Chinese e-commerce giant JD.com pursues budget-minded consumers in slow economy
- JD.com is said to be taking full control over the operation, logistics and after-sales services of its Jingxi low-price shopping platform
Borrowing a page from PDD’s playbook, JD.com is taking full control over Jingxi’s operation, logistics and after-sales services in what is known as a “whole custodian” model, hoping to better serve price-sensitive consumers, according to a report from Chinese media outlet 36kr.
After the restructuring, the head of Jingxi would report directly to JD.com CEO Xu Ran, the report said.
JD.com did not immediately reply to a request for comment on Tuesday.
Major Chinese e-commerce platforms are engaged in an intense price war amid an economic slowdown and sluggish domestic consumer spending.
JD.com, which is popular among affluent shoppers in top-tier cities, launched the Jingxi business unit in 2020 to tap lower-end markets by focusing on extremely budget-conscious consumers, but response has been lukewarm.
Jingxi, which has signed up suppliers of tissue paper, underwear and fruit, plans to expand its partnerships to cover more than 10,000 factories by the end of this year, according to 36Kr.
As of March, more than half of China’s online shoppers, or 647 million people, came from sink markets, according to a report from QuestMobile, a Chinese business research firm.