How To Understand The Strategic Upgrading Of Jingdong'S Open Platform?

In January 3, 2017,

3C signed a strategic agreement of 1 years with the famous 3C digital shopping firm "green Sen digital" under the line, and the Jingdong has fully access to the Jingdong warehouse. At the same time, the two sides will carry out more in-depth strategic cooperation at the financial, channel and after-sales levels.

The signing of Jingdong and green Sen digital signifies a significant breakthrough in Jingdong's platform thinking and the first strategic cooperation between Jingdong and POP business.

With the emphasis on both proprietary and platform businesses, Jingdong will open a breakthrough in the open platform business in 2017, and the open platform will also contribute more revenue and profits to Jingdong.

Wednesday, and one to do

The seller of the platform exchange and cooperate to know why Amazon can make money, and after the operation of the proprietary business, why does the Jingdong shift the focus to the open platform business?

This friend company mainly makes small department stores. Its annual sales volume is tens of millions of yuan, and the unit price is 100 yuan.

Amazon deduct 15% Commission, and use FBA services (Fulfillment by Amazon, Amazon's behalf of the delivery business), average 50 yuan per unit.

To put it simply, 100 yuan per sale and 65 yuan contributed to Amazon.

Amazon deducts operating costs and can earn nearly 20 yuan from every 100 yuan of sales.

Self run can never have such a high profit. Compared with that, Jingdong's direct discount and warehousing and logistics charges are too low in China.

2017 Jingdong open platform strategic upgrade started

East elder brother judged that 2017 will be the year of Jingdong open platform strategy upgrading. There are three important premises:

From "brand collusion" to "collusion" to speed up the integrated platform

At the time of listing, Jingdong disclosed that the number of SKU in 2013 was 40 million 200 thousand. After that, there was no specific disclosure in the earnings report. It is estimated that it is at least 60 million level (1 shop is 3 million disclosed), from 3C electronics, Jingdong expansion or 2010 sniper Dangdang listing.

At the end of 2016, Lao Liu said, "the Jingdong book business will be more than Dangdang in 2017 and become the first of the whole network."

According to the past, everyone thinks that the Jingdong is good at its own products. In fact, the Jingdong supermarket, fresh and fresh, shows its potential in the non - standard products.

In 2016, Jingdong significantly accelerated the development of non-standard product development platform business. With apparel business, it has ripped a hole in the clothing category of Tmall.

In the past, Jingdong's open platform strategy was

Upgrading, 2017, will speed up the integration of channels to speed up the turning point of integration.

Take this strategic cooperation with Jingdong, the number of green digital, focused on the sale of 3C electronic line. In 2013, when it was founded for 10 years, its annual sales exceeded 1 billion. At present, the average annual growth rate is 60%.

Retailers with the advantage of offline channels are actively embracing Jingdong. Jingdong not only accepts it, but also shares data in depth cooperation in finance, logistics and after sales.

This not only lets East elder brother think, in 2012, Tmall promoted the open platform business, and pulled all the vertical B2C, such as Dangdang, Gome, Le Feng, Hao Le buy and so on, not to mention the stamina of these companies, but Tmall has been "Thunderstorm and heavy rain".

Jingdong is different. Self operated business has laid a solid foundation for channel integration.

Upgrading of basic services such as finance, logistics and cloud technology

Jingdong 2016Q3 earnings report that Jingdong financial will be stripped from Jingdong group, which will not only drag the future earnings of Jingdong earnings from financial investment losses, but also, "the main purpose of this reorganization is to pform the financial pformation of China into an enterprise with only Chinese investors as shareholders". The implication is to go to the VIE structure so as to get more financial, insurance and other licences in the future.

Jingdong will provide a more solid service base for open platform businesses in terms of consumer finance and supply chain finance.

As for warehousing and logistics, as of September 30, 2016, Jingdong has 7 logistics centers nationwide, operates 254 large warehouses, and has 6780 distribution stations and self promotion points, covering 2646 districts and counties nationwide.

