up by 140 percent YOY. Meanwhile, sales at JD's physical lifestyle stores increased by 4 times during the 2022 SDGP.
A JD Mall in Shenyang of Liaoning province powered by Dada Now's on-demand delivery services
8. Value for inclusiveness: continuing to boost the real economy
While ensuring the stability and efficiency of JD's own supply chain, the company is opening up its capabilities to external partners to share universal value in a larger industrial ecosystem and help traditional industries upgrade digitally.
It has partnered with more than 2,000 brands for C2M (customer to manufacturer). Furthermore, 620,000 smart decisions were made by JD's intelligent supply chain system covering replenishment and allocation to fulfillment and more during JD's 618 Grand Promotion this year, realizing an intelligent supply chain collaboration with suppliers of 81.2 percent of self-operated stores.
JD is bringing Jingdezhen ceramics and porcelain with new demand and development opportunities
As a new type of real economy-based enterprise, JD.com will continue to provide solid and stable supply chain technology and services to its partners in the real economy, promoting rural revitalization, manufacturing upgrade and offline retail development to create concrete value for all industries.
Lijun Xin, CEO of JD Retail elaborated on the company's role in the real economy
As JD Retail's CEO Lijun Xin said in the beginning of SDGP this year, "JD.com has real economy DNA, by virtue of our people, warehouses and products across the world. JD.com will always be an integral part along with our partners in building value for the growth of the real economy."