After entering the food delivery market, JD.com is more competitive during the 618 shopping festival

Author | Wang Xiaojun

Editor | Huang Yu

The "618" shopping festival, which has already become routine, seems to have a new story this year due to several internet companies increasing their investment in the takeaway market.

Prior to this, JD.com released a strong quarterly financial report. The financial report shows that JD.com's revenue in the first quarter was 301.1 billion yuan, a year-on-year increase of 15.8%, the highest growth rate in three years. The net profit attributable to ordinary shareholders was 10.9 billion yuan, a year-on-year increase of 52.7%.

Currently, the significant investment in takeaway services is clearly reflected in the financial report.

After entering the takeaway market, the operating expenses of new businesses, including takeaway services, increased from 1.51 billion yuan in the same period last year to 2.49 billion yuan, a year-on-year increase of 65.3%. This caused the losses of new businesses in the first quarter to expand to 1.327 billion yuan, with an operating profit margin of -23.1%.

However, the growth of other businesses not only offset this investment but also achieved overall growth. Specifically, the revenue from daily necessities increased by 14.9% year-on-year, the 3P business grew by 15.71% year-on-year, and new businesses, including Dada, JD Logistics, Jingxi, and overseas operations, increased by 18.1% year-on-year.

JD.com's entry into the takeaway market is also aimed at driving overall app activity through this high-frequency business. Currently, the effects are already evident. JD.com stated that user growth in the first quarter was strong, with a growth rate exceeding 20%, achieving double-digit year-on-year growth for six consecutive quarters.

In the earnings call, JD.com CEO Xu Ran stated, "We have seen the takeaway business's role in driving overall platform traffic and new user acquisition, while also improving the conversion rate of overall platform traffic."

In recent years, JD.com founder and chairman Liu Qiangdong has returned to the front line, especially in the takeaway business, where he has personally delivered food, dined, and chatted with delivery workers to attract attention to the business.

Of course, JD.com's takeaway service has also performed strongly. On May 15, JD.com's daily order volume officially surpassed 20 million, and it took JD.com just over 20 days to grow from 10 million daily orders to 20 million. In comparison, Ele.me's average daily order volume was around 20 million last year.

According to JD.com, the first restaurant infrastructure "Qixian Food MALL" will officially debut in Harbin on June 18, partnering with ten popular restaurant brands to open their first store in Harbin.

The biggest feature of this store is that it will become the first food MALL in the country to achieve 100% live streaming from the kitchen, and it will also integrate local time-honored brands, intangible cultural heritage cuisine, and popular snacks. Through this physical store, JD.com aims to practice its advocated "quality dine-in + quality takeaway" online and offline interaction.

At the same time, JD.com has designated the 18th of each month as "JD Super Takeaway Day," during which coffee and milk tea will be available for 1.68 yuan per cup, available for everyone to grab.

As for the core e-commerce retail aspect, JD.com's online 618 will officially kick off at the end of May, where consumers can enjoy benefits such as over 1,000 yuan in subsidies per person per day and six interest-free installments on Bai Tiao.

Offline, tens of thousands of JD.com self-operated or managed stores, as well as millions of offline partner stores connected to JD.com’s supply chain nationwide, will participate. Additionally, JD.com’s national strategic layout for MALLs is also accelerating, with the Chengdu Tianfu store and Nanjing Daming Road store debuting in May this year In the upcoming JD.com 618 shopping festival, the Beijing South Third Ring store, Beijing Shuangjing store, Shenzhen first store, and Wuhan Optics Valley second store will all open simultaneously.

As one of the largest shopping festival events held twice a year, JD.com's 618 event requires full support from various sub-businesses. In terms of logistics, JD.com has launched the JD Logistics 618 "Running Assistance Plan."

Specifically, for this year's JD 618, JD Logistics has upgraded its existing basic logistics warehousing and distribution services to three major time-sensitive tiered services: 211 warehousing and distribution, express warehousing and distribution, and preferential warehousing and distribution, while also adding industry-specific customization capabilities. This will help merchants reduce costs and increase efficiency, as well as upgrade their experience in a complex market environment.

It is worth mentioning that this initiative enables JD Logistics to flexibly dispatch over 3,600 various warehouses and more than 32 million square meters of warehousing resources nationwide, covering over 2,800 districts and counties indiscriminately. After the product upgrade, the number of cities covered by the 211 warehousing and distribution service for third-party merchants has increased by 60%, and the number of cities covered by next-day delivery has increased by 35%. The order coverage rate for 211 service + next-day delivery can reach over 90%, providing intelligent full custody services that cover the entire industry with local warehousing, nationwide distribution, and nearby fulfillment.

Since the beginning of this year, JD Logistics has opened various types of warehousing networks in places like Wuxi, Jiangsu, Zhongshan, Guangdong, and Kashgar, Xinjiang, further enhancing its supply chain service capabilities. The upgraded warehousing and distribution network will help merchants further reduce costs and increase efficiency. Additionally, JD Logistics' over 100 overseas warehouses, bonded warehouses, and direct mail warehouses worldwide are also fully operational, ensuring the efficient circulation of JD 618 products globally.

Currently, as JD.com and Alibaba are both ramping up their investments in the instant retail sector focused on food delivery, this year's 618 has taken on a new narrative. Each company is gradually revealing their strategies, and it remains to be seen how the market will respond