In the third quarter, more than 85% of China's proprietary orders could be delivered on the same day or the next day.

Jingdong's unmanned aerial vehicle distribution, robot sorting and other intelligent logistics results have been put into operation, allowing Jingdong to have more efficient landing service capabilities to develop to businesses.

In contrast, Jingdong cloud is slightly inferior, but is also constantly improving. In addition to cloud computing and cloud storage, product innovation for enterprise customers is also coming out.

For example, a week ago, Jingdong cloud one-stop website construction service was formally launched, which can help businesses customize station service and template service.

Jingdong cloud Open Cloud station service can greatly simplify the complex steps of website construction, and can easily finish the construction without professional skills.

Cut off the smooth pition after patting, traffic aggregation B2C business

As we all know, Tencent strategic stake in Jingdong in 2014 will be patted and packaged together for sale, after the disk, Jingdong once made a pat to try to tie down Taobao, however, contrary to expectations.

Compared with Jingdong's B2C business, pat C2C business is easier to be criticized by fakes and brushes. Therefore, it is the inevitable choice for Jingdong to "break ranks".

In November 2015, after the Jingdong announced that it had stopped the C2C business, it had completely closed the pat net since April 1, 2016, and has successfully completed the pition.

Meanwhile, Ali is furious that the US government has once again included Taobao in the "notorious market".

Jingdong can concentrate traffic resources on B2C services.

In addition, Jingdong and Tencent launched the "Beijing Teng plan", and two months ago, with today's headlines made the "Beijing strip plan", aimed at social business, content providers have new trees, Jingdong mobile traffic ecological strategy rudiment, for the 2017 Jingdong open platform for the strategic upgrade to lay a solid foundation.

How to understand the strategic upgrading of Jingdong's open platform

The proportion of Jingdong's proprietary business exceeding 50% is only a matter of time.

At the Jingdong 2016Q3 earnings analyst conference, Liu Qiangdong made it clear that "in all categories, Jingdong strategy is" self + platform "synchronous development.

He also stressed that "in the long run, the GMV ratio of the third party platform has exceeded 50%."

Amazon China officially opened the third party platform in July 2011, when Amazon's global third party sellers accounted for over 30% of the total merchandise sold by Amazon, and by 2016 Q3 accounted for 62.5% of the sales of Amazon's open platform.

For Jingdong and Amazon, open platform business plays a key role in attracting more high-quality businesses to enter the region, bringing overall sales growth and improving profitability.

Amazon's open platform accounts for 62.5% of GMV, and its revenue contribution is 16.57%.

According to the world clothing and shoe net, Amazon's total Q3 GMV in 2016 was US $67 billion 500 million, of which $25 billion 300 million was self operated, 42 billion 200 million US dollars for open platform and 62.5% for open platform.

The proportion of Jingdong's proprietary and open platforms is basically Amazon's upside down, or self-employed.

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Amazon's open platform business (3P) is growing larger and larger, contributing more and more revenue and profits.

Without open platform business, Amazon's huge losses are unquestionable.

There are many comments that Jingdong's open platform is getting bigger and bigger, and it will become a Tmall model.

In essence, there is no relationship between Jingdong mode and Tmall mode. Jingdong model is more like Amazon, and there is no need to worry about improving the proportion of open platforms.

With the expansion of open platform business, the demand for FBA services is increasing.

The open platform goods provide the same user experience, and more importantly, the profit of the open platform is actually much higher than that of the self operated platform.

In 2016, Q3, Amazon's other services earned 10 billion 400 million US dollars, accounting for 31.8% of its total revenue. It was mainly composed of four parts: open platform, third party business commission, AWS, logistics revenue and Prime membership fee.

After deducting the revenue of Amazon's cloud service business AWS in the three quarter of US $3 billion 230 million, the Prime membership revenue of US $1 billion 750 million, the third party business commission and logistics income of the open platform amounted to US $5 billion 420 million, accounting for 16.57% of the total revenue.

