According to the data from the China's B2C Online Retail Market Quarterly Monitoring Report in 2020Q1 released by Analysys, in 2020Q1, the transaction size of China's B2C online retail market was RMB 1.25226 trillion, with a year-on-year growth of 6.2%.
Figure 1-1 Transaction size of China's B2C online retail market, 2017Q1 - 2020Q1
In terms of market share, in 2020Q1, the total turnover of Tmall increased by 8.5% compared with that in the same period last year, occupying 63.1% of the market share, ranking first. JD.com's total turnover increased by 9.4% compared with that in the same period last year, with a market share of 25.0%, ranking second. Suning.com ranked third with a market share of 6.2%. VIP.com and GOME ranked fourth and fifth with market shares of 3.1% and 0.5%, respectively.
Figure 1-2 Trade share of China's B2C online retail market in 2020Q1
Due to the influence of the Lunar New Year holiday, Q1 of each year will be a relative off-season for e-commerce. Moreover, in 2020Q1, the COVID-19 epidemic further expanded the impact of the off-season and extended its impact time. Therefore, the overall growth of the e-commerce market basically stagnated, and many platforms even showed negative growth. In the face of the epidemic, various platforms had tried their best to create conditions for themselves to survive the hard time of the epidemic based on solving the survival difficulties of various merchants.
Tmall, which has the foundation of the ecological resources of Alibaba, starting from multiple dimensions, could launch many assistance measures for merchants together with Taobao and other platforms. In terms of finance, it made use of the collaboration with Mybank to not only provide early money collection services for eligible merchants, but also provide loans with discounted interest for them, and it also provided interest-free loans specifically for Hubei merchants. In terms of operation, in addition to providing some chargeable operating tools to merchants for free, it also specially provided additional operation rules to guarantee merchants who could not send out goods due to the epidemic. In terms of marketing and promotion, it encouraged merchants to conduct livestreaming on Taobao without any thresholds and fees, and provided free training to shopping guides that conducted livestreaming. From the beginning of the epidemic, the tight cash flow had brought great pressure to the merchants: in terms of the inflow of cash flow, one part of the reason was the sharp decline in operating income brought by changes or delays in consumers' demands caused by the all-weather stay-at-home, and another part of the reason was the delay of operating income caused by the prolonged transaction process due to factors such as logistics and express, and the other part of the reason was the difficult borrowing and financing caused by the offline closure of financial institutions including banks during the epidemic; in terms of the outflow of cash flow, one part was the limited reduction space of rigid expenditures such as employee salaries, social security, taxes, rents, daily operations, warehousing and logistics; and the other part might be the increased warehousing expenses caused by overstocked products. Platforms of the Taobao series started from these two aspects, solving the dilemma of the inflow of cash flow through low-interest, interest-free loans and early money collection, and reducing merchants' expenses with free policies of various operation and promotion methods.
During the epidemic, JD.com also supported the anti-epidemic frontline, and supported platform merchants, among which the most prominent one was that JD.com provided urgently needed services for the epicenters, platform merchants and common users with its most distinctive and advantageous logistics: JD Logistics not only opened special channels for relief supplies across the country to support Wuhan, but also invested in JD unmanned vehicles and drones to help to fight against the epidemic. It also provided one-to-one service and 48-hour rapid contract service for new warehousing and distribution merchants; The "Daojia Fresh Vegetable Market" project launched by Dada Group under JD.com guaranteed the online supply of fresh products for residents throughout the country during the epidemic prevention and control period. Besides, JD.com also provided comprehensive support to merchants in the aspects of health protection, financial policies, renewal deadlines, flow resources, and so on. The impact of the Lunar New Year holiday together with the epidemic had made most logistics and express companies cannot conduct normal business since the end of January. However, things were different for JD.com. In order to ensure the distribution service capacity during the Lunar New Year, JD.com has implemented a set of holiday operation measures years ago, which retains the necessary personnel for transportation, warehousing, distribution and other positions during the Lunar New Year holiday. And it was just this part of the on-the-job personnel that played a key role in the normal operation of JD Logistics, and also provided an important guarantee for the resumption of work and production of many merchants on the platform. At the same time, with the constant expansion of the express business of JD Logistics, this all-weather, all-time guarantee capability will also benefit more common users, which will also inspire peer companies to improve their own service capabilities to a certain extent.
By virtue of its flexibility of online and offline multiple business types and professional capabilities in many aspects, Suning.com also had outstanding performance in the epidemic: Carrefour, which joined the Suning series last year, launched a store-to-home service, providing "1-hour Carrefour" service project to places three kilometers away around it, and went online on the Suning series platforms such as Suning.com APP, Suning Neighbor Shop APP, and Carrefour applet, and take-out platforms such as Meituan, and Ele.me; Under the circumstance of advanced goods preparation, Suning Neighbor Shops distributed in various communities throughout the country maintained normal operation, so as to ensure the supply of fresh foods and commodities to the surrounding residents. Meanwhile, the community operation was strengthened, enabling the obvious increase of its online orders. In the context of the obvious impact of store operations, redbaby built the combined marketing mode of "classroom livestreaming + activity livestreaming + sales livestreaming", and used applets, livestreaming and community and other online channels to open out-of-store sales; Suning Plaza and other offline business types united brand merchants to keep updating every day on online traffic entrances such as APP, applet, livestreaming, community, and Twker to meet consumers' demands; The main platform of Suning.com launched the "Super Store Livestreaming Plan" jointly participated in by online celebrity hosts and star shop assistants through tools such as applet, APP, and livestreaming platform to conduct real-time online sales. The outstanding offline capability is the hallmark that Suning is different from other main e-commerce platforms, and it is also the basis for ensuring Suning's online and offline full-scenario collaboration and overcoming of difficulties during the epidemic. Promoted by the rigid demands, users had high-frequency contact with the offline business types of Suning through multiple channels, and the effect of offline business types as the traffic entrances of online business has preliminarily appeared. Although this effect is bound to weaken gradually after the epidemic, if the conversion efficiency of offline traffic is strengthened, it is expected that the online business will also have a further rapid growth potential.