Goodbaby founder eyes exporting online model to developed foreign markets
If you own a baby stroller, you probably bought it from Song Zhenghuan. He wants to take his homegrown business approach and make it global
China’s flourishing e-commerce sector has opened the floodgates for foreign consumer goods thanks to wealthy mainlanders’ seeking out safe baby products, healthy food and high-quality electrical appliances.
But Song Zhenghuan, founder and chairman of Goodbaby International, believes the country could play it the other way around – export the online-to-offline (O2O) model to developed foreign markets.
“In fact, China is already in the frontrunner position in certain areas,” said Song, who is also chief executive of Hong Kong-listed Goodbaby, the largest supplier of strollers in China, North America and Europe. “In particular, the use of mobile technologies in China is ahead of any other market around the world.”
Song, 67, is dubbed the richest person in Suzhou, in east China’s Jiangsu province.
Since he founded Goodbaby in 1989, the company has evolved into a global baby-related products giant, distributing more than 20 international brands via its 4,500 outlets and e-commerce platform.
“When our O2O model for China is entirely established and ready, we will copy it to foreign markets,” Song said. “My mission is to enhance the quality of life for all babies.”
Cross-border online shopping by mainlanders has been projected to hit 1 trillion yuan (HK$1.26 trillion) by 2018. It is now the bright spot in China’s e-commerce sector as internet firms rush to set up cross-border online shops as domestic demand for foreign goods and food products grows. But Song stressed the importance of hard work done offline.
“A better life can’t be achieved on the internet,” Song said. “In the future, we’ll also list shares on the mainland to raise funds to build various kinds of new-style physical stores to give consumers a better experience.”
O2O e-commerce is an integration of offline business opportunities with the internet. Such platforms attract customers online, but the delivery of the goods, real consumption of services, and experiences of using the products are conducted offline.
“Internet plus” has become a buzz term in China’s retail and finance sectors after Premier Li Keqiang introduced the concept in the government report during the National People’s Congress in March.
It reflects the premier’s strong support for using a wide range of technologies including mobile internet, cloud computing and big data to hugely impact the retail and finance sectors.
“Goodbaby will form a big alliance of global brands for baby-related products before we use mobile internet to connect with our clients anywhere at any time,” Song said.
Goodbaby reported sales of 6.1 billion yuan in 2014, up 46 per cent from a year earlier.
“As the founders of companies like Goodbaby, the entrepreneurs have their own vision and goal,” said Ringo Choi, a managing partner with auditing firm EY. “They want to show how successful they can run their businesses and that’s the biggest motivation among many of those billionaires.”