JD.com hopes to lead the omni-channel retail game

2 min read
The JD.com faction for retail. Image Credit: Dada-JD Daojia

At a conference in Beijing on October 31, JD.com reaffirmed its partnerships with social network giant Tencent, traditional retail giant Walmart, and to-home grocery delivery company Dada-JD Daojia.

Omni-channel retail refers to the integration of online and offline commercial retail practices and related user experience. The model (also known as “new retail”) is now recognized as a major trend in the industry as customers are becoming increasingly picky about what and how they make a purchase decision.

Li Kefeng, vice president at JD.com, said, “JD.com has acquired valuable retail experience in over 10 years…[Joint] omni-channel practices shows retail infrastructure built on our mature technology.”

Li said Walmart and JD.com are already sharing some inventory data and logistics system. “Our delivery staff can now directly pick up items from Walmart’s warehouses and deliver them to our own customers.” Further, according to him, the partnership relies on Tencent for social-platform based communication and digital payment.

“We are committed 100% to be truly omni-channel,” said Jordan Berke, vice president at Walmart’s business unit China eCommerce.  “We must win in serving the one-hour generation.” Berke believes the one-hour limited quick one-stop shopping and delivery demand implies a new retail generation.

In a report PwC released on the 2018 China retail landscape, the country is expecting a market worth $6.2 trillion, with the contribution of around $1 trillion online sales and $5.2 offline sales. As costs of acquiring new consumers increase and online growth encounters bottleneck, omni-channel’s efficiency and management is a key to further growth potentials.

Sun Shifang, head of the China Economic Trends Research Institute (CETRI), said during the conference that he expects omni-channel solutions and models to foster tech innovation and re-structure consumption habits.

“Dada-JD Daojia will serve as an infrastructure supporter to assist implementation of our [partnership’s] omni-channel strategies,” said Kuai Jiaqi, founder and CEO of JD Daojia. In August, this company partly owned by JD.com raised $500 million from Walmart and JD.com.

JD Daojia already cooperates with 250 Walmart stores in China, including 10 with smart warehouses. Berke explained that the 11.11 festival is shifting from an e-commerce one mainly taking place online to an omni-channel one which lays increasing emphasis offline. He is expecting JD Daojia to “completely transform” the physical Walmart stores.