Shen Haoyu And The Media Explore More Fashion Development Strategies Of The Company.

Beijing, China, is like a Shen Haoyu. He doesn't always use the word "war".

Business leaders rarely use such language after they leave the board of directors.

Mall CEO is no exception.

In Shen Haoyu's recent dialogue with BoF, he gave a lot of comments to an unspoken competitor, but he would not be able to easily point out the biggest opponent in the virtual battlefield.

It is really not necessary.

Any familiarity with China

Everyone knows that the two sides are the Jingdong mall under the Jingdong group and the Tmall mall under the banner of Alibaba.

The two are B2C e-commerce platforms for daily use, from furniture to food to fashion.

The scale of operation of the two operators is also astonishing.

Tmall provides an electronic commerce website for the major fashion brands from Burberry to Zara, positioning itself as China's largest online market.

According to iResearchChina, Tmall mall occupies more than 50% of its website in China's B2C online shopping platform market, while Jingdong share is less than half.

But Jingdong claims to be the largest self-employed electric business in the country, and has always been enterprising to attract more international fashion brands to stay.

Jingdong mall CEO Shen Haoyu

In February this year, the Shen Haoyu team flew to New York city to win a lot of media coverage for Jingdong by sponsoring a group of young Chinese designers during the fashion week.

Using the good relationship between the company and the US brand (CalvinKlein, TommyHilfiger and Gap have set up official flagship store in Jingdong mall), Shen Haoyu has also gained popularity in other US industry leaders through New York as a springboard.

This week, his team came to London to recruit British brands. Last year, they also went to Italy to do the same recruitment work to make their international brands more diversified.

Jingdong, which has signed a deal with WAL-MART (Wal-Mart) for about $1 billion 500 million, seems to have been the most active in many years, but the Chinese market is still in constant integration and the competition is fierce.

BoF talked to Shen Haoyu, chief executive of Jingdong mall, to explore more fashion development strategies of the company.

Media: Jingdong is a huge electronic retail giant. Its share in China's online shopping market is impressive, but it always exists in the shadow of Tmall mall.

How can we compete with the main competitive rival?

Shen Haoyu: from the first day we founded 13 years ago, we are most concerned about product quality and quality assurance.

We have established credibility among consumers, and most of them prefer genuine goods to fake ones.

This is why we have been leading the market growth and increasing market share.

Media: your management team likes to emphasize Jingdong's "zero tolerance policy" for fake products.

In this way, you must believe that your policy is stronger than that of Alibaba. Why?

Shen Haoyu: our business philosophy is different and business models are different.

If the management of the company believes that the quality of the fake is better than the real product, the website produced by the company will surely reflect this idea.

We will never agree with the idea that fake goods are better than real goods.

Therefore, we have set up a self operated business mode, and we control the supply chain ourselves to ensure that we can carry out the most stringent control.

Secondly, when we launched the third party platform in the year, we promised that consumers would control the number of sellers, and it would gradually increase to 100 thousand sellers, but it would not exceed this amount.

We guarantee that in this quantity, we can effectively use the method of qualification check and so on. When the sellers join in, we will conduct management monitoring, including the third party Monitor Company and big data analysis to prevent our website from counterfeit goods.

It is impossible to adopt a business model that can accommodate 10 million sellers and claim to track counterfeit goods in the first place.

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Media: last year, Jingdong acquired a total paction volume of 462 billion 700 million yuan (GrossMerchandiseVolume).

How many of them come from fashion products?

Shen Haoyu: we do not publish this classified data, but fashion, clothing and footwear products have been our fastest growing product categories.

If you look at the number of single products purchased in our different product categories, these products are always the top priority.

Media: Jingdong has entered many international fashion and sportswear brands, such as Gap, Esprit, Marks&Spencer, Forever21 and other fashion brands, but there are relatively few high-end designer brands such as CalvinKlein and TommyHilfiger.

How can we persuade more international brands to cooperate with you instead of Tmall, YooxNet-a-Porter or Shang Ping, vip.com and other domestic fashion vertical providers with loyal audiences?

Shen Haoyu: it can be said that the high-end fashion brands are still in the early stage of adapting to the whole category of e-commerce platform, and we understand the hesitation of the brand side.

But the reality is that nowadays Chinese consumers are more shopping online, which is different from the situation in Britain or the United States.

If high-end fashion brands want to join the competition in China, they will have to appear on the Internet.

They are more and more aware of this.

Recently, Y-3 entered our Jingdong.

We also set up an official self flagship store for Trussardi recently.

We have made a lot of efforts in the United States and are growing fast in Europe, but the reality is that European brands may not know that we are the largest Internet companies in China, nor do we know that we have 170 million active users.

We are working hard to change this.