In 2016, Q3 received 5 billion 530 million of Jingdong's other services, accounting for 9.1% of its total revenue.

If Jingdong and other businesses are excluded, the contribution rate of the open platform will not exceed 7%, and there will be more than three times more room for improvement.

The value of Jingdong's open platform is underestimated.

First, from the perspective of traffic efficiency and cost, Jingdong is superior to Taobao Tmall, which has been compared with the three prospectus companies listed by Yin men, rip and silk and Han Du Yi house.

Second, from the category focus, 80% of Jingdong's POP platform business comes from the clothing and home sector. With the adjustment of Jingdong category planning and the introduction of the new investment policy, other categories of businesses are promising.

In addition, the Jingdong CFO Huang Xuande read at the 2016Q3 earnings analyst's meeting: "Jingdong's open platform business, in view of the impact of the" anti brush "initiative, this year (2016) performance is underestimated. If other conditions remain unchanged, the performance of the open platform business will be better next year, and not only from the traditional clothing, department stores, but also for the long tail products of some electronic products, we will also develop an open platform.

The strategic upgrading of Jingdong's open platform is more important than quality.

After WAL-MART joined Jingdong, in the third quarter of 2016, part of Jingdong's revenue came from shop No. 1, including the open platform business of No. 1 store, and the small-scale revenue generated by some of the performance services provided by the company.

In the future, the synergy between Jingdong and No. 1 stores will be strengthened in the category of super chemicals such as daily chemicals, fresh products and so on. WAL-MART, Yonghui and other offline channels have laid the foreshadowing, with Jingdong's open platform strategy upgrading, businesses can enjoy the bonus of offline offline channel integration.

According to the world clothing and shoe net, the 2014Q1 Jingdong open platform has reached 3 merchants, and Q4 doubled to 6 000 in that year. By 2015, the number of Q4 merchants has increased to 9.9, and by 2016, Q2 has increased by only 1 thousand.

Therefore, Dong Ge believes that although Jingdong platform strategy upgrading in 2017, it does not mean that the number of merchants will increase blindly. Instead, it will focus on the quality of merchants, optimize the investment rules and operation mechanism, support the high-quality businesses with limited resources, and build a benign ecosystem. Last year, the double 11 Jingdong launched a massive anti-corruption campaign, which has ruled out some man-made obstacles.

Jingdong to upgrade its platform strategy and cooperate with Jingdong's "economies of scale" strategy

Combined with the passage of Jingdong CFO Huang Xuande, it is easier to understand that the main leverage of Jingdong to increase profit margin is still from the scale economy effect of the expansion of the supplier scale. The profit margin of Jingdong self operated business is lower than that of the first line retailers on the line, and the average difference is over 10 percentage points, partly because the scale of Jingdong has not yet been the first in all categories, but with the development of time, it will be realized.

Liu Qiangdong also has a similar position: Jingdong self run products, once the profit point has been achieved, in fact, have a sustainable profitability.

For example, he said: now the products of Jingdong household appliances not only keep a high growth rate while the whole industry is going down, but also have achieved a sustained profit for a long time, and competitors are losing money in this category.

Therefore, from the strategic positioning of Jingdong's "economies of scale" to profit, the strategic escalation of the open platform in 2017 is echoed, and there will be premium space on the scale. With the sharing of data between Jingdong and merchants, the supply chain sharing will come naturally in the future. The third party merchants will benefit from the profits brought by "scale" when they add bricks to the trading platform of the Jingdong platform.

The acceleration of the "platform" Jingdong is not "short and long" but the combination of self advantage and open platform. The self-development of open platform experience will be an important development direction for Jingdong in the next two years to become bigger and stronger, and form a momentum of "self support + platform".

The environment, consumption upgrading, and consumers' pursuit of quality, brand and service are constantly improving. For consumers, they can add more product choices on the basis of enjoying the same service of Jingdong.

More interesting reports, please pay attention to the world clothing shoes and hats net.