Google’s new Chinese partner, JD.com, is an online retail titan
Founded by Richard Liu in 1998, JD.com is China’s second largest ecommerce company. It buys goods in bulk from vendors and ships them directly to customers. It had over 290 million active customer accounts in 2017.
From June 1 to 18, 2018, Chinese internet users spent a record US$24.7 billion at an annual online shopping event that is starting to rival Alibaba’s Singles’ Day retail extravaganza in November. The “618 Mid-Year Shopping Festival” is a campaign established by JD.com, the country’s second biggest e-commerce services provider, to mark its anniversary month.
News of that record transaction, however, was eclipsed by internet search powerhouse Google’s announcement that it has invested US$550 million in JD.com. Based in Bejing, JD.com was ranked as China's fourth best-performing internet company last year by industry watchdogs, behind Tencent, Alibaba and Baidu.
Early years
The founder of JD.com is Richard Liu, who was born in a poor farming family in the eastern coastal province of Jiangsu. In the late 1990s, Liu started his own business selling magneto-optical products in Beijing. His company was focused on traditional retail, with counter stores that sold to individual customers and mainly to other local merchants. When the viral respiratory disease SARS hit China in 2003, Liu’s bricks-and-mortar business was hit hard and left him on the edge of bankruptcy.
A year later, Liu closed down all his stores and moved his firm’s operations online, despite initial resistance by his staff to the change of strategy. It was a decision made five years after Jack Ma successfully established Alibaba to lead the then-nascent e-commerce industry in China. Liu’s move paid off, as JD.com’s first five years of online operations posted an average annual growth rate of more than 300 per cent.
Led by founder Richard Liu, JD.com went public in the US in 2014. (Picture: Reuters)
Different path
Amid comparisons with larger rival Alibaba, JD.com has forged its own path to success by sharpening its focus on directly selling consumer electronics goods. The company also set up its own nationwide logistics infrastructure to support sales.