Jingdong enters New York Fashion Week

Media: in the early days of Jingdong, founder Liu Qiangdong had achieved great success in electrical and electronic products. For some consumers, the website seemed to sell these things without any fashion products.

Wouldn't it be necessary to pick a clearer relationship between Jingdong and fashion to change this perception?

Shen Haoyu: our roots are in consumer electronics products, but we were very early in the category.

Amazon also takes root in book products, but no one now says Amazon sells books only.

Media: so, is Amazon your closest competitor?

Shen Haoyu: people compare us to Amazon, because we all take root in our own business and add third party platform business to it.

We all do proprietary and third party platforms, but in general, like the long tail category like fashion, the third party platform is more common.

Even in such a mode, we can also provide warehousing and logistics services for the brand, which is incomparable.

But the reality is that no electricity supplier in the world can reach the standard of serving and serving the next day for more than 600 million of the population, so I am not sure if anyone can compare with us.

And you can also use Jingdong shopping directly on WeChat. Our brand can directly target marketing in this instant messaging application which is almost monopolized in China. This is the unique feature we can offer.

Media: let's talk more about this.

When WeChat's parent company Tencent joined Jingdong several years ago, analysts predicted that the move would "change the rules of the game" and further innovate the mobile terminal marketing solution.

But now some people doubt that the rate of return is not too high. Is that true?

Shen Haoyu: apart from our competitors, we have not really heard doubts about the success of this partnership.

Look at the number of users.

Before the cooperation with Tencent in 2013, we have 47 million active users throughout the year.

According to the figures released in the last quarter, we calculate about 170 million active users throughout the year.

The cooperation with WeChat has made a very important contribution.

Let me give you another specific example.

Last year, "double eleven", more than half of the first users of Jingdong shopping came from Tencent's two social applications: WeChat, mobile QQ.

Our partnership with Tencent in changing the rules of the game is just one of many successful examples.

Media: the partnership with Tencent can be regarded as a competition initiated by micro-blog close to Ali, but they also have Alipay. How do you compete with this broader ecosystem?

Shen Haoyu: let's try this way: if you chat with Chinese people, you will find that WeChat is the most important network platform in China, and the number of active users is 700 million per month.

In China, half of the time spent on the Internet is spent on WeChat.

Think about it: they spend more time on WeChat than using web browsers, e-mail and any other social media channels.

Moreover, WeChat also has an electronic payment system across the country.

Tencent is China's most valuable Internet Co, which is no coincidence.

Media: the Chinese government's recent import and export tax policies and regulations for cross border retail are complicated and sometimes seem contradictory.

How can you improve the current situation of such an electric business enterprise in order to make your business easier to make and profit?

Shen Haoyu: the new regulation of cross-border electricity supplier is still in its early stage, so there are still many things to do.

But the channels already opened are already enormous.

In the final analysis, consumers will choose cross-border mode because they prefer to import high-quality products, not only because they can pay less.

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Media: over the years, you have invested heavily in Jingdong's warehousing network and advanced logistics chain.

What are the obstacles that need to be overcome? What else do we need to continue?

Shen Haoyu: we have been building highly efficient automated warehousing and logistics systems, enabling us to speed up the logistics of our parcels to consumers.

If I make a single order in the UK or the United States at 10 in the morning, I always hope that the package will arrive in the afternoon, but at present, other companies can only copy our efficient delivery speed within a limited geographical area.

We can provide the day service and the next day service for the 600 million population area.

We can also guarantee that the major cities in the country will deliver them on the same day.

In the area that is delivered on the same day and the next day, you can deliver it on the day before 11 a.m., and the order will be delivered before 11 pm.

In 2015, more than 85% of self operated orders were delivered on the same day and the next day.

Media: many people are talking about Amazon's UAV distribution (AmazonPrimeAir) project recently.

What is the current development of UAV express delivery in China? What do you think will happen in the next few years?

Shen Haoyu: Recently, we carried out the trial operation of UAV distribution in rural areas, which is a huge potential market.

We are not going to fly UAV directly to the door of our customers, but to fly to the Jingdong's "village promoter" in the village, and then to the ordinary peasant hands by the rural promoter.

It is hoped that this will eventually help us send goods to all rural areas where roads are not smooth.

Media: the global fashion industry has been hit by China's economic downturn to a small extent.

Do you believe that the Chinese market will continue to go down in the future, or have we passed the most difficult time?

Shen Haoyu: although consumers will be very worried, Jingdong's consumption growth and consumption growth in China as a whole are quite healthy.

The pformation from traditional stores to electric providers is very beneficial to us, and the trend of pformation is obvious.

We also saw that the C2C business model, which once dominated China's electricity providers but could not guarantee quality and integrity like ours, began to pform.

So, yes, maybe the economic environment will have some impact, but we also see great opportunities.