During “618,” China’s largest shopping event in the first half of the year, Jingdong, a Chinese e-commerce company, opened an offline shopping mall called “Jingdong Mall” in several Chinese cities simultaneously. Jingdong, which has grown into an online shopping platform, has made a breakthrough amid intensifying competition and sluggish consumption through aggressive offline channel expansion.
Jingdong Mall Shuangjing store, which is 50,000 square meters wide, is located not far from the commercial district (CBD) in Beijing’s Chaoyang district. The store is set to open on Friday, and is now an offline shopping mall run by Jingdong, China’s No. 2 e-commerce company. Along with the Gwanggun Festival in November, Jingdong will open a shopping mall not only in Shenzhen, Guangdong Province, and Taiyuan, Shaanxi Province. The 618 is an annual discount event that has been held since 2010 to commemorate Jingdong’s foundation day, June 18. As the event has been well received by consumers, the event has become a large-scale shopping festival in which not only Jingdong but also all Chinese e-commerce companies participate.
Jingdong’s strategy is to attract consumers who want to experience and buy expensive products by expanding offline channels. In the Chinese market, competition is fierce with Alibaba-affiliated Taobao or Tianmao and Pinduoduo (the parent company of Temu), which launched ultra-low priced products. Jingdong plans to not only increase its experience in online consumer products such as direct purchase of genuine products and same-day delivery, but also to preoccupy consumers with high-priced products by increasing consumer contact offline. Jingdong Mall Shuangjing has placed a number of experience zones for each product category and brand. It brought together dozens of related brands targeting consumers who purchased personal computers for games, and placed around 10 PCs assembled with the products in the exhibition hall. Humanoid robots, robot dolls, and animals have also appeared in various stores. Instax, an instant camera, and Nintendo, a game console, have set up separate brand experience zones. “We rarely order refrigerators or furniture that cost more than 20,000 yuan on any online platform,” said Chen Luyi, vice president of Shuangjing branch. “Through offline channels, consumers can directly check and experience looks and functions, which complements areas that are difficult to meet online.”
Jingdong, which started offline and turned into an online-only shopping mall. founder Liu Chang-dong opened a small electronic appliance store in Zhongguancun, Beijing in 1998. After SARS broke out in 2003, the company switched to an e-commerce company in earnest the following year. Then, the company opened its first Jingdong Mall in Xian, Shaanxi Province, in 2021, increasing the number of offline consumer contacts. The Maeil Business Newspaper, a Chinese economic media outlet, said there are 24 Jingdong Mall across China, and Jingdong plans to increase the number by 8 to 10 every year.
With the Chinese government making all-out efforts to boost domestic consumption, attention is focusing on whether the volume of the June 18 shopping event will turn around. The amount of consumption that is tallied at the event is also a gauge of the trend of private consumption in China. The value of total commodities (GMV) traded during the June 18 period last year fell for the first time in eight years. This year’s June 18 shopping festival started from March 13 and will last for 37 days, the longest ever. Although the Chinese government is seeking to overcome sluggish consumption due to the economic downturn by implementing subsidies for “exchange to new,” China’s consumer price index declined for four consecutive months in May.
SALLY LEE
US ASIA JOURNAL
